President Marcos Jr 5th State of the Nation Address from A-Z

What Marcos said in his fifth SONA, from A-Z

Cristina Chi  
Philstar.com
July 28, 2026

MANILA, Philippines — President Ferdinand Marcos Jr. used his fifth State of the Nation Address to address two crises that tested his administration in the past year: the corruption scandal in flood control works, and the economic fallout from the shutdown of the Strait of Hormuz amid the war in the Middle East. 

Marcos devoted the opening portion of his speech to vowing full accountability in the corruption scandal that had rocked the government in 2025. He told Congress that his own cousin, former House Speaker Martin Romualdez, could soon be jailed over anomalous flood control projects, and that nearly P25 billion has been recovered or frozen from the accused.

The president also departed from his prepared speech at least twice to make his biggest economic announcements: a demand to amend the EPIRA law so consumers stop paying for power firms' systems loss, and a three-part tax relief package for the middle class.

Here, we break down Marcos' 2026 SONA into easily digestible topics from A to Z.

Arbitral Award

Marcos marked the 10th anniversary of the 2016 arbitral ruling on the South China Sea, calling it "a definitive benchmark for the interpretation and application of the UNCLOS" and vowing to use "every peaceful and legal means available to the Republic against any attempt, foreign or domestic, to undermine this achievement."

"This is not a claim that we advance alone, nor one that we will abandon," he said, honoring the military, the Coast Guard and fisherfolk who "give life to the letter and spirit of the Arbitral Award."

Without naming any country, the president pushed back against what he called a threat "directed against our dignity and self-respect as a people." He said: "We are not greedy. We are not racists. We are not liars... We are Filipinos, and we do not yield."

Context: China Daily, the Chinese state-run outlet, posted an AI-generated video on Facebook on the July 10 arbitral award anniversary depicting Filipinos as monkeys. The video specifically showed a monkey in Filipino attire, directed by arms representing the United States and Japan, called "stupid," holding a sheet reading "South China Sea arbitration award."

Bigas

Marcos said the government distributed more than 26,000 metric tons of rice to over 2.5 million families as incomes plunged during the oil price crisis, and will keep going until 8 million families are reached.

The "Benteng Bigas Meron Na" program — the P20-per-kilo rice initiative Marcos rolled out nationwide last year — is now benefiting more than 12 million Filipinos, he said, while over 800 KADIWA outlets let farmers and fisherfolk sell directly to consumers.

The government also capped the price increase of imported rice during the emergency, Marcos said, and nearly two million farmers and fisherfolk received aid under the Presidential Assistance to Farmers, Fisherfolk, and Families at the height of high fuel prices.

Campus violence 

Marcos expressed condolences for the students who died in the Tacloban school shooting, one of the deadliest campus violence incidents in recent history.

In his speech, Marcos offered condolences to their families and paid tribute to the three student casualties by name — Chris Lorenz Fabian, Joyancee Separa and Ayessa Nicole Dazo. Marcos hailed their "unflinching bravery and heroic virtue" and said they "are an inspiration to us all."  

In response, the president said the first batch of 10,000 School Counsellor Associates will be deployed to public schools, while local governments, barangays, the police and the Department of Education will jointly tighten campus security. 

Disaster response 

Marcos said the government aided more than 600,000 families after the recent earthquake in the Visayas and Mindanao. The government also poured over P3 billion into food, medical care, financial aid and housing, he said.

Additionally, with the new concept of a State of Imminent Disaster, Marcos said, "we will no longer wait for calamity to strike" before acting.

EPIRA

In one of the speech's biggest unscripted moments, Marcos demanded that Congress amend the Electric Power Industry Reform Act to stop power firms from passing systems loss charges — and the VAT on top of them — to consumers.

"It's not the consumers' fault that there are systems losses, so it's not right that they're made to pay for it," he said, adding: "We the people request, no, we demand for the immediate amendment of the EPIRA to prohibit charging systems loss against consumers, including the Value-Added Tax thereon."

System loss refers to electricity lost to technical leakage and pilferage as power moves through the grid. Under EPIRA, enacted in 2001, distribution utilities are allowed to recover these losses from customers, subject to caps set by the Energy Regulatory Commission. This means system loss charges are a line item that has long appeared on every household's monthly bill.

Flood control

A year after Marcos stood at the same rostrum to vow his government would stamp out corruption in flood control projects, he reported that so far several contractors, senior Department of Public Works and Highways officials and lawmakers have been charged and jailed.

Nearly P25 billion in money and assets of the accused have been recovered, frozen or preserved, Marcos said, with more than P800 million already returned to the Treasury. The government also stopped payments for "defective, fake, or ghost projects" that would have gone to corrupt contractors and officials.

Prosecution now rests with the Ombudsman and a strengthened National Prosecution Service. "You can count on it: the wheels of justice are turning," Marcos said in Filipino.

 Without mentioning him by name, Marcos also said the Ombudsman would soon be filing "case after case (patong patong na kaso)" against former House Speaker Martin Romualdez, his cousin.

Romualdez has been accused by the Ombudsman of being the central mastermind of a kickback scheme that allegedly ran wild during his term as House speaker. 

GAMOT

Under the GAMOT program, PhilHealth members can now claim essential medicines from more than 2,000 accredited providers, with a benefit limit of P20,000 per member per year, Marcos said.

The list now covers 75 medicines — antibiotics and drugs for asthma, hypertension, cholesterol, diabetes, cough and fever — and more than 300,000 Filipinos have availed in the first seven months of the year.

Hormuz

The war that closed the Strait of Hormuz — the passage that carries roughly a fifth of the world's oil — dominated Marcos' year and the economic part of his speech. 

The Philippines, which imports nearly all its crude, scrambled for alternatives, and Marcos said supply was secured through purchases from Japan, South Korea, Oman, India, Russia and China, a stockpile he put at nearly two months' worth.

He claimed pump prices were well-managed and price increases were spread over a week with oil firms' cooperation. Marcos recalled Congress passed a law suspending excise taxes on LPG and kerosene for three months.   

Marcos said the government negotiated with Iran for the safety of thousands of Filipino crew members aboard vessels in the strait. But elsewhere in the speech, Marcos acknowledged that a number of Filipinos have died or remain missing in the Middle East.

"Everything that could possibly be done to bring prices down and slow their rise, we did," he said in Filipino, adding that the government has even been "admired" for the speed of its response. 

Support programs are funded at more than P60 billion through year-end, Marcos said. 

Investments

Marcos said more than P6 trillion in investments have been "facilitated" through Green Lanes over the past three years — the fast-track approval process his administration created in 2023 for projects it deems strategic.  

