The Philippines—one of the three main partners alongside the United States and Japan—houses the Luzon Economic Corridor (LEC), which stretches across the central and northern parts of Luzon. The LEC encompasses key urban and industrial areas, including Metro Manila, CALABARZON, and Central Luzon. These areas make the LEC strategically significant as a hub for commerce, industry, and logistics, supporting economic growth and regional development.

Metro Manila is the epicenter of the Philippine economy, contributing approximately 36% of the country’s GDP. Batangas, part of the CALABARZON region, is a major industrial and manufacturing hub, contributing around 17% of national GDP. Central Luzon likewise contributes 9% of national GDP and plays a pivotal role in agriculture, logistics, and emerging industrial activities.

Given the economic importance of these areas, the Philippine government is prioritizing infrastructure development through the “Build Better More” program. The program aims to strengthen connectivity and support the region’s economic prospects through policies that improve the ease of doing business and attract foreign investment.

The United States, in coordination with the Philippines and Japan, is making significant contributions to the development of the Luzon Economic Corridor (LEC). Through the U.S. Trade and Development Agency (USTDA), grant funding for the pre-feasibility study of the Subic-Clark-Manila-Batangas (SCMB) Cargo Railway increased from USD 2.5 million (PHP 138.8 million) to USD 3.8 million. The study aims to improve logistics operations, reduce transport costs, and create jobs for thousands of Filipinos.

Alongside this effort, the U.S. is working with the Organization for Economic Cooperation and Development, in collaboration with Arizona State University, to conduct a comprehensive assessment of the Philippine semiconductor ecosystem. The initiative aims to strengthen the Philippine workforce and help the country double the number of its semiconductor facilities.

Beyond these initiatives, the U.S. government intends to use U.S. government tools to identify and address investment barriers in key sectors, including the Luzon corridor. This effort will draw on the PGI-IPEF Investment Accelerator’s model of creating investment corridors that bring together public and private capital.

Japan, one of the three main collaborators in the Luzon Economic Corridor (LEC), is supporting the development of key transport, trade, and digital infrastructure. A major initiative is the North-South Commuter Railway (Malolos-Tutuban), a modern passenger rail connecting Calamba to Clark International Airport via Manila. The project will improve workforce mobility, ease road congestion, and support economic activity across Metro Manila and Clark.

Japan is also funding a 30-year Railway Master Plan for the Greater Capital Region to guide the development of its railway network through 2055. It is further supporting railway capacity building through technical cooperation with the Philippine Railways Institute and the Metro Manila Development Authority on intelligent transportation systems.

On trade and investment, Japan and the Philippines have emphasized the full implementation of existing agreements, including the Philippines-Japan Economic Partnership Agreement, the ASEAN-Japan Comprehensive Economic Partnership, and the Regional Comprehensive Economic Partnership. Japan also supports the Philippines’ planned accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

For digital connectivity, Japan is providing Official Development Assistance (ODA) to support high-quality, resilient, and sustainable infrastructure. This includes cooperation on digital infrastructure, such as undersea cables and 5G Open RAN technologies, as well as efforts to promote secure and trustworthy AI through the Japan-ASEAN Co-creation Initiative for AI.