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Analysts ask Manila to lure Japanese investors to local defense sector

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June 8, 2025
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Analysts ask Manila to lure Japanese investors to local defense sector
MEMBERS of the Philippine Coast Guard participate in drills to improve search and rescue collaboration, and enforcement during the first trilateral coast guard exercise between the Philippines, Japan, and the US, at the coast of Bataan in the South China Sea, June 6, 2023. — REUTERS

By Adrian H. Halili, Reporter

THE PHILIPPINES should lure Japanese investors to its defense industry after the Japanese Parliament’s ratification of a reciprocal access agreement (RAA) between Manila and Tokyo, political analysts said.

“They must be viewed as potential investors in the defense industrial sector, which the Self-Reliant Defense Posture law aims to establish,” Michael Henry Ll. Yusingco, a senior research fellow at the Ateneo Policy Center, said in a Facebook Messenger chat. “The RAA with Japan only bolsters the chances of achieving this goal.”

He said the access deal, which lays down the rules for visiting soldiers from both nations during war games, should add urgency for the Marcos government to boost its defense industry.

Republic Act No. 12024 or the Self-Reliant Defense Posture Revitalization Act seeks to boost local production of defense equipment and will let the Philippines develop technologies to counter threats.

Mr. Yusingco said the government should work on the institutional foundation of the country’s self-reliant defense industry. “So far, it appears it is not doing enough towards this end.”

Last week, the Department of Foreign Affairs said Japan’s Diet had approved the RAA.

Manila and Tokyo signed the military pact in July 2024, allowing for the entry of equipment and troops for military drills and disaster response on each other’s soil. The Philippine Senate in December ratified the deal.

“Aside from our military being able to learn best practices from Japan, they will also have an appreciation of state-of-the-art weapons that can be brought here by Japan for military exercises, which the (Armed Forces of the Philippines) may also employ in the near future,” Josue Raphael J. Cortez, a diplomacy instructor at De La Salle-College of St. Benilde’s School of Diplomacy and Governance, said.

Manila is seeking to bolster its defense capabilities amid worsening tensions with Beijing in the South China Sea. It has also increased its defense budget, with about P35 billion allotted to modernize its military in the next decade.

‘SHARED ASPIRATIONS’The Philippine-Japan access deal is the first of its kind to be signed by Japan in Asia and coincides with increased Chinese assertiveness in the South China Sea, where Beijing’s expansive claims conflict with those of several Southeast Asian nations.

“This agreement adds another layer on how we can reach our shared aspirations for the region, particularly in promoting freedom of navigation,” Mr. Cortez said. “With our region becoming more and more viable in global trade presently, forging such an agreement is integral in ensuring that aside from maintaining our territorial integrity, we can also be a prime mover in ensuring a rules-based order within the open seas in our region.”

Rommel C. Banlaoi, president of the Philippine Society for International Security Studies, said the Philippine-Japan pact could irk China.

“The reciprocal access agreement will solidify US-Japan-Philippine security cooperation because of its juridical status,” he said in a Viber message. “But this will escalate the risk of the Philippines having a serious conflict with China.”

He added that China would not take the agreement lightly since its views it as a mere “containment strategy of the US with its Asian allies.”

This could exert pressure on China since it also has a dispute with Japan over the Diaoyu and Senkaku Islands,” Mr. Cortez said.

“We are achieving trust and reliability from Japan and the US, elevating the scalability of our security cooperation in the region,” Chester B. Cabalza, founding president of Manila-based think tank International Development and Security Cooperation, said via Messenger chat.

He added that China could counter the deal by courting more Association of Southeast Asian Nations (ASEAN) member countries to side with them through diplomatic, economic and military partnerships.

“We will see more by the time Manila chairs the ASEAN Summit next year,” he said.

China claims over 80% of the South China Sea, but a United Nations-backed tribunal in The Hague voided its claim in 2016 for being illegal.

The Philippines and China have repeatedly clashed in the disputed waterway, with both sides accusing each other of raising tensions.

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