An important caveat, however, is that this figure counts approvals, not money that has been funneled into programs. Marcos did not say how much of the P6 trillion has actually broken ground or begun operating, and the 400,000 jobs he cited are, by his own phrasing, "estimated to create."

The Philippines now counts 23 free trade agreements, Marcos said, though that tally lumps together deals in force with those still under negotiation.

Jobs

On Labor Day, at the height of fuel prices, the government mounted nearly 100 fairs nationwide where some 300,000 jobs were advertised, Marcos said. Of those, just over 6,000 people were hired on the spot.

Marcos said the fairs will continue nationwide for displaced workers.

Kuryente

Electricity prices spiked in June on costly fuel prices and a strong dollar, Marcos acknowledged.

The relief Marcos cited was relatively modest and temporary: power firms were ordered to refund customers they had overbilled — money those customers were owed in the first place — while "select" consumers were allowed to pay bills in installments from May to July, with disconnections banned only while those installments were being paid.

Ligtas Pinoy Centers

Construction begins this year on Ligtas Pinoy Centers — evacuation buildings designed, Marcos said, to withstand a super typhoon with 340 kph winds and a magnitude 8.4 earthquake — starting in disaster-prone Bicol, Eastern Samar, Bukidnon and Davao de Oro.

Middle-class tax relief

In another major ad-lib, Marcos asked Congress to pass a three-part tax relief package for the middle class and small businesses.

First, expand the income tax exemption to cover workers earning up to P350,000 a year, alongside "corresponding reductions" in income tax for other workers. Second, exempt small businesses from the minimum corporate income tax. Third, grant an amnesty on unpaid income, estate and value-added taxes, including the penalties attached to them.

"As distinct protection for them, and so they get more out of their hard-earned income, I call on Congress to pass a law giving some relief on our tax dues," Marcos said in Filipino.

Under the TRAIN law of 2018, annual taxable income of P250,000 and below is exempt; Marcos' proposal would raise that floor by P100,000. 

Nuclear and natural gas

"Perhaps it is time for us to revisit nuclear energy production," Marcos said, while saying the country already uses nuclear technology in medicine, agriculture, water filtration and the upcycling of plastic. 

He said he is confident nuclear power can shore up the country's energy security and bring down electricity costs, and promised it would be safe and properly explained to the public.

The president also touted what he called "truly a national treasure": an untapped reserve of 222 billion cubic feet of natural gas found after Malampaya drilling resumed for the first time in eight years, following the extension of its service contract to 2039. He said the find can keep the country's premier gas field producing until 2034 and is enough to power 1.6 million households for eight years.

OFWs

With more than 2.5 million Filipinos working in the Middle East, Marcos said the government has brought home more than 12,000 of them safely since the war erupted, while over 140,000 others received food, cash, medical care and shelter amid the fighting.

Marcos also said nearly seven million OFWs are now insured, and that the government raised the minimum wage for Filipinos working abroad as domestic helpers. He acknowledged that some Filipinos have died or remain missing in the Middle East.

Pax Silica

Briefly, Marcos also touted the Pax Silica Industrial Hub, a product of the 23-member, US-led Pax Silica Initiative, saying it will create an ecosystem with AI at its core. 

A strategic component of the Luzon Economic Corridor, the hub will serve as an advanced manufacturing and logistics center in the global AI and technology value chain, Marcos said.

Context: Pax Silica, launched in Washington in December 2025 to secure supply chains for AI, semiconductors and critical minerals — and widely read as a counter to China's dominance in the sector — has drawn both interest and criticism since the Philippines joined in April, with a formal signing eyed in November. The government has offered around 1,620 hectares in New Clark City in Capas, Tarlac for the planned hub.

Supporters say it could turn the country into a regional technology hub, but farmers' groups, environmental advocates, and Indigenous Peoples' organizations have raised alarms over the projected power and water demands of data centers, possible mining expansion and displacement, and fears the Philippines will be locked into supplying raw materials and low-cost assembly work. 

Quezon City's new train line

Twelve stations of the MRT-7 will open next year — the first new MRT line in nearly three decades — running from North Avenue to Sacred Heart in Quezon City, and eventually to San Jose del Monte, Bulacan. Marcos said the line will serve almost a million passengers a day.

Rocket

The Philippines is going to space — or at least, launching toward it. Marcos said Cagayan is "geographically and economically primed" to host the country's first spaceport, with a sounding rocket launch test slated for next year in partnership with a South Korean aerospace company.

"Yes, we are going to launch a rocket into space," Marcos said, drawing applause.

SSS

Around 44 million Filipinos are now covered by SSS since the start of the administration, Marcos said, including more than 80,000 drivers, vendors, gig workers, job order and contract of service personnel, and others from the informal sector.

SSS pensioners got their 10% pension increase in June, three months ahead of its September schedule, while retired uniformed personnel saw their pensions and subsistence allowance raised this year.  

Teachers

More than 80,000 public school teachers and school heads have been promoted under the Expanded Career Progression system, Marcos said. He said this makes good on his promise in last year's SONA that no teacher would retire as Teacher I. 

Over 30,000 positions have been added to grow the teaching force, Marcos said.

Utang

Agrarian reform beneficiaries will be free of their debts by the end of the year, Marcos said, as the government continues to write off what they owe.  

The administration has handed out more than 400,000 land titles covering upwards of 500,000 hectares in four years, the president said, and will finish distributing the rest next year.  

Marcos then turned to his agrarian reform secretary with a playful jab: don't think about retiring yet. "You still have a lot of work to do at the DAR," Marcos said in Filipino. 

Context: Marcos signed the New Agrarian Emancipation Act (Republic Act 11953) in 2023. This law condoned P57.55 billion in unpaid principal amortizations, interest and surcharges for over 600,000 agrarian reform beneficiaries.

While peasant groups like the Kilusan ng Magbubukid ng Pilipinas welcomed the signing of the law in 2023, they believe debt condonation alone is not enough to cure the landlessness of farmers.

Vehicles

The government has scrapped all tariffs on electric vehicles until 2028 to pull prices down, Marcos said, and ordered agencies to prioritize EVs when replacing their fleets.  

The president expressed hope in an ambitious target of having half of all vehicles in the country running on electricity by 2040.

Marcos also asked the industry to get behind the long-delayed public transport modernization program, promising it would be carried out humanely and fairly.

Waste

Marcos called for updating the 25-year-old Ecological Solid Waste Management Act to catch up with modern practices in waste disposal.

"As we recalibrate our solid waste management systems, we can draw inspiration from the solid waste management practices being championed by the MMDA here in Metro Manila, such as waste recovery, processing, and upcycling," Marcos said.

