MANILA: Japan, South Korea and India have offered to finance three Philippine railway projects worth nearly US$5 billion, the country’s transport chief said on Monday (Nov 6), after Manila dropped China as a funding source last year.
Transportation Secretary Jaime Bautista said the Philippine government could tap the three countries for possible official development assistance (ODA). He said the government may also fund a portion of the rail projects or seek private sector investments.
“We’re exploring these. We cannot give any details yet,” Bautista told a media forum.
The rail projects 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 worth US$4.95 billion.
President Ferdinand Marcos Jr had ordered officials last year to renegotiate loan agreements with China, which were considered “withdrawn” after the Chinese government failed to act on the funding request.
But Bautista said the government had to look for other financing options since there was no progress on the loan negotiations with China on the rail projects, which began in 2018 during the term of former President Rodrigo Duterte.
Duterte pursued warmer ties with Beijing and set aside territorial disputes in exchange for billions of dollars in aid when he was president. Marcos replaced him in June last year.
From more than 1,100km before World War II, the Philippines had only 77km of operational railway as of 2016, well behind other urban centres across Asia, government data shows. Marcos has promised to modernise the country’s railway system.
Construction of the Philippines’ first subway train, funded by loans from Japan, is underway in the capital region.