Philippines

The Defence Budget of the country was increased twice between 2019-2021. The first increase was in 2019, when the Defence Budget of the Philippines was increased by 22.1% compared to 2018 and reached US$3.47 Billion (in current US$ prices). The second increase was recorded in 2020 by 7.52% compared to 2019 and the Defence Budget reached US$3.73 Billion (in current US$ prices).

For 2021 the Government has allocated US$4.3 Billion (in current US$ prices) increased by 14% compared to the Defence Budget of 2020. According to Jane’s 15.8% of the 2021 Defence Budget will be allocated for military procurement under the Revised Armed Forces of the Philippines Modernization Program (RAFPMP) indicating an additional increase. The previous years this program had been receiving approximately USD500 million a year.

Defence and Security Policy

Although the Armed Forces of the Republic of the Philippines were established on December 21, 1935, and the country became independent on the 4th of July 1946, the first National Security Policy (NSP) was issued in 2017. The NSP outlined the overall national security objectives of the Government. A year later in 2018 the National Security Strategy (NSS) was issued. The NSS categorized the Philippines national interests into “core”, “important” and “other”.

These interests were then harmonized into national security goals from which broad strategic courses of action were identified. The same year 2018, on the 31st of October, the Philippine Department of National Defence (PDND) presented a copy of the country’s National Defence Strategy (NDS).

This was the first ever NDS in the history of the Philippines and became publicly available in August 2019. The horizon of the NDS is from 2018 till 2022, when the term of President’s Duterte expires.   

The NDS maps the planning prioritization and resourcing process of the PDND in line with the identified priorities and outcomes of the NSS. The NDS identified six of the twelve national security goals which are most relevant to the PDND mandate.

Among others, these national security goals include: a) safeguard and preserve national sovereignty and territorial integrity, b) ensure maritime and airspace security and c) strengthen international relations.

The NDS identified two categories of defence missions: external and internal. The external defence missions are: a) Maritime and Air Defence Mission, b) Cyber Security Mission and c) Security Cooperation and Engagement Mission.

The NDS of 2018 will also be used as the basis for the creation of the National Military Strategy (NMS) by the Armed Forces of the Philippines to ensure coherence and alignment of important strategies for a more effective and collective response to national security threats.

The NDS has three major implications for the defence and security relations of the Philippines in the Asia Pacific region. The first implication is related to the broader purview of the U.S-China relations and geopolitical competition.

Like the NSP the NSS, and the NDS, underscored that the overall strategic backdrop and geopolitical landscape of the Asian-Pacific lies on the U.S-China rivalry, which proves to be a vital consideration for the strategic decisions of the Philippines.

The South China Sea is crucial to the security and economy of the region, The NDS underscored that sea lanes of communication must be kept open and that freedom of navigation and overflight the SCS must be ensured.

According to Manila the massive construction of artificial islands in the Philippines maritime areas in the South China Sea which may be used as military bases, is regarded by the Government in Manila as a grave threat to the Philippines national security. 

For Manila, the foremost security challenge to the Philippine sovereignty and territorial integrity, is the dispute in the West Philippine Sea.  

Manila claims that Chinese expansion in that region is driven by “food and energy source demands” and renewed stirring of nationalism. The NDS of the Philippines, regards also other territorial and maritime disputes in the region, particularly the Senkakou/Diaoyu islands in the East China Sea and the issue of Taiwan.

Second, the NDS reaffirmed the Philippines alliance and security partnerships as well as ASEAN, centrality in the multilateral architecture. A key pillar of the NDS of the Philippines the Manila’s security relations with other countries.

It also notices that the U.S remains as the only treaty ally and that the stabilizing U.S presence in the region, can be further expected to persist as it is strengthened by its continued defence engagements forged with the nations of Asia-Pacific including Japan, South Korea, New Zealand, Australia and the Philippines.

Furthermore, the NDS reaffirmed the importance of Manila’s strategic partnership with Japan, and Vietnam, the comprehensive partnership with Australia, as well as security ties with other countries in the region, such as South Korea and Southeast Asian states.

The NDS finally underscored the importance of ASEAN for the Philippines national security.