He held up the MMDA's waste recovery, processing and upcycling as a model, including the former Carmona sanitary landfill of the 1990s, now the MMDA Nature Park and soon a base for disaster-preparedness training.

eXports

Philippine exports keep growing, Marcos said, from critical components supplied to the world's top tech companies to farm products like ube, coconut and bananas. 

There is now also an unexpected new venture: enoki mushrooms. 

Foreign investments "continue to pour in because of beneficial policies: those promoting ease of doing business and accelerating digital transformation that curbs red tape and corruption," Marcos said.

YAKAP

Marcos said 4.5 million of the 25 million Filipinos registered in Philhealth's Yamang Kalusugan at Proteksyon/Yaman ng Kalusugan Program (YAKAP) program have gotten check-ups this year. 

Starting next year, the program will gradually add blood tests and medicines to catch kidney, liver and thyroid disease and hepatitis B early.

Zero-balance billing

Since its launch after last year's SONA, the Zero-Balance Billing policy has let nearly three million Filipinos benefit from DOH hospital wards without paying a single centavo, Marcos said.

The Medical Assistance to Indigent and Financially Incapacitated Patients (MAIFIP) program, meanwhile, has registered more than eight million patients, Marcos said. It is now online as "e-MAIFIP" through the eGovPH app.

Families using PhilHealth benefits have climbed from over five million in 2022 to more than 7.5 million in the past year, Marcos added.

Philippines makes major natural gas discovery

Philippines makes major natural gas discovery

Kristina Maralit,Ed Paolo Salting,Allen Limos
Agence France-Presse 

The Manila Times
20 January 2026

(UPDATE) THE Philippines has struck natural gas at Malampaya East-1, the first major discovery in more than a decade, President Ferdinand Marcos Jr. announced Monday.

In a video message posted online, Marcos said this gives “fresh momentum to our efforts to secure a stable and reliable energy supply for the country.” The discovered reservoir is located about five kilometers east of the existing Malampaya field and estimated to contain around 98 billion cubic feet of gas in place.

This is equivalent to almost 14 billion kilowatt-hours of electricity per year that could supply electricity to more than 5.7 million households, 9,500 buildings or almost 200,000 schools.

Based on initial testing, the well flowed at 60 million cubic feet per day.

“This indicates that the well has the potential to produce even more, confirming it is a high-productivity resource comparable to the original Malampaya wells,” Marcos said in Filipino.

Aside from the natural gas, the discovery also includes condensate, a high-value liquid fuel that can help support the government’s efforts for the stabilization of the country’s power supply.

“We are proud that Filipinos led this drilling. Most importantly, they completed it without any accidents or environmental incidents,” the chief executive said.

“This is proof that when the government’s direction is clear and our partners are efficient, we can strengthen the country’s energy security,” he added.

Marcos said the achievement was made possible through the work of the SC 38 Consortium led by Prime Energy Resources Development B.V. in partnership with UC38, PNOC Exploration Corp., and Prime Oil and Gas Inc.

“This is proof that with responsible environmental protection and strong collaboration between the government and the private sector, we can achieve a more reliable energy supply for every Filipino,” he said.

Breakthrough

Prime Energy hailed the discovery of a new natural gas field as a breakthrough for Philippine energy independence.

“This gas discovery is a victory of the Filipino people. When we assumed operatorship, we committed to the president and the nation to breathe new life into Malampaya and revitalize the indigenous natural gas sector. Today, we are delivering on that commitment,” the firm said in a statement.

“We thank President Marcos for his leadership, particularly for approving the extension of SC38 and for the enactment of the Philippine Natural Gas Industry Development Act, which provides the stability and confidence needed to pursue continued exploration of additional gas resources,” it added.

Malampaya East-1 is a newly discovered reservoir, confirming the presence of 98 billion cubic feet of additional natural gas and associate condensate. Initial well date indicates volumes equivalent to around one-third of the remaining Malampaya gas volumes.

The next phase of the Malampaya 4 drilling involves the completion and testing of Camago-3, followed by the drilling of Bagong Pagasa exploration well. Malampaya 4 was certified a project of national significance. Since its inception, the Malampaya project has generated more than $13.9 billion in revenues for the government, while reducing dependence on imported fuel.

The Philippines has some of the region’s highest energy costs and faces a looming crisis as the Malampaya gas field, which supplies about 40 percent of power to Luzon, is expected to run dry within a few years.

The discovery, the first in more than a decade, suggested the potential to produce even more, Marcos said.

The Philippines — regularly affected by electricity outages — relies on imported carbon-belching coal for more than half of its power generation.

Energy stakeholders on Monday welcomed the discovery of natural gas at the Malampaya East-1 site in Palawan.

“This milestone is a testament to the world-class capability of Filipino engineers in securing our country’s energy future. Reliable power fuels our everyday life, including the lights in our homes, the continuity of work and enterprise, and the stability our schools, hospitals, and communities depend on,” Energy Secretary Sharon Garin said.

“With this discovery, we will pursue this opportunity with discipline, while maximizing value for Filipinos, upholding environmental stewardship, and ensuring that every milestone strengthens our national interest,” she added.

In line with this, the DOE said it will continue to work closely with the Malampaya consortium and relevant agencies to ensure timely, compliant, and transparent next steps, covering technical evaluation, development planning, and all required regulatory and environmental safeguards, so that potential benefits are converted into real, dependable supply for the grid when ready.

Prime Energy said the first natural gas discovery in Philippine territory in over a decade will help boost the existing field’s remaining recoverable volumes by an estimated 30 percent.

The Malampaya East-1 site is the first major milestone under the Malampaya Phase 4 Drilling Campaign, alongside the Camago-3 and Bagong Pag-asa wells.

Prime Energy is part of the Malampaya Consortium that operates the gas field together with its partners UC38 LLC, PNOC Exploration Corp., and Prime Oil and Gas Inc.

China Bank Capital Managing Director Juan Paolo Collet said the natural gas discovery is huge for the country in terms having enough energy supply in the next few years as there is a chance that there could be more natural gas in the other sites.

“This is a significant discovery that will contribute to national energy security. The additional supply should help make local gas-fired power plants more cost-efficient and competitive, which in turn could translate to cheaper and more reliable electricity for households and businesses. It’s also important to note that this is just one among a number of exploratory wells in the Malampaya area, so there is a chance of discovering more supply,” Collet said.

“Moreover, the latest discovery may encourage investor interest in other potential areas of natural gas deposits in the Philippines. There are major domestic banks who are ready to support the sector,” he added.

