UK offers about P420B in funds for PH infrastructure projects

London has formalized a financing framework providing up to 5 billion pounds (about P419.9B) in potential support for priority Philippine infrastructure projects through its export credit agency, UK Export Finance (UKEF).

The agreement, signed on Wednesday with the Department of Finance during the visit of UK Trade Minister Anas Sarwar, establishes a framework through which UKEF support can be considered for eligible projects in the Philippines.

“(This) is a recognition of the positive work that’s happening here in the Philippines and the positive relationship that we have with the Philippines,” Sarwar said at a briefing late Tuesday following the second Philippines-UK Joint Economic and Trade Committee (Jetco) ministerial meeting.

Specific projects have yet to be identified, but Sarwar said both governments would work together to determine which could qualify for support.

The financing framework was among the key outcomes of the Jetco meeting that also produced a refreshed 12- to 18-month work program spanning agriculture, energy, infrastructure and economic development.

Both countries are also exploring cooperation in grid modernization, civil nuclear energy, trade digitalization and space.

DCTS utilization

On trade, Manila is seeking to make greater use of the UK’s Developing Countries Trading Scheme (DCTS), under which Philippine exports enjoy preferential access to the British market.

Trade Undersecretary Allan Gepty said around 99 percent of Philippine exports to the UK by value are covered by the scheme, along with about 92 percent of tariff lines. However, the DCTS utilization rate stood at only 68 percent in 2025.

“If we can make it at 100, then of course better,” Gepty said at the same briefing.

Closing that gap would require information and awareness campaigns as well as capacity building for exporters and micro, small and medium enterprises, he added. The two countries also plan trade promotion, business matching and technical exchanges on UK market access requirements.

Agricultural cooperation will meanwhile expand into aquaculture, biotechnology, animal and plant health and climate-resilient agriculture. Manila and London plan to formalize a memorandum of understanding consolidating their agriculture initiatives.

In energy, the UK will continue supporting Philippine offshore wind development, while both sides will explore cooperation in civil nuclear energy, radioactive waste management and grid modernization, including smart grids and microgrids.

In 2025, the UK was the Philippines’ 23rd-largest trading partner, 19th-largest export market and 22nd-largest source of imports.

Trade

Bilateral trade in goods reached $1.1 billion that year, comprising $537 million in Philippine exports and $613 million in imports.

Among the Philippines’ top exports to the UK are digital monolithic integrated circuits, input or output units, automatic data processing machines, aircraft parts, tuna, skipjack and bonito. Transistors, meanwhile, are the Philippines’ top import from the UK.

While both countries are seeking to deepen trade ties, Gepty said there were currently no talks toward a bilateral free trade agreement.

Instead, Manila is pursuing accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), of which the UK is already a member.

Gepty said that among CPTPP members, the Philippines does not currently have an FTA with Mexico, the UK and Peru, making London a “potent” partner and one of the thrusts for Manila in seeking membership in the trade bloc.