The Manila government has declared a firm commitment to the bilateral economic partnership with Japan as they agreed to pursue a number of major infrastructure projects across the Philippines, the National Economic and Development Authority (NEDA) said.
In a statement on Tuesday, NEDA Secretary Arsenio Balisacan said the government had identified 17 infrastructure flagship projects with an indicative total cost of P1.386 trillion.
According to the NEDA website, Japan is a development partner for these 17 IFPs, which are high-impact and urgently needed projects.
During the 15th Meeting of the Philippines-Japan High-Level Joint Committee on Infrastructure Development and Economic Cooperation held earlier this week, Balisacan said, “We have taken stock of our accomplishments, exchanged updates on critical initiatives, and explored new avenues for cooperation.”
The NEDA said the meeting focused on opportunities to strengthen multi-sectoral cooperation in areas such as disaster risk reduction, maritime safety, regional development, information and communications technology, and energy and environment.
Projects supporting the Mindanao Peace Process were also discussed during the meeting.
The meeting also reviewed the progress of several infrastructure projects currently in the pipeline that are supported by the Japanese government, the NEDA said.
Based on NEDA’s IFP dashboard, Japan supports the IFPs P5.26 billion Arterial Road Bypass Project Phase III (Plaridel Bypass) and the P12.54 billion Flood Risk Improvement and Management Project for the Cagayan de Oro River, both completed in 2024.
This year’s ongoing target for completion is the P14.94 billion Central Luzon Link Expressway Phase I.
Ongoing projects set for completion in 2027 are the P70.81 billion Davao City Bypass Construction Project, the P77.76 billion Manila Metro Line 1 Cavite Extension or the LRT 1 Cavite Extension Project, and the P29.81 billion MRT-3 Rehabilitation Project.
The P10.34 billion Metro Manila Priority Bridges for Seismic Improvement Project and the P12.86 billion Road Network Development Project in Conflict-Affected Areas in Mindanao are targeted for completion at the end of the administration’s term.
Meanwhile, Japan-supported IFPs eyed for completion beyond 2028 include the P22.04 billion Cavite Industrial Area Flood Risk Management Project, the P76.41 billion Cebu-Mactan Bridge and Coastal Road Construction Project, the P67.4 billion Dalton Pass East Alignment Road Project, the P488.48 billion Metro Manila Subway Project Phase 1, and the P57.7 billion Pasig-Marikina River Channel Improvement Project Phase IV.
The P14.37 billion 2nd San Juanico Bridge Project, the P41.72 billion Davao City Flood Control and Drainage Project, and the P136.15 billion Paranaque Spillway/Tunnel Project are still under project preparation and targeted for completion beyond 2028.
Also included in the list of Japan-supported IFPs is the P247.5 billion Metro Manila Subway Project Phase 2, which is in the pre-project preparation stage. The implementing agency still needs to confirm the target year of completion.
The IFP dashboard does not provide the terms and/or value of support provided or to be provided by Japan; it states only the indicative project costs.
On Monday, the Philippines secured P65.43 billion in official development assistance (ODA) from the Japan International Cooperation Agency to finance big-ticket infrastructure projects and budget support for health and climate change initiatives.
Five financing agreements were signed, which include P17.67 billion or JPY46.34 billion for the Davao City Bypass Construction Project (III), P17.45 billion or JPY45.76 billion for the Pasig-Marikina River Channel Improvement Project, Phase IV (II), P5.52 billion or JPY 14.48 billion for the Cavite Industrial Area Flood Risk Management Project (II), P13.35 billion or JPY35.0 billion for the Climate Change Action Program, Subprogram 2 and P11.44 billion or JPY30.0 billion for the Build Universal Health Care, Subprogram 2.
In the statement, Balisacan emphasized the need to sustain these investments, implement policy reforms, strengthen institutions, and recognize the importance of innovative financing solutions as the Philippines progresses toward achieving upper middle-income country status.
“Our discussions also underscored the importance of innovative financing solutions. With concessional loans becoming less accessible, we recognize that Public-Private Partnerships will play a greater role in infrastructure development,” Balisacan said.
Sought for comment, Michael Ricafort, Rizal Commercial Banking Corp. chief economist, said further easing of foreign ownership restrictions would help increase Japanese foreign investments in the Philippines.
“Japan has also been the country’s biggest lender, especially in terms of ODA, (and it is set) to increase further with the latest commitments by the Japanese government, as well as by Japanese companies,” Ricafort said.
“Interest rates on loans by the Japanese government in recent years at around 0.1 percent to 0.2 percent, or less than one percent per year, the lowest among creditor/lending countries at much longer payment terms and even with grace periods for some loans,” he added.
According to the latest available data from NEDA, Japan accounts for the largest share of ODA in the country, at 32 percent of the active ODA portfolio as of 2023.
