The Philippines' Department of Transportation has signed a 142 billion peso (US$2.76 billion) deal with Chinese contractors to build a railway connecting provinces in southern Luzon island.

The main package of contracts for the Philippine National Railways' South Long-Haul Project (also known as PNR Bicol) has been awarded to a joint venture made up of China Railway Group, China Railway No. 3 Engineering Group, and China Railway Engineering Consulting Group.

Present at the signing were Philippine transportation secretary Arthur Tugade and China's Ambassador to the Philippines Huang Xilian. The railway is a flagship project of President Rodrigo Duterte's Build, Build, Build infrastructure initiative.

The initial 380-kilometre line runs from Calamba City in Laguna province to Legazpi City in Albay province. There will be 23 stations, 230 bridges, 10 passenger tunnels and a depot in San Pablo, Laguna.

It will be the longest line operated by the PNR. Additional phases will expand PNR Bicol to 565 kilometres. Passenger trains will run at speeds of up to 160 kilometres per hour.

The Chinese joint venture will be responsible for the design, construction, and electromechanical works. Now that the contracts have been signed, talks can begin on an Official Development Assistance (ODA) financial package from China.

Two other infrastructure projects, the Subic-Clark Railway and the Mindanao Railway, are being funded through China's ODA.

The Subic-Clark Railway project is a component of the PNR Luzon System Development Framework providing initial freight service between the Subic Bay Freeport Zone and the Clark Freeport and Special Economic Zone, linking Subic Port with Clark International Airport and other major economic hubs in Central Luzon, especially New Clark City, and forming an integrated logistics hub for the development of Central Luzon as a new growth centre to decongest Metro Manila.