'Coal phaseout’

Meanwhile, a church leader has called for a “decisive coal phaseout,” saying the country should invest instead in renewable sources of energy that “serves communities.” Bishop Gerardo Alminaza, president of Caritas Philippines, cited in a pastoral letter on Jan. 18 the experiences of seaweed farmers on Semirara Island — home to the country’s largest open-pit coal mine — where crops allegedly damaged by coal dust and wastewater have wiped out their primary source of income.

“After decades of extraction and billions in profit, many families remain poor, exposed to risk, and uncertain about tomorrow,” Alminaza said.

He said the farmers’ cases were not isolated but part of a broader pattern in which pollution and restricted access to coastal areas forced families into poverty or displacement.

He challenged those who argue that coal is essential to national development and energy security, noting that the Philippines remains heavily dependent on imported coal while electricity prices stay high and vulnerable to global market volatility.

“Coal’s defenders speak of necessity; people live with the consequences. Coal is repeatedly justified as essential to national development and energy security. Energy security that depends on imported coal is neither secure nor just,” he said.

“The Church cannot bless an economy that survives by wounding the poor and exhausting creation. The time to end coal in the Philippines is now. To delay is to choose harm. To act is to choose life,” Alminaza said.

Philippines to host Asean 2026

Philippines to host Asean 2026

Third Anne Peralta-Malonzo
sunstar.co.ph
29 October 2025

THE Philippines will host the Association of Southeast Asian Nations (Asean) in 2026.

During the Kapihan with the Media in Kuala Lumpur, Malaysia on Tuesday, October 28, 2025, Marcos said the Philippines’ hosting of the 2026 Asean Summit will be “chill and hospitable.”

Marcos formally received the Asean chairmanship gavel from Malaysian Prime Minister Anwar Ibrahim during the symbolic handover at the closing ceremony of the 47th Asean Summit, marking the Philippines’ assumption of the Asean chairmanship next year.

The Philippines last hosted the Asean Summit in 2017.

“We are now in the process of putting together the different elements of where we think Asean should be focusing,” said Marcos.

“So one of the things is the COC (Code of Conduct), for example. Number one para sa atin. The other member states, that’s not as a big priority to them as it is to us. So, this is our chance to really promote that and to highlight that, and hopefully we will succeed,” he added.

The President was referring to the COC in the South China Sea being negotiated among Asean member states and China amid the ongoing dispute in the West Philippine Sea.

Marcos also welcomed the social media characterization of the Philippines as the “chill dude” member of the Asean, noting that it reflects the Filipino people’s well-known values of hospitality and friendliness.

“I’m glad that ang starting point natin, ang tingin sa Pilipino ay ‘yun na nga ‘chill’ at madaling kausap. That’s a big help pagka you’re trying to find consensus,” he said.

(I’m glad that our starting point is seeing Filipinos as ‘chill’ and easy to talk to. That’s a big help when you’re trying to find consensus.)

Marcos stressed that the Filipinos’ nature of being lighthearted and approachable continues to serve the country well, especially in international relations.

“I agree. Sa palagay ko naman totoo din naman na talagang ganoon ang Pinoy. Magaan ang ugali ng Pinoy talaga. And that is to our advantage,” he said.

(I agree. I also think it’s true that Filipinos are really like that — they have an easygoing nature. And that is to our advantage.)

“We will present always the best possible side so that we are met with the most possible successes,” he added. (TPM/SunStar Philippines)

Philippines ushers ASEAN in renewable energy investments

$27.7 billion: How the Philippines leads Asean in investments, green power push

Investments boom: 2024 saw a 28% jump in approved projects, as per DTI data

Jay Hilotin, Senior Assistant Editor
Gulf News (Saudi Arabia)
30 January 2025

Manila: The year 2024 broke records for investments, with approved projects hitting Php1.62 trillion ($27.7 billion), the Philippine Department of Trade and Industry (DTI) has confirmed.

Free energy from the sun: The Philippines's biggest winners in 2024 in wooing fresh capital were the energy and manufacturing sectors, as well as special economic zones. Renewable power led by solar-wind-batteries (SWB) secured Php1.38 trillion ($23.6 billion) in fresh inflows — a 40 per cent jump from 2023.Bloomberg

The bumper inflows exceeded the Php1.5 trillion initial target for the past year.

The Asean nation not only overshot its original aim: it was up 28 per cent, outpacing 2023’s Php1.26 trillion ($21.58 billion), outperforming neighbouring countries like Thailand and Malaysia in this metric.

The biggest winners in wooing fresh capital: renewable energy (RE) and manufacturing, among others, as per the Presidential Communications Office.

Green energy leads 

• The energy sector led the charge, securing Php1.38 trillion ($23.6 billion) — a massive 40 per cent jump from last year.
• Other booming sectors: air and water transport, mass housing, manufacturing, water supply, waste management, and real estate.

Economic zones

The Philippines, once dubbed as the "Silicon Valley" of South-east Asia, has lost its sheen due to power intermittency and high rates.

Now, it's plotting a comback, as the Philippine Economic Zone Authority (PEZA) also shattered expectations, raking in Php214.17 billion ($3.67 billion), surpassing its Php200 billion ($3.5 billion) goal for 2024.

Investment boom

Though officials didn’t directly link the surge to President Ferdinand Marcos Jr.’ global investment push, trade leaders credit his overseas trips for securing major deals. 

President His Highness Sheikh Mohamed bin Zayed Al Nahyan with Ferdinand Marcos Jr, President of the Republic of the Philippines, at Qasr Al Shati in Abu Dhabi in November 2024.

File photo | WAM

Australia: Marcos locked in $1.53 billion (Php86 billion) across renewable energy, clean tech, IT-BPM, and healthcare, plus an expansion of Victoria International Container Terminal (VICT).

Germany & Czech Republic: Fresh investments are rolling in, with PEZA reporting nearly Php75 billion — about 43 per cent of its annual target — linked directly to the international trade missions.

Vietnam: VinGroup pledged investments in EV battery production, fueling the government’s transport modernisation.

Japan: A sweet deal between local Auro Chocolate and retail giant Mitsukoshi will benefit 1,000 Filipino families, blending Davao’s cacao with Japanese flavours like matcha and miso.

What’s next?

Manila is doubling down on investment-friendly policies in 2025, ensuring the Philippines remains a top destination for business, innovation, and job creation, said Trade Secretary Cristina Roque.

“We will continue to refine and implement forward-looking policies that attract investments in these key industries, ensuring that the Philippines remains a prime destination for innovation and growth,” Roque was quoted as saying by the Presidential Communications Office.

With this momentum, the Philippines isn’t just catching up — it’s leading the pack in the Asean.

Challenges

The country is tackling a key challenge: energy security and high cost of power.

Policy makers are leading the drive with a mix of renewable energy (RE) expansion and mega gas-to-energy projects, potentially dislodging coal.

