The Philippines and Japan on Friday signed another batch of loan agreements worth 220 billion Japanese yen, or approximately P84.81 billion, for the completion of the Metro Manila Subway Project (MMSP), which was derailed after funding from recent budgets was allegedly gutted to make room for congressional “insertions” of lawmakers. 

Aside from the fourth tranche loan for the MMSP Phase 1, Tokyo will also support the Central Mindanao High Standard Highway Construction Project through a loan from the Japan International Cooperation Agency (JICA) amounting to 1.672 billion yen, or around P644 million. 

Foreign Affairs Secretary Ma. Theresa Lazaro and Japanese Ambassador to the Philippines Endo Kazuya led the signing of the deal for two projects in Pasay. 

Kazuya reaffirmed Japan’s relentless support to boost infrastructure projects in the Philippines. He also expressed hope that the implementation of the said projects will be “steady and smooth.”

The MMSP is a flagship program of President Marcos Jr., which was supposed to be completed in 2028, before he left office. 

However, the project incurred a four-year delay after lawmakers reportedly defunded it from the 2023, 2024, and 2025 General Appropriations Act (GAA) to make space for their “insertions,” which had allegedly ballooned to a staggering P1.45 trillion under the Marcos administration. 

Opposition House lawmaker Edgar Erice earlier said that congressional insertions in the recent budget displaced funds for more than 15 big-ticket projects, including MMSP and the expansion of the Philippine National Railways, also known as the North-South Commuter Railway (NSCR). 

These flagship projects under Marcos’ “Build Better More” Program have a combined price tag of P1.4 trillion. 

Japan will shoulder the bulk of the project’s cost through the said loan, while the Philippines will provide equity.

As a result of the delay, the government faces an estimated P300 billion in financial repercussions, including commitment fees, penalties, and costs for materials and labor.

Back in January, Marcos ordered the release of P44.17 billion to fast-track the construction of the MMSP and the NSCR. 

The MMSP primarily aims to meet the growing demand for public transport and alleviate traffic congestion in Metro Manila. It will cover the construction of a 27.5-kilometer subway line from Valenzuela to NAIA Terminal 3. 

Meanwhile, the Central Mindanao Highway aims to reduce travel time between Cagayan de Oro and

Malaybalay from 6.5 to 3.5 hours, enhancing connectivity and trade competitiveness in the region. 

The project is expected to be completed within eight years, starting from 2026 to 2034.