The Philippines is positioning itself as the next major manufacturing and logistics hub in Asia, leveraging its strengthening ties with the United States. This strategic move comes as part of a broader effort to enhance defense and economic collaborations under the current administration.
Recently, the U.S. pledged to boost investments in the Philippines’ transport infrastructure, clean energy, and semiconductor supply chains through the Luzon Economic Corridor. These commitments aim to enhance freight transport services, improve mobility, and provide access to key economic zones, thereby ensuring business continuity and establishing the Philippines as a pivotal regional hub for agribusiness and logistics in the Asia-Pacific region.
“These initiatives will position the Philippines as a key player in the regional logistics sector,” said the country’s leader at the 6th Indo-Pacific Business Forum held in Manila on May 21. The infrastructure program, which includes 185 priority projects valued at 9.5 trillion pesos ($163 billion), is seen as a crucial step toward realizing this goal.
However, this ambition places the Philippines in direct competition with neighboring countries such as Vietnam and Indonesia, which are also vying to attract significant investments in manufacturing and logistics. These Southeast Asian nations are leveraging their skilled and affordable labor forces to secure a share of the investment influx driven by global de-risking efforts.
Despite being one of the region’s fastest-growing economies, the Philippines has lagged behind in attracting foreign investments compared to its neighbors. Last year, net inflows of foreign direct investments to the country decreased by 7% to $8.9 billion.
The business forum is part of ongoing efforts to strengthen economic relations with international partners, as the country seeks greater integration into global value chains and an increase in foreign direct investments to sustain its economic growth. “An economically strong Philippines will be a valuable ally in the region,” the leader emphasized.
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