Philippines wants US, Japan to build rail network after dropping Beijing as ties sour over South China Sea frictions

The US$868 million Subic-Clark railway will link the former American military bases turned commercial hubs

An official overseeing the project hoped it would be added to the Luzon Economic Corridor that was unveiled at last week’s trilateral summit in Washington

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A US supply ship is docked at a shipyard in Subic, Philippines. Photo: Bloomberg

Published: 1:03pm, 20 Apr 2024

A Philippine freight railway project may be built with the support of the US and Japan, an official in charge of it said, as Manila seeks alternative financing deals after dropping funding talks with China.

The 50-billion-peso (US$868 million) Subic-Clark railway, which will link the former US military bases turned commercial hubs, is being pitched to form part of the Luzon Economic Corridor, a planned showcase of economic cooperation between the US, Japan and the Philippines that was hatched during the first trilateral summit among its leaders last week at the White House.

“Hopefully they take it and invest here,” Delfin Lorenzana, who chairs the Bases Conversion and Development Authority, said in an interview on Friday, referring to the US and Japan. The agency oversees the development of former military bases.

The Philippines said last year that it would no longer pursue Chinese loans to fund three projects, including the 71-kilometre (44-mile) Subic-Clark railway, amid lack of progress from the Chinese side. Manila’s move came amid souring ties between the Philippines and China over competing maritime claims in the South China Sea.

US President Joe Biden, Japan Prime Minister Fumio Kishida and Philippine President Ferdinand Marcos Jnr launched the Luzon Economic Corridor during their April 11 meeting and a trilateral event to promote investment in the project is being planned at the US-led Indo-Pacific Business Forum in Manila in May.

The Philippines said it hopes to generate around US$100 billion in investments in the next five to 10 years following the Washington summit.

The project aims to boost connectivity between Subic Bay and Clark, Manila, and Batangas province in the country’s main Luzon island and accelerate investments in infrastructure projects, including rail, ports, clean energy, semiconductor supply chains and agribusiness.