On October 7, during the Korea-Philippines summit held in Manila, Philippines, Deputy Prime Minister Choi Sang-mok and Philippines’ Finance Secretary Ralph G. Recto signed a memorandum of understanding (MOU) for the Laguna Lake circular road and the Panay-Guimaras-Negros (PGN) bridge construction projects, in the presence of the leaders of both countries. In addition, a loan agreement for the second phase of the Samar Pacific Coastal Road project was also signed during the summit.

Both Laguna Lake circular road and PGN bridge construction projects are mega landmark projects, each of which received the record $1 billion EDCF[1] loan, ranking as the first and second largest projects in the fund’s history. These projects will proceed through competitive bidding limited to Korean companies, supporting their expansion into infrastructure markets of the Philippines and Southeast Asia.

First, the Laguna Lake circular road construction project (Phase 1) involves building a circular road consisting of elevated roads and embankments along the western shoreline of Laguna Lake, near the capital, Manila. This project is expected to address the rapidly increasing traffic demand in the area, enhancing its economic growth potential. The EDCF will provide $905 million to support 7.9 kilometers of the project, which spans a total of 37.5 kilometers.

Second, the PGN construction project aims to build a bridge connecting three islands (Panay, Guimaras, and Negros) in central Philippines. By constructing this bridge in an area that accounts for over 50% of the Philippines’ tourism revenue, the project is anticipated to improve transportation convenience between the islands, boost the tourism industry, and elevate the living standards of local residents. The EDCF plans to provide over $1 billion for the construction of the first bridge (connecting Panay and Guimaras Islands, totaling 13km), marking the first mega project in the fund’s history to exceed $1 billion.

The government is promoting the expansion and enhancement of Official Development Assistance (ODA) to fulfill its responsibilities and roles as a global pivotal state, enabling support for single projects exceeding 1 trillion won. This development will serve as a catalyst for the successful bidding of Korean firms in future projects, further facilitating their entry into global markets.

The subsequent loan agreement[2] for the second phase of Samar Pacific Coastal Road project ($110 million) involves the construction of two new bridges and the renovation of roads (13km). This projects is a continuation of the first phase, completed in 2023, which is a key initiative for the Philippines, evidenced by the attendance of the Philippine president at the completion ceremony. The successful completion of the second phase is expected to significantly shore up bilateral ties.

Going forward, the government plans to actively link the EDCF with external strategies to strengthen cooperation with key partner countries, such as the Philippines, which have high potential for economic partnership, while exploring large-scale projects to support the overseas expansion of Korean businesses.