Despite the tension over territorial rights in the West Philippine Sea, the government has not given up on negotiating with Chinese partners to secure loan financing for the first phase of the 565-kilometer PNR South Long Haul Project.

"Negotiations are ongoing, and I don't think (the West Philippine Sea issue) will be a factor. It is more on how interested the Chinese government is in the project. It is a matter of how badly or enthusiastically they would want to pursue the project," PNR general manager Jeremy Regino said in an interview.

Regino, however, said the Departments of Transportation or DoTr and Finance or DoF are also preparing a contingency plan in case discussions with China fail anew.

Other options on table

"The DoTr and DoF are evaluating other options for financial assistance as well as a hybrid approach where the government will partially fund the project along with Official Development Assistance from other partners," he said.

In July last year, barely a month into the Marcos administration, the DoTr disclosed that the Chinese government withdrew funding for three multi-billion railway deals under the Duterte administration's massive "Build, Build, Build" flagship program.

The financing covered contracts for the first package of the PNR South Long Haul Project worth P142 billion, the Subic-Clark Railway Project worth P50.03 billion, and the first phase of the Mindanao Railway Project worth P82 billion.