Third, the strategy document (NDS) also suggested some efforts to strike a delicate balance in line with apparent shifts in the country’s foreign policy. The NDS identified China and Russia as emerging security partners. China inclusion in this category is of particular interest because the artificial islands constructed by China are according to the NDS grave threats to the country’s national security.   

Although after his election, President Duterte initiated a new foreign policy doctrine pretending that the US-Philippines alliance is not a factor for his country’s defence concept and seeked to approach China instead, the long-lasting dispute of the two countries in the South China Sea, made him to realize that China is not a friend and that the Philippines needs its long-standing security ally the United States. 

Having decided on February 11, 2020 to terminate the US-Philippines Visiting Forces Agreement (VFA) which was initiated in 1998 and allows among other the U.S troops to deploy to the Philippines, in order to address potential contingencies including against China, Duterte alter his policy and reactivated the VFA in July 2021.

This dramatic change of policy was due to “hostile acts” that China did in the South China Sea and more specifically at Thitu island (at the region of the Spratly islands) starting in early 2019 through early 2020. In addition to that in April 2020 China declared the establishment of administrative control over the disputed islands.

That same month, China redeployed a geological survey vessel with coast guard escorts into Vietnam’s Exclusive Economic Zone (EEZ) and did the same against Malaysia in May 2020. In January 2021 China passed a new Coast Guard law that authorized its ships to fire on rival ships.

Two months later, China and the Philippines engaged to a months long tension in the Spratly islands, which included the chasing of a Philippine vessel with a news crew onboard by a Chinese Navy ship.    

These actions made Manilla to re-examine its policy towards China and convinced Dutarte to re-approach the United States and restored the military agreement with the United States, that makes it easier for US military forces to move in and out the country.

Defence Budget, Defence Procurements and Defence Procurements Policy

Since 2019 the Defence Budget of the Philippines has increased drastically by 29.65% after a sharp drop by -30.61% recorded between 2017-2018. The Defence Budget of the country was increased twice between 2019-2021. The first increase was in 2019, when the Defence Budget of the Philippines was increased by 22.1% compared to 2018 and reached US$3.47 Billion (in current US$ prices). The second increase was recorded in 2020 by 7.52% compared to 2019 and the Defence Budget reached US$3.73 Billion (in current US$ prices).

For 2021 the Government has allocated US$4.3 Billion (in current US$ prices) increased by 14% compared to the Defence Budget of 2020.

According to Jane’s 15.8% of the 2021 Defence Budget will be allocated for military procurement under the Revised Armed Forces of the Philippines Modernization Program (RAFPMP) indicating an additional increase. The previous years this program had been receiving approximately USD500 million a year.

According to the Department of Budget and Management of the Government of the Philippines, the Army will receive the bulk of the funding in 2021 with the allocation of approximately US$1.99 Billion, the Philippine Navy will receive US$637,5 Million and the Air Force will receive US$612.8 Million. Finally, US$933.6 Million will be allocated to the Headquarters of the Armed Forces of the Philippines.

It is important to mention that this allocation includes also funding for the military procurement under the Revised Armed Forces of the Armed Forces. The increase of the Defence Budget comes as a result to the Defence Policy of the Duterte Government.

In one of his speeches Duterte said that the increase of the 2021 Defence Budget will help to address threats and combat terrorism a reference to the country’s two major security challenges the protection of the Philippine interests in the South China Sea and the battle against internal insurgency.     

The first methodically long-term organized attempt to modernize the equipment of the Armed Forces of the Philippines took place on 23rd February of 1995. The modernization program was initiated by the then President Fidel V. Ramos with the Armed Forces of the Philippines (AFP) Modernization Act officially designated as Republic Act No. 7898.

The Philippine Law Republic Act No. 7898 intended to last for 15 years with an initial budget of 50 Billion Ph Pesos for the first five years, but unfortunately the funding of the Modernization program was stopped due to the 1997 Asian financial crisis.

The funding Modernization program was halted and later neglected by the Governments of the Philippines until the law expired in 2010.

Few years later, on the 11th of December 2012, the Modernization program was amended under the then President Benigno Aquino III, by the Republic Act No. 10349 also known as the Revised AFP Modernization Act. The new law extends the Modernization program for another 15 years till 2028.

