Panama has signed a $2.6bn agreement with Japan to finance the construction of Line 3 of Panama's Metro.

Touted be the largest project in Panama since the expansion of the Panama Canal, Line 3 of the Panama Metro will be 26.75km long with 14 passenger stations.

The first phase of Line 3 will meet the demand of 20,000 daily commuters in rush hour in 2020, while the second phase of Line 3 will benefit 31,862 commuters in 2050.

Panama president Juan Carlos Varela said in the joint press conference with the prime minister of Japan Shinzo Abe: "The funding granted today by Japan is a recognition of Panama's credibility, stability, and strength. Today's announcement proves that our economy is sustained by solid foundations."

The contractor for this project will be chosen through an international public bidding. Construction work will commence in 2017 and the metro line is set to be operational by the end of 2021.