In 2024, the Philippines ramped up RE capacity: more than 4,000 megawatts (MW) of power projects came online, as per the Department of Energy (DOE).

In June, the agency approved the construction of 16 offshore wind farms, with an estimated potential capacity of 7,668 MW. 

In September, Danish firm Copenhagen Offshore Partners announced a $3-billion investment for the 1-gigawatt (GW) San Miguel Bay offshore wind power project in Camarines Sur, about 400km south-east of Manila.

Juice from this wind project will start energizing the power grid from 2028.

In November, the $3.4-billion integrated solar-battery project, claimed to be the “biggest-of-its-type-in-the-world” in a 3,500-hectare (35 sq km) land in Nueva Ecija and Bulacan, broke ground north of the capital, combining solar and batteries, able to power the equivalent of 2 million local homes.

The Philippines also announced 20 dams for hydro-electric power generation.

Earlier this month (January 2025), the Philippines and UAE sealed a $15-billion landmark solar-wind-batteries deal aimed to bolster the Asean nation’s renewable energy credentials.

Policy mandate

Policy has been tweaked, too: electricity suppliers are now mandated to increase their RE sourcing by at least 2.52 per cent annually starting in 2023, up from the previous 1 per cennt annual increase in 2020. 

Filipino business tycoons are turning into battery barons, ramping up megawatt-scale “power banks” – including ones on floating platforms, with container-size battery energy storage systems (BESS).

A key advantage: they can be quickly deployed where needed. More than 60 sites across the archipelago had been completed or in the roll-out stage.  

Global recognition  

While the Philippines still has one of the highest power rates in the region, the push for REs is hoped to bring rates down.

With companies like Aboitiz Power, ACEN, and Meralco scaling up solar farms and offshore wind, the Philippines landed second in the 2024 Climatescope Report by BloombergNEF, reflecting investor confidence in greening drive.

Will these moves push some — if not all — of the 60 coal-fired plants (with generating capacity of 12 GW) to retire earlier than planned?

It's early days.

The ramp in RE underscores Manila’s efforts to creating a greener, end-user and investor-friendly (and, hopefully, cheaper!) power eco-system.

PH to attract more investments at WEF 2025 meeting

Davos WEF reaffirms PH potential as global investment hub

By Zaldy De Layola

Philippine News Agency
January 26, 2025

MANILA – The country can expect more foreign investments following its participation at the World Economic Forum (WEF) Annual Meeting 2025 in Davos, Switzerland.

Speaker Ferdinand Martin Romualdez said the results of the productive engagements of the Philippine delegation would create more jobs to propel economic growth.

"The discussions we held in Davos reaffirm the immense potential of the Philippines as a key destination for global investments," Romualdez said in a news release on Sunday.

He said the team is grateful to President Ferdinand R. Marcos Jr. for sending a delegation that showcased the many reasons why global investors should choose the Philippines.

“The reception has been overwhelmingly positive and I am confident that this will translate to more investments that will fuel our economic growth,” he added.

Romualdez lauded the Philippine delegation composed of Finance Secretary Ralph Recto, Trade and Industry Secretary Trade Secretary Ma. Cristina Roque, and business leaders from various sectors for their significant contributions to promoting the country’s economic opportunities.

“I thank my fellow delegates for their tireless efforts and invaluable contributions in generating global interest in the Philippines,” Romualdez said.

“From highlighting our young and dynamic workforce to presenting our pro-business policies such as the CREATE MORE (Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy) law and the Maharlika Investment Fund, we have successfully demonstrated that the Philippines is a viable and vibrant investment destination,” he added.

Key engagements

Romualdez participated in high-level discussions and engaged with prominent global business leaders and officials, including his participation as a panelist in the Stakeholder Dialogue titled “Navigating Asia’s Hotspots,” where he emphasized the country’s balanced geopolitical approach and commitment to economic stability.

“We presented a clear narrative of the Philippines as a reliable partner in the Indo-Pacific region, not only geopolitically but also economically. Our focus is on fostering peace, stability and cooperation, which are vital for sustained growth,” he said.

The country’s delegation also hosted the Philippine Breakfast Interaction, which convened close to 50 international public and private sector leaders for a briefing on the Philippine economy and its potential as the next big investment destination.

Among the notable guests during the event were Marcus Wallenberg, chair of Skandinaviska Enskilda Banken; Philippe Amon, chair and CEO of SICPA SA; Catarina Amon, CEO and founder of Classeek; Anthony Tan, CEO and co-Founder of Grab; John Riady, Group CEO of Lippo Indonesia; Tony Fernandes, CEO of AirAsia; and Calvin Choi, CEO of AMTD.

Also present were Jay Collins, vice chair of Citi; Helena Lersch, vice president of Public Policy of Tiktok; Amit Kalyani, vice chairman and joint managing director of Kalyani Strategic Systems Limited; and Albert Chang, managing partner of Southeast Asia, McKinsey & Co., among others.

During the discussions, the Philippine delegation showcased its robust domestic economy driven by e-commerce, making the country the fastest-growing digital economy in Southeast Asia in 2024.

Investment-friendly Reforms

The Philippine delegation likewise highlighted legislative reforms under the Marcos administration as concrete manifestations of the readiness of the country to listen to investors’ concerns.

In particular, they cited the CREATE MORE law, signed by President Marcos in November last year.

The CREATE MORE law is meant to accelerate investment momentum by offering enhanced tax incentives, streamlining the investment approval process, simplifying VAT rules, and providing targeted incentives for strategic investments.

He said the WEF once again placed the country on global investors’ radar, giving opportunities to the Philippines which is ready to turn them into concrete investments that will accelerate progress. (PNA)

Nueva Ecija home to world's largest solar battery storage facility

BBM breaks ground for world's largest solar, battery storage facility

Catherine S. Valente

Manila Times

21 November 2024

MANILA, Philippines — President Ferdinand Marcos Jr. on Thursday led the groundbreaking of the Meralco Terra (MTerra) Solar Project, considered as the largest integrated solar and battery storage facility in the world.

In his speech in Gapan City, Nueva Ecija, Marcos said the landmark project would "put our country on the map as a leader in renewable energy."

"With an investment of over P200 billion, this demonstrates confidence in the stakeholders in our nation's potential and our commitment to securing a stable, steady, reliable, and sustainable power supply," Marcos said.

The President highlighted the importance of the solar project expected to power over two million households and reduce carbon emissions significantly once fully operationalized in three years.

He said it would also address the growing demand for electricity and the Philippines' urgent need to transition to sustainable energy.

"Once fully operational by 2027, this facility will deliver 3,500 megawatts peak of solar power to the Luzon grid, with 4,500 megawatt-hour battery energy storage," Marcos said.

