Philippines to Increase External Defense Budget in Face of South China Sea Tensions.

The Philippine government has proposed a significant increase in its defense budget for 2025, raising the allocation to $4.38 billion (approximately 256.1 billion pesos), marking a 6.4% increase from the current year. This decision comes as Manila seeks to modernize its armed forces and bolster its external defense capabilities amid escalating tensions with China over territorial disputes in the South China Sea.
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Republic of the Philippines Navy ship BRP Apolinario Mabini  (Picture source: US DoD)

According to the Budget Ministry, this defense budget will account for 4.0% of the government's overall spending plan, estimated at $136.64 billion (6.35 trillion pesos) for the coming year. This plan was submitted to Congress for approval this Monday.

A significant portion of this budget, approximately $4.4 billion (204.4 billion pesos), will be allocated to defense programs for the land, air, and naval forces. Additionally, $1.07 billion (50 billion pesos) will be dedicated to revising the armed forces' modernization plan, indicating a strategic shift from internal to external defense.

Budget Secretary Amenah Pangandaman emphasized to legislators that these investments are crucial to "defend our sovereignty and territorial integrity."

This budget increase follows a "provisional arrangement" recently reached between the Philippines and China regarding resupply missions to the contested Second Thomas Shoal in the South China Sea. Despite this agreement, the Philippines has stated that it will continue to assert its rights in the region, supported by a 2016 ruling from the Permanent Court of Arbitration in The Hague, which invalidated China's expansive claims in the area.

The Philippine Coast Guard, which plays a key role in monitoring and escorting missions in the South China Sea, will also see a 6% increase in its budget, reaching $674.8 million (31.4 billion pesos).

The total state budget for 2025, which represents 22% of the country's GDP, will increase by 10.1% from the current year. This budget increase is part of President Ferdinand Marcos' efforts to stimulate the national economy, with growth targets of up to 8% and significant poverty reduction.