Philippines seeks more loans from Japan this year

The Philippine government is looking to sign 11 additional loan agreements valued at JPY 371 billion (around PHP 139 billion) in a bid to fast-track infrastructure projects after a corruption scandal slowed public spending, the Department of Finance (DoF) said.

“We are targeting, this 2026, the signing of 11 additional loan agreements with a total estimated value of JPY 371 billion or roughly USD 2.4 billion,” Finance Secretary Frederick D. Go said during the 42nd PHILJEC–JPECC Joint Meeting late Thursday.

“This reflects the continued alignment between our infrastructure priorities and Japan’s support,” he said.

The government is also looking to the sign three loan agreements with the Japan International Cooperation Agency (JICA), proceeds of which will fund key projects like the Metro Manila Subway and the Central Mindanao Highway, Mr. Go said.

“Japan’s fiscal year 2025 concludes this March. The Philippines looks forward to the signing of three critical loan agreements with a total value of approximately USD 1.58 billion (around PHP 91.2 billion) to be extended by JICA,” he noted.

Earlier this month, the two countries signed the exchange of notes for a JPY 21.6-billion (PHP 8.1-billion) loan deal for the ongoing rehabilitation of the Metro Rail Transit (MRT)-Line 3.

Since the start of the Marcos administration, the Philippines and Japan have signed 12 financing deals worth JPY 910.38 billion (about PHP 341.2 billion).

Many of these projects are in its financing or construction stages, the DoF said.

“Each project reflects Japan’s reputation for quality infrastructure—durable, efficient, and future-ready. And each project reflects the Philippines’ determination to build better, faster, and smarter,” Mr Go said.

As of December last year, Japan accounted for USD 13.9 billion or 33.54% of the Philippines’ total official development assistance (ODA) portfolio.

Japan is the Philippines’ largest ODA loan provider and third-largest source of ODA grants.

The government is also looking to update the Japan-Philippines Economic Partnership Agreement (JPEPA), Mr. Go said.

The JPEPA, which took effect in December 2008, is the Philippines’ first bilateral free trade agreement (FTA).

The deal covers trade goods, rules of origin, customs procedures, investment, movement of natural persons, intellectual property, and government procurement.

Trade Secretary Ma. Cristina A. Roque earlier said she is looking to meet with her Japanese counterpart within the first quarter to discuss the JPEPA.

Japan was the Philippines’ third-largest export market and fourth-largest source of imports in 2025.

Mr. Go also noted that the country’s long-term economic fundamentals remain strong despite the weak economic growth recorded last year.

Gross domestic product (GDP) growth slowed to five-year low of 4.4% in 2025 after a corruption scandal weighed on public spending.

Despite this, the Finance chief noted that Philippine GDP growth is well-above the global growth average of 2.9%.

“If you look at our long-term growth trends, we will go back up to the 5% plus this year,” he said.

To attract more investors, Mr. Go said the government is looking at implementing reforms to improve the ease of doing business, boost public-private partnerships, and create a predictable and competitive investment environment. — Beatriz Marie D. Cruz, Reporter