The Japanese Government has signed a $202.04m loan agreement to support construction and upgrade of roads in conflict-affected areas in Mindanao, Philippines.

The deal was signed during the eighth meeting of the Philippines-Japan Joint Committee on Infrastructure Development and Economic Cooperation held in Pampanga, reported Philippine News Agency (PNA).

In a statement published by PNA, Philippines Finance Secretary Carlos Dominguez III said the loan will cover 176.6km of access roads that connect the Bangsamoro Autonomous Region in Muslim Mindanao to Mindanao’s trade centres.

Rehabilitation of road network will boost local economies, support easy accessibility and flow of goods and services to and from these areas.

Under the agreement, funding will be used for consulting services and civil works.

Dominguez was quoted by CNN Philippines as saying: “The Japanese Government is the largest donor or source of funds for our Marawi rehabilitation and they mentioned that if there is more needed they are willing to provide the funds.

“Both sides also discussed the strategy for future cooperation considering that the Philippines will soon graduate to upper middle-income status by the end of this year or 2020.”

Japanese and Philippines officials have also agreed to sign a supplemental loan for the ongoing Davao City Bypass Construction Project later this year.

In addition, they also committed to signing loan agreements for the New Mactan Bridge construction project in Cebu.

Furthermore, agreements for funding the Metro Manila Priority Bridges Seismic improvement project’s second phase and the second part of the loan for Metro Manila Subway Project’s first phase will also be signed this year.