STALLED railway projects in the Philippines have revived questions about the country's decision to drop Chinese financing, with a geopolitical analyst arguing that the government risks missing out on economic opportunities as other Southeast Asian countries advance China-backed projects.
Herman Tiu Laurel, president of the Asian Century Philippines Strategic Studies Institute, said the Philippines was being left behind by its neighbors in a forum on Friday, citing railway developments in Laos, Indonesia and Malaysia.
His assessment comes as the Mindanao Development Authority (MinDA) explores possible private-sector investment in the long-delayed Mindanao Railway Project, including potential participation by China Civil Engineering Construction Corp. (CCECC).
MinDA Chairman and Secretary Leo Tereso Magno met with CCECC representatives on Oct. 9 to discuss potential investments in the railway and other sectors, according to a SunStar Davao report published Wednesday. Magno encouraged the Chinese company to identify a railway segment it would want to pursue and consider submitting an unsolicited proposal.
The discussions, however, do not constitute a financing agreement or guarantee that construction will proceed.
The railway project is among three major infrastructure projects that had been lined up for Chinese financing before the government abandoned the loan arrangements. The other two were the Philippine National Railways' South Long Haul project, also known as the Bicol Express, and the Subic-Clark Railway.
In July 2022, the Department of Transportation said the Chinese government failed to act on the funding requests before their validity expired. The withdrawal of the loan applications prompted the government to reassess project funding.
In September 2023, the Department of Finance formally informed China that the Philippines was no longer pursuing Chinese official development assistance for the first phase of the Mindanao railway, covering the Tagum-Davao-Digos segment.
Laurel argued that the subsequent shift toward other financing partners contributed to delays in Philippine railway development. He questioned the government's decision to abandon Chinese financing and disputed arguments that Chinese loans were less favorable than Japanese financing.
The Mindanao railway remains without a firm financing commitment. MinDA has been seeking private investors, while the Department of Transportation has explored alternative funding sources for the project.
The proposed first phase would connect Tagum City in Davao del Norte, Davao City, and Digos City in Davao del Sur. The railway is intended to improve passenger travel and freight movement across the region, including transport of agricultural products to markets.
Laurel cited other Asean infrastructure projects as evidence of the potential benefits of Chinese-backed investment.
These include the China-Laos Railway, which links Kunming in China to Vientiane in Laos, and Indonesia's Jakarta-Bandung High-Speed Railway, which reduced travel time between the two cities from about three hours to 46 minutes.
He also cited Malaysia's East Coast Rail Link, a 665-kilometer railway expected to begin its first phase of operations in December 2026.
The Belt and Road Initiative, launched by Chinese President Xi Jinping in 2013, seeks to expand trade and connectivity through transport, energy and other infrastructure investments across participating countries.
Laurel said the Philippines had also lost potential benefits from the initiative's maritime component, the 21st-Century Maritime Silk Road, which connects ports and shipping routes across Asia and beyond.
He attributed the country's infrastructure difficulties partly to the Marcos administration's shift away from Chinese cooperation and toward the United States and its allies. He alleged that geopolitical considerations influenced the policy change, but did not present documentary evidence establishing a prior agreement between Washington and Manila to disengage from Chinese-backed projects.
The country's maritime disputes with China in the South China Sea have complicated bilateral relations, although the two countries continue to maintain economic ties.
Laurel called for reconsideration of infrastructure cooperation with Beijing, arguing that the Philippines should not forgo potential economic gains because of geopolitical rivalries.