"This project will energize over 2 million households and reduce carbon emissions by more than 4.3 million metric tons annually. To put that into perspective, it is equivalent to removing 3 million gasoline-powered cars from our roads—decisive action towards helping address global warming and climate change," he added.

The project spans 3,500 hectares across Nueva Ecija and Bulacan. Initially, it will be connected to the existing 500-kiloVolt (kV) Nagsaag-San Jose Transmission Line and later linked to the upcoming 500-kV Nagsaag-Marilao Transmission Line.

Singapore president state visit to the Philippines

Singapore president arrives in Philippines for three-day state visit

Cristina Chi - Philstar.com
August 15, 2024

MANILA, Philippines — President Ferdinand Marcos Jr. will meet Singaporean president Tharman Shanmugaratnam today to mark the start of the foreign leader's three-day visit to the Philippines.

President Ferdinand R. Marcos Jr. meets with Singaporean President Tharman Shanmugaratnam to strengthen the bilateral relationship between the Philippines and Singapore, May 31, 2022.

Marcos and First Lady Liza Araneta-Marcos will welcome the Singaporean leader and his spouse, Jane Ittogi Shanmugaratnam, according to the Presidential Communications Office (PCO).

Marcos and Tharman are expected to discuss bilateral relations between the two Southeast Asian countries and witness the signing of a memorandum of understanding on the recruitment of Filipino healthcare workers and carbon credits.

During his visit, Tharman will be briefed by Environment Secretary Maria Antonia Yulo-Loyzaga, on the Philippines’ plans for sustainability of water and other natural assets, and possible areas for bilateral cooperation, according to Singapore's Ministry of Foreign Affairs. 

"The two countries will continue to engage in cooperation in both bilateral and multilateral arenas, particularly in the fields of energy and healthcare, among others," the PCO said.

Tharman is the first Singaporean head of state to visit the Philippines in an official capacity since Halimah Yacob in 2019.

The visit comes after Marcos' trip to Singapore in May, where he extended an invitation to Tharman and Prime Minister Lawrence Wong to visit the Philippines. 

Diplomatic relations between the Philippines and Singapore were formally established on May 16, 1969. The two countries celebrated their 55th year of diplomatic ties this year.

An estimated 200,000 Filipinos live and work in Singapore, an estimated 60% of which are professionals and skilled workers, while the rest are employed as household service workers.

President Marcos SONA 2024

What Marcos said in his third SONA, from A-Z

Cristina Chi 
Philstar.com
July 23, 2024 

MANILA, Philippines — President Ferdinand Marcos Jr.’s third State of the Nation Address began with a by-the-book reinforcement of his technocratic image as an economic manager, then ended with his rousing pronouncements calling to protect the West Philippine Sea and ban all Philippine offshore gaming operators (POGOs).

Met with swelling applause, Marcos’ third SONA was expectedly free of personal digs to his former UniTeam allies and peppered with minutiae details of the economic, education, health and social programs to come.

Here, we break down the one-hour speech into easily digestible topics from A to Z.

Agriculture 

Like last year, Marcos opened his speech with plans to galvanize the agricultural sector, starting with the provision of more seeds, fertilizers, livestock, boats and technical and financial assistance to farmers and fisherfolk.

The president said “the hard lesson” of the past year is that data showing the Philippines’ fair standing in the region “means nothing to a Filipino, who is confronted by the price of rice at P45 to 65 pesos kilo.”

The president served concurrently as Department of Agriculture secretary for 17 months before picking fishing tycoon and top campaign donor Francisco Laurel Jr. to replace him. 

Business 

Marcos noted a rise in the number of new businesses and corporate registrations, including foreign firms, driven by expedited processes for registration and approval. 

To bolster economic growth, the president said his administration is pushing for an investment-friendly environment through capital market reforms and the implementation of “green lanes,” which are streamlined processes designed to reduce bureaucratic hurdles for businesses.  

Climate change 

Known to speak in broad strokes about the climate crisis, President Marcos this time bannered the country’s proactive stance on global climate responsibility, including being the host country of the board of the Loss and Damage Fund, which seeks to help poor nations cope with costly climate disasters

The president also spoke of ongoing efforts to enhance disaster preparedness and promote renewable energy sources to mitigate the impact of climate change.

Digitalization 

Marcos also claimed the government has made leaps and bounds in digitalization, noting that the number of common towers, or shared infrastructure that allow different telecommunications providers to have co-sharing arrangements, has more than tripled due to streamlined permitting processes.

E-visa

Marcos also highlighted improvements in air transport and tourism through the e-travel system, which provides a digital single data collection platform for passengers arriving in and departing from the Philippines.

The president said e-gates (electronic gates) will become “standard fixtures” in airports, while the “e-visa” is next on his government’s digital transformation agenda.

Free Wi-Fi

Marcos mentions another statistic: nearly ten million unique user devices have reportedly benefited from the government’s free Wi-Fi program, which provides internet access in over thirteen thousand locations across the Philippines, including schools and remote areas. 

Marcos also announced the completion of phase 1 of the National Fiber Backbone, with phases 2 and 3 underway and expected to be completed by 2026, aimed at significantly boosting the country's internet bandwidth capacity.

‘Generic’ medicine 

Marcos announced that PhilHealth has significantly expanded its coverage of generic medicines for outpatient benefits, increasing the number of included generic drugs from 21 to 53. This expansion includes new medications for hypertension, nerve pain, and epileptic seizures.

Hospital decongestion 

Marcos also bannered two new specialty hospitals that aims to decongest public hospitals and galvanize the "nation's fight against cancer." These are the UP-PGH Cancer Center, the first Public Private Partnership project to be approved under Marcos, and the the Philippine Cancer Center of the Department of Health, which broke ground in March.

Inflation 

In relation to his plans for agriculture, Marcos listed several measures to reduce food prices and ultimately tame inflation, which at least 74% of Filipinos said the government is failing to manage in a Pulse Asia survey last week.

Due to “illegal price manipulations and smuggling,” Marcos said the government has temporarily set price ceilings on rice and reduced tariffs on rice, corn, and pork until the end of the year and assured the sector these were only “short-term solutions.”

Jobs 

In describing his plan to create more jobs in the country, Marcos touted the estimated 202,000 jobs expected to be created from the investment pledges he scored while on his numerous trips abroad.

Another statistic: Marcos cited the Philippines’ increased employment rate 95.9% and decreased underemployment from 11.7% in May of 2023 to 9.9%.

‘Kadiwa’ expansion 

Marcos said his pet KADIWA program was instrumental in helping people deal with high food prices. 

He announced plans to expand the KADIWA centers with local government support, aiming to make them permanent and well-distributed across the country.

