Philippine agencies rolling out big-ticket infrastructure projects and the Japanese government’s official development assistance (ODA) arm have pledged to fast-track the completion of Japan-funded projects in the country despite lingering challenges, especially on right-of-way (ROW) acquisition.

Department of Transportation (DOTr) Secretary Vivencio B. Dizon said the commitment was sealed during a meeting with the visiting Japan International Cooperation Agency (JICA) Parliamentary League on Wednesday, Aug. 27.

Besides Dizon, high-ranking officials of the Department of Public Works and Highways (DPWH), Department of Economy, Planning, and Development (DEPDev), Department of Budget and Management (DBM), and Philippine Coast Guard (PCG) met with the Japanese delegation.

“We will cooperate continuously with JICA and the other Japanese agencies to make sure that these projects are completed quickly and are completed with the utmost quality that Japan is very well known for,” Dizon said. “For the DOTr, we commit that we will make these projects faster.”

Dizon also underscored President Ferdinand R. Marcos Jr.’s directive to expedite Japan-funded projects, particularly those under the DOTr and the DPWH.

Earlier, JICA Philippines Chief Representative Takashi Baba told Manila Bulletin that “all” Japan-funded projects have been affected by the country’s budget constraints.

In an interview last Aug. 14, Baba said that Japan’s average annual commitment to the Philippines amounts to about 200 billion Japanese yen, or over ₱77 billion, even as actual funding depends on project readiness and national priorities.

To address this, Dizon assured that the President has committed to fully funding the Philippine government’s counterpart obligations.

“The GOP [government of the Philippines] counterparts’ budgets will be fully funded,” the DOTr chief said. “That is the commitment not just from us but from the President himself.”

Under the proposed ₱6.793-trillion 2026 national budget, a total of ₱283.3 billion will be allocated to foreign-assisted projects. Of this amount, over ₱82 billion will come from counterpart government financing to support ₱201.3 billion in loan proceeds.

Next year’s funding for foreign-assisted projects is more than four times the current year’s allocation of just over ₱66 billion, which includes ₱30.7 billion in counterpart funds and ₱35.3 billion in loan proceeds.

Regarding the Metro Manila Subway project, Dizon acknowledged that ROW issues had caused delays, although most have already been resolved.

“One problem is left, which is the Ortigas station, and it should be resolved very soon,” he added.

The DOTr chief also committed to complete the railway from Valenzuela to Clark before the President’s term ends in 2028.

Although the DOTr does not have a specific budget allocation, Dizon assured that its funding for next year will be maintained.

On the sidelines of the Japan Overseas Cooperation Volunteers (JOCV) 60th anniversary reception on Thursday, Aug. 28, Baba told Manila Bulletin that ROW acquisition is a more complicated issue than budget concerns, as it involves legal processes, documentation, and relocation of affected residents. “This is not controlled by the government itself,” he noted.

Baba emphasized that even after budget allocations are secured, ROW remains the “biggest” challenge to the smooth progress of infrastructure projects like the Metro Manila Subway. He said construction at some critical locations has not yet started due to pending relocations.

While JICA Philippines does not have specific data on how much ROW remains to be acquired for the railway projects it funds, Baba said these unresolved matters are now receiving focused attention.

The JICA Philippines chief welcomed statements from the Marcos Jr. administration’s economic managers indicating that earlier budget issues involving foreign-funded projects are now being addressed.

“Now, the country, your government is discussing much more seriously how to improve this kind of situation. Of course, the national budget is one of the aspects, but also, they [should address] smooth processing and ROW.”

Baba earlier cited the difficulties being faced by Japanese contractors, who have been unable to collect payments from implementing government agencies due to a lack of budget coverage, despite needing to pay their local subcontractors.

As a result, both Japanese contractors and their subcontractors face payment delays because of the slow release of funds from Philippine agencies.

While they have not calculated the total amount owed by the Philippine government to Japanese contractors for JICA loan-funded projects, Baba had nodded when asked if it was likely a substantial sum.

Despite these setbacks, the JICA Philippines chief had said that Japanese companies remain committed to fulfilling their contractual obligations, sometimes borrowing from banks to keep the projects moving forward.

However, he had cautioned that these challenges could affect contractors’ willingness to participate in future projects.

Still, Baba had described these delays as a “legacy issue” that has persisted across multiple administrations, not just the current one.

Under the Philippines’ loan agreements with JICA, Japanese firms or joint ventures (JVs) involving them are given priority in being hired as contractors, suppliers, or consultants for loan-funded projects.

(Ricardo M. Austria with Ben Arnold de Vera)