Signing of Japanese ODA Loan Agreements with the Philippines: Contributing to economic revitalization through easing traffic and improving connectivity in Metro Manila and Mindanao through construction of the Metro Manila Subway and Central Mindanao High Standard Highway

On March 27, the Japan International Cooperation Agency (JICA) signed loan agreements with the Government of the Republic of the Philippines in the capital city Manila, to provide Japanese ODA loan for the following two projects: “Metro Manila Subway Project (Phase 1) (IV)” and “Central Mindanao High Standard Highway Construction Project (Cagayan de Oro-Malaybalay Section) (Engineering Services)”. The signatures were exchanged between Secretary Frederick D. Go of Department of Finance of the Republic of the Philippines and Chief Representative Baba Takashi of JICA Philippines.

Terms and Amount of Loan

- Country (Target Areas)
Republic of the Philippines (Metro Manila)

- Project Objective
The objective of the Project is to accommodate increasing transportation demand by constructing a subway line in Metro Manila, thereby contributing to the alleviation of serious traffic congestion as well as to the mitigation of air pollution and climate change.

- Project Component
1. Civil works, facilities, equipment, etc.
(a) Civil works
(b) Depot and Philippines Railway Institute (PRI)
(c) Railway system
(d) Procurement of Rolling Stock (240 train cars)
2. Consulting services (e.g., bidding assistance, supervision of construction, capacity building of the executing agency, and support for implementing Transit Oriented Development)

- Maximum Loan Amount
220,000 million Japanese Yen

- Annual Interest Rate
Project: 0.8%, Consulting Services: 0.8%

- Repayment Period
40 Years

- Grace Period
10 Years

- Procurement
Japan Tied

- Executing Agency
Department of Transportation

- Contribution to SDGs
Goal 9 (Industry, Innovation and infrastructure)
Goal 11 (Sustainable cities and communities)
Goal 13 (Climate action)

- Planned Implementation Schedule
1. Completion of the Project: October 2031, upon the commencement of the service of the facilities
2. Issuing of letters of invitation for consulting services (including detailed design work): November 2018 (Contracted)
3. Tendering of announcement of initial procurement package for international competitive bidding on project construction: Package for CP101 (Civil Works)
Release date: February 2018 (Contracted)

Special Terms for Economic Partnership (STEP)* will apply to the Japanese ODA loan for this project, and Japanese technology, including steel-concrete composite structures, half‑precast elements for tall piers, and deep foundation pile techniques,　will be utilized at the construction of tall bridge piers being constructed in the project.

Terms and Amount of Loan

- Country (Target Areas)
Republic of the Philippines
(Misamis Oriental Province and Bukidnon Province, Mindanao)

- Project Objective
The objective of the Project is to improve transportation access between north-central and southern Mindanao by constructing alternative road connecting Cagayan de Oro City to Malaybalay City as part of the Central Mindanao High Standard Highway from Cagayan de Oro to Davao, thereby contributing to economic and social development of Mindanao.

The portion eligible for this ODA loan covers engineering services related to the detailed design, bidding assistance, and other preparatory work for the section located within Cagayan de Oro City. These services are intended to facilitate the smooth and efficient implementation of the Project.

- Project Component
1. Civil Works:
Construction of approximately 65 km of high-standard, four‑lane (two lanes per direction) roadway, including long-span bridges. Of this, about 12 km within Cagayan de Oro City (Section 1) is planned to be financed by JICA, while the remaining approximately 53 km (Sections 2–5) is expected to be financed by the Asian Development Bank (ADB) and other development partners.
2. Consulting Services:
(i) Detailed design, (ii) Tender assistance, (iii) Construction supervision, (iv) Support for strengthening operation and maintenance capacity, (v) Environmental and social considerations

Under this loan, prior to the Civil Works, the consulting services will cover the detailed design (including preparation of draft bidding documents) for Section 1.
The detailed design for Sections 2–5 will be implemented under ADB financing through the Infrastructure Preparation and Innovation Facility, Second Additional Financing (Loan Agreement signed December 2023).

- Maximum Loan Amount
1,672 million Japanese Yen

- Annual Interest Rate
Consulting Services: 0.80%

- Repayment Period
40 Years

- Grace Period
10 Years

- Procurement
Japan Tied

- Executing Agency
Department of Public Works and Highways (DPWH)

- Contribution to SDGs
Goal 8 (Decent Work and Economic Growth)
Goal 9 (Industry, Innovation and Infrastructure)

- Planned Implementation Schedule
Completion of the Project: November 2028, at loan closing
Issuing of letters of invitation for consulting services (including detailed design work): March 2026

Special Terms for Economic Partnership (STEP)* will apply to the Japanese ODA loan for this project, and Japanese technology, including PC box girder with corrugated steel-web bridge and half-precast for high piers, and sinso-caisson, will be utilized in the project.

* STEP refers to special assistance terms for promoting the visibility of Japanese aid through a transfer of outstanding Japanese technology and expertise to developing nations. The main contract is Japan tied and subcontracting is general untied. The main agreement partner must generally be a Japanese company, an overseas subsidiary of a Japanese company, or a joint venture between a Japanese company and the borrowing country where the Japanese company is the lead partner, although under certain conditions, a joint venture between a Japanese company (which is the lead partner of the joint venture) and an affiliated company (as accounted under the equity method) of a Japanese company may be the main agreement partner.