Law and order 

After recently vetoing the proposed Philippine National Police Reform Act due to the absence of strong accountability standards for cops, Marcos reiterated the need for law enforcers to build public trust to maintain law and order.

“We have noted an overall decrease in crime rate and an improvement in crime-solution efficiency. But this is not enough. Our law enforcers need to earn the trust of our people,” Marcos said.

Mindanao-Visayas interconnection 

Marcos also mentioned the 450-megawatt Mindanao-Visayas Interconnection Project of the National Grid Corp. of the Philippines, which was ceremonially switched on in January, as “a defining moment not only for the power sector but for the entire country.”

With the project, the president said the government has connected the power grids of all three major island groups of Luzon, Visayas and Mindanao. 

National learning recovery 

Aware of the Philippines' flagging performance in international assessments, Marcos turned his focus on improving the conditions of teachers, who he described as the "core of our national learning recovery."

Marcos hailed recent moves to provide teachers with an annual chalk allowance in the “Kabalikat sa Pagtuturo” Act and the provision of a personal accident insurance for teachers through the Government Service Insurance System. 

"Our national learning recovery program must proceed without the slightest disruption, especially in basic education," Marcos said.

Overseas Filipino workers 

After expressing the usual gratitude to overseas Filipino workers for their remittances and their impact on the economy, Marcos said his government has provided "special facilities and services" for them: the OFW lounge at the Ninoy Aquino International Airport and the Seafarer's Hub in Manila.

POGO ban 

Triggering a standing ovation from administration supporters and critics alike, Marcos announced a total ban on all POGOs across the country and ordered the Philippine Amusement and Gaming Corp. (PAGCOR) to wind down their operations by the end of the year. 

Marcos also ordered the Department of Labor and Employment to look for new jobs for Filipinos who will be affected by the ban.

In the past months, Sen. Sherwin Gatchalian and Sen. Risa Hontiveros have both uncovered a string of POGO-related crimes in the country that they say can also be traced back to the public officials who benefited from them, such as suspended Bamban Mayor Alice Guo, whose birth certificate and other claims of citizenship have been tagged as inauthentic.

Quality of life 

Marcos also hailed the Pantawid Pamilyang Pilipino Program’s success in “breaking the cycle of poverty” in the Philippines with around 420,000 families who have graduated from the program.   

The president also seeks to expand the 4Ps program to benefit pregnant women by capitalizing on the rare window for significantly improving children’s development and quality of life — from mother’s pregnancy to age 2.

‘Railway renaissance’ 

As part of his ambitious Build Better More infrastructure program, Marcos described an ongoing "railway renaissance" in the country of building more railways to improve public transportation.

He cited as an example the Metro Manila Subway Project, where tunneling works have reached depths equivalent to three to six floors. He also noted that other railway projects, including MRT-7 and the North-South Commuter Railway, are making steady progress.

Space technology 

Marcos also praised the achievements of Filipino space scientists and engineers for reaching new heights in the pioneering field. Since the nation’s foray into space technology, the country’s satellites in space have generated more than 51,000 maps, images and space-borne data, the president said.

Marcos noted that 16 Filipino space engineers are currently in the United Kingdom working on the MULA satellite, which, once completed, will be the country’s largest Earth observation satellite to date.

Tech-voc training 

Besides listing his usual expectations for the government’s biggest education agency — the Department of Education — Marcos this time expressed hopes for the much smaller Technical Education And Skills Development Authority to step up its programs to produce more employable graduates.

“Statistics do not lie. Eight out of ten graduates of TVET ultimately land decent jobs. So with its high employability rate, TVET will definitely be instrumental in capacitating our people, and in maintaining our employment rate at consistently high levels,” the president said.

University rankings 

The number of Philippine universities that make it to world rankings appears to be a continuing marker of success for the Marcos administration.

Marcos said this year, 87 higher education institutions (HEIs) have now made it into various world university rankings, 51 of which are public universities or colleges.

Vaccination

As part of the administration's recalibrated approach towards prevention, Marcos said that they would prioritize vaccinations.

The government will continue vaccination efforts, especially for infants and children, particularly in Region 6 and BARMM, where less than half have been vaccinated.

Water security

Marcos laid down his strategy for ensuring water security: by completing irrigation dams to supplement other bulk water projects, especially in underserved areas.

Marcos cited the Jalaur River Multipurpose Project in Iloilo as an example of his water security programs, which is expected to irrigate nearly 32,000 hectares and also help in flood control, electricity generation, and tourism.  

The damage wrought by El Niño to farmers has led the government to shell out over P9 billion in crop insurance payments and explore early adoption of modern low-water-use farming technologies, the president added.

X-periental tourism 

To boost the Philippines’ tourism standing in the region, Marcos is eyeing to focus on what the country can offer in terms of experiential tourism, which seeks to provide travelers with the opportunity to immerse themselves in the destination country’s culture and history.

The president’s vision for the tourism industry is in line with the Department of Tourism’s findings last year when its market survey showed that post-pandemic, travelers would rather spend their money on experiences and not on material things.

Youth creativity 

Marcos also wants the nation’s youth to not just be literate but also capable of creative and innovative thought. 

Ideally, the president said the education system must also “consciously develop them into problem-solvers, and into critical thinkers — hungry for success [and] ready for the future.”

According to the results of a new Programme for International Student Assessment (PISA) global test released in June, the Philippines ranks in the bottom four among 64 economies in terms of creative thinking.

‘Zones’

The proposed Maritime Zones Act — a priority measure that a bicameral conference committee has already approved — was spotlighted as one of two pending legislations needed for Filipinos to continue their “intergenerational mandate” of defending the country’s sovereign rights West Philippine Sea. 

The measure defines the maritime zones under the country’s jurisdiction to fend off entities that seek to challenge the 2016 ruling, which dismissed China’s claim of historic rights over almost the entire South China Sea, including parts of the West Philippine Sea. 

Philippines and Japan sign defense pact

Japan and Philippines ink key military pact in defense ties upgrade

The Japan Times
By Gabriel Dominguez and Jesse Johnson
Staff Writers
08 July 2024

Japan and the Philippines on Monday signed a highly anticipated visiting-forces agreement, paving the way for greater bilateral and multilateral defense cooperation amid escalating tensions between the two partners and Beijing in the disputed East and South China Seas.

Ground Self-Defense Force personnel take part in a joint amphibious landing exercise with Philippine and U.S. troops in San Antonio, in the Philippines' Zambales province, in October 2018. | AFP-JIJI

The two U.S. allies signed the Reciprocal Access Agreement (RAA) shortly after Foreign Minister Yoko Kamikawa and Defense Minister Minoru Kihara met with Philippine President Ferdinand Marcos Jr.

