By Diplomacy Journal Lee Jon-young
President Yoon Suk-yeol held a summit with Philippine President Ferdinand Marcos Jr. on Oct. 7 (local time) and agreed to expand economic cooperation, including cooperation on “mega-infrastructure” worth about $2 billion (2.69 trillion won), and strengthen cooperation in the defense and security fields.
The two countries also upgraded their bilateral relationship to a “strategic partnership. This is the first formal bilateral relationship in 75 years of diplomatic relations between the two countries.
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 on Oct. 7, 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 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 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 project 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.
It also opens up new possibilities for Korea’s nuclear power exports. “The two leaders noted the importance of nuclear power as a carbon-free energy source and decided to strengthen the foundation for bilateral cooperation on nuclear power with the signing of the MOU on the feasibility study for the restart of the Bataan Nuclear Power Plant,” said President Yoon.
“The two leaders also agreed to promote bilateral trade and investment by promptly implementing the Korea-Philippines Free Trade Agreement (FTA), which was signed in September last year,” Yoon said.
Cooperation in the security sector will also be strengthened in the areas of defense and maritime affairs. “South Korea will actively participate in the third phase of the Philippines' military modernization project,” Yoon said, adding, ”We will also strengthen cooperation in maritime security, such as countering transnational crime at sea, information exchange, and search and rescue.”
North Korea was also condemned in unison. “We reaffirmed that the international community will never tolerate North Korea's nuclear development, reckless provocations, and illegal Russo-DPRK military cooperation, and we will continue to work together for the denuclearization of North Korea and the faithful implementation of Security Council resolutions,” Yoon said.
