PH eyes partnership with Japan after China-backed rail deals stalled

Davinci Maru, ABS-CBN News

Posted at Aug 15 2022 11:45 AM | Updated as of Aug 15 2022 11:57 AM

The planned Subic-Clark Railway. Photo from the Chinese Embassy in Manila.
The planned Subic-Clark Railway. Photo from the Chinese Embassy in Manila.

MANILA — The Philippines is considering working with Japan in constructing the country's railway projects after several China-backed deals were stalled due to lack of funding, the Department of Transportation said Monday.

According to Transportation Secretary Jaime Bautista, the DOTr had discussed with the Japan International Cooperation Agency about a possible funding support for these projects.

"Actually, we are not limiting our options to China. We can also consider working with Japan and JICA," he told ANC's "Headstart".

"In fact, we had a meeting with JICA a week ago and we also mentioned to them about the possibility of them providing the support for these projects."

Bautista said the Philippine government is exploring "different options" for its infrastructure projects.

"We want to see to it that these options are available and it will really fast-track the construction and implementation of these projects because you know the order of the President for DOTr is full speed ahead," he said.

Last week, Manila has renewed talks on 3 railway deals struck with Beijing. These are the PNR South Long Haul Project (North-South Commuter Railway), Subic-Clark Railway and Mindanao Railway (Tagum-Davao-Digos).

Bautista noted the projects were stalled because China wants to charge an interest rate of 3 percent for the loans, which the previous administration believed is too costly.

Japan's loan interest rate is 0.01 percent.

Following a meeting with Chinese Ambassador Huang Xilian, Bautista said they were assured the Philippines would get a "good deal."

"They said that they will see to it that the contractors will give us very competitive rates so that the overall cost of constructing the projects will be cheaper even the interest rates will be a little bit higher," he said.

Should the projects push through, Bautista promised it would be "substantially complete" under the term of President Ferdinand Marcos Jr.

"Six years may not be enough but if we do it right, we should be able to substantially complete the projects before the term of President Bongbong ends," he said.

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