The initial budget for the first 5 years phase was 75 Billion Ph Pesos. The new law intends to prepare and equip the Armed Forces of the Philippines with the appropriate military systems in order to address the assessed threats such as the sea dispute with China in the Spratly Islands along with Vietnam, Taiwan, Brunei, and Malaysia.

The revised Modernization program was divided into three Horizons. The first was implemented from 2013 to 2017 the second is under implementation and covers the time of 2018-2022 and the third is from 2023 till 2028. The total cost of the revised AFP Modernization Act is USD40 Billion.

The second phase of the Modernization program (Horizon 2) was initiated on the 20th of June 2018 by President Rodrigo Duterte and the total cost of that phase is US$5.6 Billion.

The Horizon 1 & 2 include 145 modernization programs. Among them there are 16 major procurement programs for the Air Force either at the stage of completion or initiation of the Horizon 1& 2 procurement programs.

These are:

  • 12 South Korean made Light Fighter jet FA-50PH
  • 13 Italian made light twin helicopter AW-109 Power
  • 3 brand new C-295 Medium Lift Fixed Wing Aircraft
  • 2 brand new Light Lift Fixed Wing Aircraft
  • 3 units of Full Motion Flight Simulators
  • 21 used refurbished UH-1H helicopters
  • New Fighter Jet
  • The Brazilian made Light Attack Aircraft A-29B Super Tucanos (6+12+6 units)
  • 8 used Bell-412 helicopters from Canada
  • 6 Turkish made T129 ATAK Attack helicopters
  • 2 used C-130H Hercules from U.S.A
  • 3 Batteries of Israeli made SPYDER air defence system (funded with 5.71 Billion Ph Pesos (USD112,7 Million or according to, other sources USD130 Million) at 2020 and 2021) to meet the requirement of the Ground Based Air Defense System (GBADS). The mobile system integrates the short-range Python V and the medium-range Derby missiles supported by the Elta EL/M 2016 ATAR 3D surveillance radar affixed to the mobile command and control unit.
  • 4 Israeli made Hermes 450 UAS
  • 9 Israeli made Hermes 900 UAS
  • 6 U.S made Boeing Insitu ScanEagle UAS
  • 16 U.S made S-70i helicopters (USD241 Million)  
  • New C4I system
  • 5 new C-130J

The Horizon 1 & 2 includes the completion or initiation of 15 major procurement programs for the Army

These are:

  • 18 K136 Multiple Rocket Launchers from South Korea  
  • 12 ATMOS 2000 Self Propelled Howitzer from Israel
  • Handheld radios
  • Night Fighting equipment
  • 63,000 new M4 rifles from the U.S.A
  • 44,080 force protection equipment sets
  • 18 ASCOD Sabrah Light Tank equipped with a 105mm gun from Spain & Israel
  • 2 ASCOD 2 Command Vehicle from Spain & Israel
  • 1 ASCOD 2 ARV from Spain & Israel
  • 2 Panzerschnellbrücke Joint Assault Bridge from U.S.A, Germany and Israel
  • 10 Pandur II 8x8 Sabrah Tank Destroyer equipped with a 105mm gun from Czech Republic and Israel  
  • 2 Pandur II Command Vehicle
  • 28 VBTP/VBCI APC from Brazil and Israel
  • 6 Kunduz Armored Combat Earthmover from Turkey
  • 5 Cardom 81 mortars and 15 Cardom 120 mortars from Israel

The Horizon 1 & 2 includes the completion or initiation of major procurement programs for the Navy and the Marine Corps.

These are:

  • 2 Jose Rizal-class frigates from South Korea
  • 2 Hamilton-class used cutters from USA
  • 2 Tarlac-class LPD from Indonesia
  • 1 Pohang-class corvette from South Korea
  • 2 new AgustaWestland AW159 anti-submarine helicopters from UK (USD111 Million)
  • The first ever Submarine of the Philippine Navy
  • Number of Spike-ER missiles for the Marine Coprs 
  • 8 ScanEagle 2 UAS from USA
  • 2 new LPD vessels
  • New shore based long range cruise missiles for coastal defence