In April, the Philippines, the United States, and Japan have recently announced a significant partnership for the development of the Luzon Economic Corridor. The move aims to accelerate investments in critical sectors like railways; modernized ports; clean energy and semiconductor supply chains and deployments; and agribusiness, among others, bringing these high-impact projects into the future.
Unveiled during the historic trilateral summit of President Ferdinand R. Marcos, Jr. with US President Joe Biden and Japanese Prime Minister Fumio Kishida at the White House in Washington, D.C., the planned development of the Luzon Economic Corridor is the latest addition to the Partnership for Global Infrastructure and Investment (PGII) founded by the G7 countries and marks the first such initiative in the Indo-Pacific region.
This, however, was only the continuation of a deepening relationship between the three countries since the start of the Marcos administration. In 2023, the first-ever meeting of the national security advisors (NSAs) of the United States, Japan, and the Philippines took place in Tokyo, with the United States reaffirming its “ironclad alliance commitments” to both countries. All three NSAs agreed to enhanced trilateral cooperation and response capabilities since then.
The joint statement issued by Messrs. Marcos, Biden, and Kishida highlighted the importance of this collaboration, stating, “Our three nations are proud to partner on the first Partnership for Global Infrastructure and Investment corridor in the Indo-Pacific. Today, we are launching the Luzon Economic Corridor, which will support connectivity between Subic Bay, Clark, Manila, and Batangas in the Philippines.”
“The Luzon Corridor is a demonstration of our enhanced economic cooperation, focused on delivering tangible investments across multiple sectors. Japan, the Philippines, and the United States are also partnering to expand cooperation and investments in other areas of the Philippines.”
Furthering the alliance is the US International Development Finance Corp.’s intention to open a regional office in the Philippines to facilitate further investments across the country. Japan, meanwhile, through the Japan International Cooperation Agency (JICA), will continue to support connectivity in the area, including rail and road projects, as they have in the past.
Messrs. Marcos, Biden, and Kishida also emphasized the need for close coordination in dealing with “economic coercion,” aiming to promote enduring, inclusive economic growth and resilience in their countries and the broader Indo-Pacific region.
“We are pursuing economic projects that advance our shared objectives: promoting broad-based and sustainable economic growth, and investing in resilient, reliable, and diversified supply chains,” the joint statement said.
Strengthening Philippines-Japan economic and security relations
Japan has long been an ally to the Philippines particularly in economic, security, and social development through the Philippines-Japan Economic Cooperation Agreement (PJEPA), which entered into force in 2008 and acts as the cornerstone of the bilateral relationship. Notably, the PJEPA is the first and only bilateral economic treaty signed by the Philippines, a symbol of its unique relationship with Japan.
For instance, in 2021, Japan was the Philippines’ second-largest trading partner and its third-largest export market. Japan has also provided Manila with consistent development assistance like concessional loans to finance important infrastructure and capacity-building projects, social safety-net programs, education, agriculture, and science and technology support.
This partnership was enhanced even further with the establishment of the Japan-Philippines High-Level Joint Committee on Infrastructure Development and Economic Cooperation in 2017, and again with both countries agreeing to accelerate negotiations on a Reciprocal Access Agreement (RAA) that facilitates procedures and sets guidelines for military forces visiting partner countries for training and joint exercises.
Part of the security cooperation between the two nations include humanitarian assistance and disaster relief. Historically, Japan had been instrumental in the recovery efforts during natural disasters like Super-Typhoon Yolanda (international name: Haiyan) in 2014.
Back then, Japan had sent its largest international emergency relief team to the Philippines, comprising of approximately 1,200 personnel) alongside Self-Defense Force destroyers, transport ships, supply ships, helicopters, and transport aircraft. This cooperation eventually led to the signing of “Terms of Reference” for HA/DR cooperation in February 2023.
Japan has also played a crucial role in peace-building and social-sector development in Mindanao through initiatives like the Japan-Bangsamoro Initiatives for Reconstruction and Development (J-BIRD). Launched in 2006, J-BIRD is a comprehensive initiative aimed at socioeconomic development in Mindanao. Japan’s commitment to providing aid even during times of heightened tension has earned the trust of various actors, including armed rebel organizations.
An example is in 2008 when Western aid organizations withdrew their employees due to the deadlocked peace process with rebel forces at the time, leading to a deterioration in security.
On the other hand, JICA stayed and expanded its staff, winning the confidence of MILF locally. This is one of the reasons that led to the decision to hold the first meeting between the President of the Philippines and the leaders of MILF in Japan in 2014.
Last year, President Marcos and Prime Minister Kishida also announced several economic agreements, including Tokyo’s pledge to provide ¥600 billion in development aid and private-sector investment to the Philippines through the end of fiscal 2023, with the sum aimed at supporting projects that would help the Philippines attain Upper Middle Income Country status by 2025.
Included in the agreements is a loan provided by Japan worth ¥377 billion for the development of the Philippines’ North-South Commuter Railway and its extension. Mr. Kishida also reiterated that they are ready to grant an additional loan for further maintenance and rehabilitation of the Metro Rail Transit Line 3.
Cooperation in agriculture, cybersecurity and people-to-people exchanges are also included in the deals, as well as the promotion of health care-related projects.
As these efforts continue to progress, the partnership between the Philippines and Japan is poised to become even more robust, contributing to the overall stability and prosperity of the Indo-Pacific region. It is an optimistic sign for both countries as the strengthening collaboration of the two nations opens up opportunities that could bear fruit even in the far future. — Bjorn Biel M. Beltran
