Philippines confirms US funding boost for flagship railway project amid foreign aid freeze

Move indicates Washington’s intent to deepen economic cooperation and is ‘good signalling’ for bilateral ties, analysts say

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A truck arrives at a container terminal in Navotas, Metro Manila, the Philippines. The Subic-Clark-Manila-Batangas Railway is expected to connect major ports and airports in the country. Photo: Reuters

Published: 2:56pm, 12 May 2025Updated: 3:22pm, 12 May 2025

The United States has approved funding for a major railway under the Luzon Economic Corridor – a flagship infrastructure initiative designed to connect key Philippine ports and industrial zones – in a move analysts say signals Washington’s intent to deepen economic cooperation with Manila despite a broader foreign aid freeze.

“The Luzon Economic Corridor is on track. Many have been asking in the last two months what happened here. We received a letter from the US Trade and Development Agency that the loan for the Subic-Clark-Manila-Batangas Rail has been approved,” Frederick Go, special assistant to the president for investment and economic affairs, said at a press briefing on May 5.

Go said the US trade agency had reportedly increased funding for the Subic-Clark-Manila-Batangas Railway from US$2.5 million to US$3.8 million, which was relayed to the Philippine government on April 28 following the selection of a US consultancy firm.

“This milestone demonstrates that the Philippines-US economic ties are stronger than ever,” Go said, adding that a formal agreement would be signed in the coming days. “This is great positive news.”

Washington has not yet issued a formal statement on the matter.

The 250km (155-mile) freight rail line will connect four key cities across Luzon, the Philippines’ largest island, linking three major ports and two international airports. The government expects the project to create jobs, lower transport costs and improve logistics, while also boosting trade flows across the archipelago.

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Philippines confirms US funding boost for flagship railway project amid foreign aid freeze

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Move indicates Washington’s intent to deepen economic cooperation and is ‘good signalling’ for bilateral ties, analysts say

Move indicates Washington’s intent to deepen economic cooperation and is ‘good signalling’ for bilateral ties, analysts say