Panama has signed a deal with Japan to secure $2.6 billion in financing for the construction of a third metro line in the Central American nation's capital.

The line will run from central Panama City west across the Panama Canal to link the capital with western suburbs.

Construction is expected to begin next year with a late 2021 target date to begin operations. The first phase envisions nearly 17 miles (27 kilometers) of track and 14 stations.

The financing deal was signed Wednesday during a trip by President Juan Carlos Varela to Japan. Varela called the agreement "a recognition of Panama's solidity and credibility."

Last year the government began construction of Line 2 to the east of Panama City, with an estimated cost of about $1.9 billion.