6-11-2023 (MANILA) Japan, South Korea, and India have extended offers to fund three significant railway projects in the Philippines, amounting to nearly US$5 billion, according to the country’s Transportation Secretary, Jaime Bautista. This comes after Manila discontinued its reliance on China as a funding source last year.
Transportation Secretary Bautista revealed that the Philippine government is exploring the possibility of utilizing official development assistance (ODA) from these three countries. He also noted that the government may consider contributing to the funding of these rail projects or attracting private sector investments.
Bautista, speaking at a media forum, stated, “We’re exploring these. We cannot give any details yet.”
The three railway projects in question are the Subic-Clark Railway Project, the Philippine National Railways South Long-Haul Project, and the Davao-Digos segment of the Mindanao Railway Project, collectively valued at US$4.95 billion.
President Ferdinand Marcos Jr. had directed officials to renegotiate loan agreements with China last year, which had been deemed “withdrawn” after the Chinese government failed to respond to the funding request. However, as no progress was made in the loan negotiations with China for the rail projects initiated in 2018 during the tenure of former President Rodrigo Duterte, the government began seeking alternative financing options.
During his presidency, Duterte pursued closer ties with Beijing and set aside territorial disputes in exchange for substantial aid. Marcos assumed office in June of the previous year, succeeding him.
According to government data, the Philippines had over 1,100km of operational railway before World War II, but by 2016, it had only 77km, lagging far behind other urban centers across Asia. Marcos has made promises to modernize the country’s railway system.
Furthermore, construction is currently underway on the Philippines’ first subway train, funded by loans from Japan, in the capital region.
