- Not a day goes by in the Philippines without reports about new friction and arms sales. Elevated military spending is now undermining economic development while fostering economic uncertainty and political volatility.
LAST week, Philippine and US Marines demonstrated “lethal firepower in two separate live fire exercises” that the Philippine Marine Corps portrayed as a “defense partnership.” It went hand in hand with high-profile, high-cost military deals.
These follow Manila’s flirting with the US Army Typhon missile systems. The deployment is part of the US military’s strategic repositioning in the Pacific and a moneymaker to the world’s largest weapons manufacturer, Lockheed Martin. In April, the US also approved the potential sale of 20 F-16 fighter jets to the Philippines in a $5.6 billion deal.
The Marcos Jr. government has also been busy negotiating a variety of military access deals not just with the US, but also with Japan and European powers.
To defense contractors, Manila is now a prime weapons theater in Southeast Asia.
Deals heralding the showdown
In parallel, the Marcos Jr. government, which is still licking its wounds after its weak performance in the recent midterm elections, signed a $700-million contract with Korea Aerospace Industries (KAI) to acquire an additional batch of 12 FA-50PH light combat aircraft.
Days before, the government inked a $460-million deal with French shipbuilder OCEA for 40 fast patrol boats for the Philippine Coast Guard. In mid-2020, on the eve of the proxy war in Ukraine, the French OCEA also signed a $186-million deal with Ukraine to provide 20 fast patrol boats. It’s great business for France, which is today the world’s second-largest arms exporter.
Manila had already purchased four similar FPB-72 gunboats in 2018, quickly renamed as Boracay-class patrol vessels. In the past few years, these have played a key role in the Philippines-China incidents in the South China Sea, thanks to Project Myoushu, a derivative of the US Naval Institute’s Maritime Counterinsurgency Project, and an initiative of a Stanford University think-tank.
Ever since President Ferdinand Marcos Jr. agreed to a number of new rotating military bases for the US in the Philippines, Manila has become a model of militarization in the region, as verified by military spending and arms transfers.
The ASEAN community features 10 nations. Today, only three of them are included in the Top 40 list of military spenders: Singapore, Indonesia, and the Philippines. Unlike the first two that have fallen in rank, the Philippines is on the rise and made the list for the first time in 2025. It is right behind Iraq.
The Philippines is investing increasingly in military spending. On a per capita basis, it spends more on arms than Indonesia, which has a population of over 280 million, as opposed to 115 million Filipinos.
Furthermore, the Philippines’ increase in military spending is on average twice as fast as Singapore’s and Indonesia’s. In the tiny city-state, the share of military spending of GDP is 2.8 percent; and in Indonesia, 0.8 percent. But in the Philippines, it is 1.3 percent — in relative terms, more than 50 percentage points higher than Indonesia.
In the Duterte era, the Philippines was an aspiring BRIC-like economy. Today, it is an assertive military spender that is cannibalizing its economic future.
PH as a major global arms importer
The Philippines is one of the world’s largest importers of arms. In a gross misallocation of resources, Manila is boosting its arms imports faster than any other major ASEAN arms importer.
In the global top 40 list of the world’s largest arms importers, there are just four ASEAN countries: Singapore, the Philippines, Indonesia, and Thailand. Although the tiny city-state has the largest share of global arms imports, the Philippines is second, ahead of both Indonesia and Thailand.
In the past half decade, these other ASEAN states have cut their arms imports by 20 percent (Singapore) to almost 50 percent (Indonesia, Thailand). They have tried to prepare for the economic headwinds that now drastically penalize global economic prospects. Unlike them, the Philippines has dramatically increased its share of global arms imports by more than 50 percentage points.