The agreement, which still needs parliamentary approval, will enable larger and more complex joint military exercises and grant the Self-Defense Forces greater access to Philippine bases, potentially even enabling rotational deployments.

The pact stipulates jurisdiction in the event a service member commits a crime or causes an accident in the other’s country. It also eases restrictions on the transportation of weapons and supplies for joint training and disaster relief operations.

The agreement comes after months of negotiations, and is Japan’s first with a Southeast Asian country.

Kamikawa and Kihara, who were in Manila for a "two-plus-two" meeting between the countries' defense and foreign ministers, lauded the agreement.

“As the security environment surrounding us becomes more and more severe, it is extremely important to highlight cooperation and coordination with our allies and with like-minded countries in order to maintain peace and stability in the Indo-Pacific region,” Kihara told a joint news conference.

“The RAA signed today is groundbreaking, and I hope that cooperative exchanges between the SDF and the Philippines will become even more active,” he added.

While Japanese forces have regularly visited the Philippines in recent years, they have often “piggybacked on U.S.-Philippine training activities,” said John Bradford, a military expert and former country director for Japan at the Office of the U.S. Defense Secretary.

“But with the latest pact, we can now expect more bilateral activities,” he said, noting that the RAA will not only result in more cross-training but, more importantly, also in “streamlined procedures that will make such activities less costly and reduce the lead time needed to go from proposal to deployment.”

Foreign Minister Yoko Kamikawa and Philippine Defense Minister Gilberto Teodoro shake hands after signing a Reciprocal Access Agreement at the Malacanang Palace in Manila on Monday. The key defense pact will allow the deployment of troops on each other's territory, as they boost ties in the face of China's growing assertiveness. | POOL / VIA AFP-JIJI

Though Kamikawa said Monday that closer Japan-Philippine security ties were “not aimed at a specific country,” China’s “aggressive moves” near disputed islands and features — in particular around the Philippine outpost on Second Thomas Shoal in the South China Sea and near the Japanese-controlled Senkaku Islands in the East China Sea — have provided “a motivating cause for cooperation,” said Jeffrey Hornung, a senior political scientist and Japan lead at the Rand Corp. think tank.

The pact will not only make it much easier and faster for the SDF to be deployed to the Philippines for drills, but also in times of crises, including natural disasters, while helping improve bilateral operational readiness and interoperability.

At the same time, the RAA will strengthen trilateral cooperation with U.S. and possibly Australian forces, both of which have signed similar pacts with the Philippines.

The visiting-forces agreement will be Japan's fourth overall, following its 1960 Status of Forces Agreement with the U.S., and its RAAs with Australia in 2022 and the U.K. last year.

Tokyo also recently launched negotiations for a similar pact with France, reflecting the speed at which Japan is deepening and expanding its network of international security partners — particularly with other U.S. treaty allies.

Hornung said the speed at which Tokyo’s latest RAA negotiations progressed was “remarkable,” especially given that Manila only announced its intent to sign the deal last November.

“The negotiations Japan had with Australia and the U.K. for those RAAs took years,” he said.

Concerns over the fate of democratic Taiwan, which China claims as a renegade province, were believed to have played an outsize role in the need for a quick agreement.

The Philippines’ proximity to both Taiwan and key sea lanes in the South China Sea makes it an attractive staging point for the U.S. and its allies that could boost their ability to respond to regional crises.

This has made reinforcing defense relations with Manila a critical element in both Tokyo and Washington’s calculus for deterring and countering Beijing.

According to Masashi Murano, a Japan expert at the U.S.-based Hudson Institute think tank, the RAA could also enable SDF surface-to-ship missile units to drill with powerful U.S. offensive weapons such as HIMARS and new midrange missile systems on Luzon Island, although Japanese political concerns could prevent such a move.

It would also allow the Ground Self-Defense Force’s Amphibious Rapid Deployment Brigade and U.S. Marines or special forces to train with small, ground-launched loitering munitions and drones capable of electronic attacks.

“These could create a denial zone from the northern Philippines to southern Taiwan — which would be part of what (U.S. Indo-Pacific Command chief) Adm. Samuel Paparo calls a ‘hellscape’ that would put at risk Chinese naval vessels attempting to pass through the Bashi Channel,” Murano said.

The U.S. — which last year gained access to four more military sites in the Philippines, in addition to five that were previously agreed to — has been helping the Philippines bolster its defense capabilities.

Japan has also expanded security ties with its mutual U.S. ally, agreeing in May to provide a $415 million loan for additional coast guard ships, as well as making Manila the first beneficiary of a military aid program that provides defense equipment for free to like-minded nations.

U.S. President Joe Biden (center) with Philippine President Ferdinand Marcos Jr. (left) and Prime Minister Fumio Kishida at their trilateral summit at the White House in Washington in April | REUTERS

While Japan and the U.S. have been separately strengthening ties with the Philippines, Washington has recently also sought to bring the countries closer together to deepen trilateral defense cooperation and build up what it calls “collective capacity.”

From a global perspective, Bradford said, increased security cooperation between Tokyo and Manila will help fortify a "maritime wall" along what is known as the first island chain, which links the Japanese islands, Taiwan and the Philippines.

But critics say that beefing up deterrence without taking into account potential responses — and with only minimal diplomatic efforts made to address worsening relations — runs the risk of escalating confrontation. This is especially the case as maritime disputes between the Philippines and China threaten to drag the U.S., and possibly even Japan and Australia, into a larger crisis.

Beijing has repeatedly criticized such U.S.-led defense constructs as attempts to militarily encircle China.

Meanwhile, as Japan looks to balance its ties with China, the ostensibly pacifist country is also likely to face high political and legal hurdles for rotational SDF deployments to the Philippines, experts say — though these hurdles are slowly being lowered.

“Given that the U.S. Army's Mid-Range Capability Typhon missile system, deployed in April this year for the purpose of joint U.S.-Philippines exercises, is still being deployed in the Philippines, the boundary between deployment for the purpose of exercises and rotational deployments is becoming ambiguous,” Murano said.

Ultimately, while the symbolism involved in the pact sends a powerful message to China, it is not expected to dramatically change the way Tokyo cooperates with Manila, which has limits to how far it will go in confronting Beijing.

“I think it useful to see this as yet another step that brings (Japan and the Philippines) closer together,” said Naoko Aoki, a political scientist with the Rand Corp.

“As the two countries increase cooperation, I think it is important for them to discuss what they are prepared to do during contingencies,” she said.

“While an answer to this may not be clear immediately, I think it is important for Japan and the Philippines to continue their strategic dialogue to gain a better understanding about each other’s thinking.”