The Philippines will continue increasing defence spending as it seeks private sector’s support in safeguarding the nation’s claims in the disputed South China Sea.
Defence Secretary Gilberto Teodoro said he has been pushing for his department’s budget to rise to more than 1% of economic output, excluding military pensions.
The Philippines is trying to upgrade its defence capabilities and catch up with its neighbours at a time when its military assets are sustaining damage from frequent clashes with Beijing in contested waters. The defence budget was increased to 278.1 billion pesos ($4.8 billion) in 2024.
The defence chief is also asking the private sector to structure sale of debt instruments to raise funds that help support the Southeast Asian nation’s claims in the South China Sea.
“It’s up to them to see what the appetite of the market is at any particular time,” he told reporters at the sidelines of a business forum Wednesday.
The target buyers are investors looking to gain from a potential improvement in the country’s credit rating and other defence industry ventures, he said, adding that “there are a lot of creative ways” to raise funds.
“The important thing is to ease the fiscal position of the government and not sacrifice modernisation,” Teodoro said.
War games in Australia
The Philippines Air Force arrived in northern Australia on Wednesday on its first overseas deployment in six decades for combat practice alongside U.S. and Australian troops, amid a rise in tensions with China in the South China Sea.
Four Philippine FA-50 fighter jets and some 162 personnel are taking part in the Pitch Black war games over Australia's largely unpopulated Northern Territory, involving 20 countries and 140 aircraft.
"This is the first time they have taken their combat aircraft abroad since 1963 so it is a huge honour for Australia to be chosen as the first location for the deployment," Royal Australian Air Force (RAAF) Air Commodore Pete Robinson told Reuters.
The Northern Territory provides a "huge amount of airspace" to boost capabilities from dog fighting to using radar and missile systems to engage adversaries beyond visual range, he added.
The Philippines fighter jets would work with other air forces "to solve some complex problems against a simulated adversary and ground threats", he said. The U.S. F-22 stealth fighter and Australia's F-35A and F-18 are among the combat aircraft taking part.
"Bringing that package together will provide an impressive outcome that is stronger than its parts," Robinson said.
Australian Strategic Policy Institute senior analyst Euan Graham said although the Philippines has a mutual defence treaty with the United States, it would look to its own air force and navy as the first line of defence.
"Within the context of the South China Sea and the Philippines feeling an external sense of threat very strongly now from China, Manila has been trying to improve its own defence capability," Graham said.
"The big change is they lost a lot of their capability and now they are regaining it," he added.
The Philippines is seeking to modernise its military's outdated hardware that includes warships from World War Two and helicopters used by the United States in the Vietnam War.
Philippine Armed Forces Chief Romeo Brawner said last week the Philippines wants to buy longer-range, multi-role fighters although it has not made a decision on which aircraft it will buy for its modernisation program.
Recent deals with Australia and Japan to allow militaries to visit and move through each other's territory show the Philippines is seeking more regional defence relationships, said Graham.
In April, Australia, Japan, the US and the Philippines held a navy cooperation exercise in the South China Sea.
"Building interoperability with our regional partners... allows us to maximise the strengths of each of the respective air forces, to bring together a group that has a shared value for sustaining peace and stability across the region," said Air Commodore Robinson.
"To make sure if the worst happens, we are ready to respond."