POBLACION, Makati City — The lack of actual appropriation in the 2025 budget for the funding of the defunct Makati Subway Project has cast doubts on the settlement agreement between the Makati City government and Philippine Infradev Holdings Incorporated (InfraDev).

According to Makati's newly installed city administration, it has uncovered an ₱8.96-billion settlement agreement over the terminated subway project, which was approved by the previous administration just days before it left office.

Based on official documents, the outgoing city council passed Resolution 2025-031 on June 20, authorizing the settlement, which was formally signed on June 23. The agreement requires the city to pay InfraDev US$160 million or ₱8.96 billion, within 90 days of receiving a consent award from the Singapore International Arbitration Centre (SIAC).

“This agreement places the financial health of the city at serious risk,” former senator and now Makati mayor Maria Lourdes 'Nancy' Binay-Angeles pointed as as she noted that “there was no due diligence made to determine whether the city had the capacity to fulfill th(e) massive obligation.”

The settlement stems from arbitration proceedings filed by InfraDev following the Supreme Court’s 2021 ruling that transferred jurisdiction over key portions of the subway route to neighboring Taguig City. The decision effectively derailed the flagship infrastructure project, which was launched under a 2019 Joint Venture Agreement and had seen significant investment from InfraDev through its local subsidiary, Makati City Subway Inc. (MCSI).

Prior to the latest developments, the project had progressed through feasibility studies, engineering design and initial construction before the jurisdictional shift forced a reassessment of its viability.

Now, under the terms of the settlement, Makati not only must pay the multi-billion-peso amount but also return 722,320,940 preferred shares in InfraDev. In exchange, the city would acquire all of MCSI’s shares and assume ownership of partially completed infrastructure components related to the subway.

However, a July 3 certification from the City Budget Department confirmed there is no appropriation in the city’s 2025 budget to fund the settlement, casting doubt on the deal’s feasibility and compliance with fiscal safeguards.
Mayor Binay expressed grave concern over the financial implications, warning that fulfilling the agreement could cripple city programs and disrupt basic services.