The Philippines has ended its flirtation with China – so what next for the country’s navy?

As the second largest archipelagic state in the world – behind Indonesia – and situated at the edge of the Pacific but with territorial waters at the crossroads of international maritime trade routes, the Philippines has always held a strategic position in Southeast Asia.

Yet for decades the US was the only Western country showing interest and building ties with the Philippines and its navy, with several bases in the country until the non-renewal of the lease in 1991.

Additionally, despite its 36,289km of coastline and its 2,263,816 sq km of EEZ, both of which require considerable maritime capabilities to patrol and secure, Manila’s investment in its navy has remained surprisingly low for decades.

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In fact, the Philippine Navy (PN) today features a relatively high number of ships that were transferred essentially by the USN in the 1990s and early 2000s. A few have also been donated by, or purchased from, neighbouring countries such as the Republic of Korea (RoK) and Australia.

Over the past decade, however, as regional tensions have been intensifying – such as illegal, unreported and unregulated fishing, competing territorial claims, incursions by other states – international attention has turned back to the Philippines.

How has the Philippines' naval outlook shifted since 2022's change of government? 

This has been even more apparent in the past year, as the election of Ferdinand ‘Bongbong’ Marcos Jr (BBM) in June 2022 prompted a subtle but clear shift in the country’s regional outlook.

While during his campaign BBM reasserted his desire to continue building relations with China – a key tenet of former president Rodrigo Duterte’s regional strategy – his actions over the past year have gone in a different direction.

They have shown that he is clearly seeking to retain strategic independence from Beijing in order to build and/or strengthen regional and international alliances instead.

Relations with the US, which had been a little strained under Duterte, are now being rebuilt again. Beyond continued joint maritime exercises and drills between the two countries’ navies – the latest one in September – in April the Philippine government granted the US access to four bases – three on the main island of Luzon, close to Taiwan, and one in the southern territory of Palawan, near to the South China Sea.

Above: The French Navy’s FREMM frigate Lorraine recently paid a visit to Manila, and there are clear signs of aspirations towards greater strategic and industrial collaboration by Paris. (Photo: French Embassy in Manila)

Over in Europe, France is looking to build stronger relationships with the strategic archipelago. In June this year, the French Navy FREMM air defence frigate Lorraine made a week-long port visit to Manila, part of a deployment to support a free and open Indo-Pacific, and a strong signal of Paris’s intentions to play an important role in the region’s security.

It also comes five months after Germany – which is also seeking to increase its support to the region – and France jointly announced that they were ready for maritime cooperation with the Philippines. Displaying similar intentions, the Italian Navy made a four-day port call in Manila in July.

At a regional level, Manila is also becoming a stronger partner to a number of nations. In fact, despite an ongoing dispute over the Kalayaan island group, the Philippines and Malaysia, together with Indonesia, are considering expanding Sulu Sea trilateral patrols. These aim to tackle transnational organised crime and terrorist threats.

Finally, following the 2023 Shangri-La Dialogue, there have been rumours of a ‘Quad 2’ group featuring the US, Australia, Japan and the Philippines, with the latter having also increased its cooperation with the PN – mainly through joint exercises.

How much will the Philippines spend on its navy?

Such renewed regional and international attention towards the archipelagic state has, understandably, had a significant impact on the country’s attention to its own navy.

In fact, after an all-time low defence budget representing a mere 0.8% of GDP in 2018, allocations have seen an important uptick. In 2021, the budget had reached 1% of GDP, according to World Bank data, and in 2023 proposed defence spending (US$4.28 billion) represented an 8% increase from 2022 ($4 billion), with 14.4% to be allocated to the navy. This was on par with the air force, whereas the army will receive 46% of the budget.

Part of this increase will go toward a number of new, key programmes such as the Philippines very first submarine, a programme that is also creating the opportunity to strengthen regional and international industrial ties. Both France (Naval Group, which opened an office in the Philippines in 2020) and the RoK (DSME) have been shortlisted for the programme.

At operational level, since 2019 France’s DCI group has been providing the Philippine navy with assistance on the deployment of submarines and organising an SSK force.

On 3 May, the US also announced its intention to transfer four patrol boats to the PN (two Island and two Protector class), continuing the long tradition of transfers between the two nations.

Above: After years of shoestring budgets, the PN is now shopping for new capabilities, including doubling the size of its LPD fleet. (Photo: Philippine Navy)

Finally, the relationship between the Philippines and Indonesia is also being strengthened at industrial level, with the Philippine Navy signing for the acquisition of two more Landing Platform Docks (LPD) – it already operates two.

Ultimately, after decades of being a quasi-outlier, the Philippines – and by extension the PN – is finally regaining its rightful place in the security framework of the Indo-Pacific. BBM’s pivot back toward Washington – and more specifically away from China – has presented regional and Western partners with an opportunity to strengthen operational and industrial ties, which in turn is providing the basis for a significant fleet renewal.