Japan agrees $US 1bn loan for Metro Manila Subway
- Pinnacle Team
- Sep 4
- 2 min read
A new chapter is beginning between Japan and the Philippines. The relationship between the two countries is solidifying with the announcement of significant financial support for the Metro Manila Subway Project from the Japan International Cooperation Agency (JICA). Under this agreement, JICA will lend 55.7 billion pesos (approximately $1 billion USD) for the construction of this 33-kilometer subway line. This is the third loan JICA has provided for the project, bringing the total investment to $3.3 billion.
This loan signifies a major step forward in the development of the Philippines' transportation infrastructure. The subway line, which will run from Valenzuela City to Pasay City, will include 17 stations and is planned to connect to Ninoy Aquino International Airport (NAIA) in Parañaque City. The estimated budget for the project's completion is approximately 355.6 billion pesos, with a target completion date of 2029. This is expected to drastically reduce travel time between Valenzuela City and Pasay City from the current 1 hour and 30 minutes to just 35 minutes.
What's even more noteworthy is the positive economic and environmental impact the project will bring. Finance Secretary Ralph Recto stated that the new subway line will save approximately 2.5 billion pesos daily through reduced transportation costs and carbon emissions. This provides a crucial opportunity for the Philippines to achieve both sustainable development and environmental protection simultaneously.
The terms of JICA's loan are also remarkable. The interest rates for the first two loans were set at a very low 0.1% per annum for non-consulting services and 0.01% per annum for consulting services, with a maturity of 40 years for each loan. These are very favorable terms for the Philippine government and will contribute significantly to the country's long-term development plans.
This agreement is a testament to the continuous cooperation and mutual understanding between Japan and the Philippines. The two nations are moving toward a brighter future through improved transportation infrastructure, which will positively impact the development of the entire region. The Metro Manila Subway Project will be more than a simple improvement to the transportation system; it will be an important milestone symbolizing the change and development of Philippine society.
March 2, 2024
