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PHILIPPINES: PH, China ‘Negotiating’ to Move Projects Forward

China on Sunday said it is “negotiating” with the Philippines over the funding of some infrastructure projects after a Philippine transport official bared that these were deemed “withdrawn” due to Beijing’s inaction on funding requests by the previous administration.

The Chinese Embassy issued the clarification after Transport Undersecretary for Railways Cesar Chavez revealed that the Philippines scrapped its loan applications for three big-ticket railways— the Philippine National Railways Bicol project, Subic-Clark Railway Project, and the first phase of the Mindanao Railway Project— due to Beijing’s unresponsiveness to its loan application since 2019.

Chavez earlier said President Ferdinand “Bongbong” Marcos Jr. is looking at renegotiating the loans with Beijing or negotiating with other countries.

In a statement, the Chinese Embassy did not directly mention the funding withdrawal, but vowed to “tap its own advantage and support the Philippines to improve its infrastructure.”

“Our two sides have been negotiating technical issues and made positive progress to move the projects forward,” the embassy said.

The embassy said “China is open for technical discussions over our G-to-G [government-to-government] projects, and is ready to carry our cooperation forward, in close communication with the Philippine new administration.”

According to the embassy, China has helped the Philippines complete 17 projects while more than 20 projects are under implementation or in progress.

“Over the past two years, Covid-19 has impacted implementation of some projects, hindering the site availability, causing delays of procurement, affecting goods mobility, and so on. Despite those difficulties and challenges, our two sides have worked tirelessly to push the projects forward and yielded rich outcomes, spanning from anti-pandemic response, disaster relief to infrastructure, agriculture, and other fields,” the embassy said.

New era of friendship

The Chinese Embassy described the phone conversation between Chinese President Xi Jinping and Marcos on May 18 and recent high-level visits as having ushered in “a new era of China-Philippine friendship.”

“Governments of the two countries are dedicated to further enhancing friendship and mutual trust, adhering to good-neighborliness and deepening mutually beneficial cooperation. China’s policy towards the Philippines has always been and will continue to be consistent and stable as ever,” the embassy said.

The Chinese Embassy expressed confidence that “continuity” would be secured in relations between two countries as well as the bilateral practical cooperation.

“Looking forward, China will build on the past fruition and further our cooperation in agriculture, infrastructure, energy, people-to-people exchange, and other fields,” it added.

Chavez said China’s funding commitment for the railway projects was “deemed canceled” as China has been unresponsive to the Philippine government’s loan application since 2019.

He said the Chinese bank was asking for 3-percent interest on the loans, much higher than the 0.01-percent rate charged by Japan.

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