Overview

The Philippines lags many neighboring countries in infrastructure development and is notorious for challenging traffic conditions and long commutes, undercapacity in international airports, and port congestion.

As of July 2023, the Marcos administration has 197 projects in its Infrastructure Flagship Projects list, with 71 projects that are under various stages of construction, 30 projects approved for implementation, 8 for government approval, 52 under project preparation, and 36 under pre-project preparation.  Out of the 71 ongoing flagship infrastructure projects, 40 are transport-related, and out of the 30 projects approved for implementation, only six are not transportation projects.  

Prior to the Marcos administration, the Philippine government favored projects linked to tied-aid loans because they are offered at concessional rates with long repayment periods.  Japan emerged as a leader in this area, quickly claiming the big-ticket rail projects.  The Asian Development Bank (ADB), World Bank, and Korea were the Philippines’ other sources of concessional loans for the flagship projects.  Out of the 197 projects in the Marcos administration’s list of Flagship Infrastructure Projects, 40 percent are/will be funded through foreign aid; 31 percent by the Philippine government’s budget; and 20 percent via public-private partnership (PPP).  Other projects are/will be funded by a combination of foreign aid, government budget and/or PPP.

U.S. firms are encouraged to identify projects of interest, research their status, and determine how to engage and assess risks. 

Leading Subsectors

Rail

Projects that initially garnered high U.S. interest include the $3 billion North-South Commuter Railway Project (Philippine National Railway [PNR] North 1), the $12 billion North-South Commuter Railway Extension (PNR North 2 South Commuter) Project, and the $7 billion Metro Manila Subway Project Phase 1.  Japan International Cooperation Agency (JICA) is funding the subway project, while ADB and JICA are funding the rail projects.  U.S. firms cannot be the main contractor on record for JICA-funded projects, but the project size allows for subcontracting and supply opportunities.

Airport

The major airport projects in the Philippines are the following:

· Rehabilitation, operation, and expansion of the airside and landside facilities of the Ninoy Aquino International Airport (NAIA), a brownfield facility with 48 million passengers in 2019.  NAIA is the international gateway for most visitors entering the Philippines.  As of October 2023, the Philippine government is inviting airport operators and investors to participate in this project that will be undertaken under a public-private partnership arrangement.

· $14 billion New Manila International Airport in Bulacan, a greenfield PPP project with a design capacity of up to 200 million passengers annually and plans for four parallel runways.   

Market Opportunities

A range of products and services are needed to complete the transportation infrastructure projects, including building products, construction equipment, electrical and mechanical equipment, IT-related systems, and consulting services. 

U.S. firms can participate in transportation infrastructure projects by:

• Serving as consultants/subconsultants, contractors/subcontractors, or goods suppliers for Official Development Assistance (ODA)-funded and/or PPP projects,
• Bidding on Philippine Government project tenders,
• Partnering with a local firm for ODA-, PPP- and/or Philippine government- funded projects.

Resources 

· National Economic and Development Authority

· Department of Public Works and Highways

· Department of Transportation

· Public-Private Partnership Center

Contact Information

Bebe Montesines, Commercial Specialist, U.S. Commercial Service Philippines

Email: Bebe.Montesines@trade.gov

For Asian Development Bank (ADB) funded projects:

Hanes Roberts, Senior Commercial Officer, U.S. Commercial Service Liaison to ADB

Email: Hanes.Roberts@trade.gov