The Philippines reshapes its policies on the U.S. and China
President Marcos’ foreign policy balances sovereignty, the U.S. alliance and economic ties with China.
In a nutshell
- Marcos sought neutrality but is shifting to the U.S. amid Chinese maritime aggression
- Philippine withdrawal from China’s Belt and Road Initiative enhances ties with U.S.
- South China Sea tensions persist and diplomatic breakthroughs are unlikely
At the outset of his presidency, President Ferdinand Marcos Jr. expressed his conviction that the Philippines would not choose between the United States and China. In his June 2022 inauguration speech, he pledged to protect the nation’s sovereignty while maintaining an independent foreign policy, which entails remaining “a friend to all and enemy to none.” Seeking to maintain positive relationships with all major powers, this outlook is comparable to that of Association of the Southeast Asian Nations (ASEAN) co-members Indonesia or Vietnam.
But in the ensuing years, China has ramped up its aggressive behavior in the South China Sea, causing alarm among some ASEAN states, especially the Philippines, leading President Marcos to double down on Manila’s longstanding alliance with Washington. The strategic shift toward conventional alliances is based on cooperation with the U.S. and neighboring powers such as Japan.
Since the inauguration of mercurial U.S. President Donald Trump, to reduce tensions and keep the country’s options open, Mr. Marcos has offered to cooperate with China, on the condition that Beijing stop harassing Philippine vessels with violent maritime provocations and expansive territorial claims.
China has ramped up its aggressive behavior in the South China Sea, causing alarm among some ASEAN states.
The offer, however, appears to be a longshot. Hopes in Manila that China would adopt a more cooperative stance and live up to its promises have repeatedly been dashed. During the previous Philippine administration, China continued with its revisionist policies in the South China Sea and promised investments that never materialized. China’s harassment of Philippine vessels and aircraft persists.
On February 18, a Chinese People’s Liberation Army helicopter recklessly flew within three meters of a Philippine patrol plane over the uninhabited Scarborough Shoal roughly 220 kilometers west of the island of Luzon. The area is a rich fishing ground within the Philippines’ Exclusive Economic Zone, but nevertheless, China claims it as its own. The following day, the U.S. Department of State responded, condemning the “unsafe and irresponsible actions,” calling on China to halt its coercive actions and saying the Trump administration will continue to support U.S. allies to ensure a free and open Indo-Pacific.
Olive branches for Beijing
When he became president, Mr. Marcos was perceived as a pro-China candidate that would maintain the foreign policy views of his predecessor, Rodrigo Duterte, who sought to foster amicable relationships with Beijing and implemented anti-American rhetoric during the majority of his time in office. On an official visit to China in 2016, Mr. Duterte declared a “separation” from Washington, Manila’s long-standing ally, both in defense and trade.
His statement, in which he threatened to terminate the Visiting Forces Agreement due to the American cancelation of the visa of his former police chief, who had led the Philippines’ deadly drug war, was another demonstration of Mr. Duterte’s skepticism toward the U.S. Additionally, in a diplomatic snub, President Duterte declined an invitation from President Trump to attend the U.S.-ASEAN Summit in March 2020.
The deadly war on illegal drugs that the former president waged, with summary extrajudicial executions, had been the subject of concern in Washington. In little more than one year, from June 2016, when he assumed office, to August 2017, Mr. Duterte’s policy resulted in 12,000 Filipinos losing their lives. Conversely, China, which itself is the main source of precursors to the deadly drug fentanyl that has contributed to the deaths of hundreds of thousands of Americans, endorsed President Duterte’s controversial efforts to combat illegal narcotics. His predisposition not to publicize territorial disputes in the South China Sea was also indicative of Mr. Duterte’s overtures to China.
For his part, President Marcos had stated that the 2016 arbitral tribunal ruling on the South China Sea is ineffective and that he would pursue a bilateral agreement with China, the approach that Beijing has consistently favored with other claimant countries. But China’s size gives it an advantage in bilateral discussions.
Territorial disputes are the Achilles’ heel in relations
Beijing has overlapping claims to the Spratlys, a collection of islands in the South China Sea, with the Philippines, Vietnam and other littoral states. China initiated a race to build up artificial islands in the South China Sea and has militarized them, further exacerbating regional tensions that are evident in Beijing’s criticism of Vietnam in February 2025, for developing its own artificial islands.
Over the past two years, Sino-Philippine disputes in the Second Thomas Shoal, a submerged reef 105 nautical miles from the Philippines’ Palawan Island and about 600 nautical miles from China’s Hainan Island, have been progressively intensifying, driving Manila into Washington’s embrace.
Today’s situation has roots in events of the 1990s. China’s extensive claims encompass nearly the entire South China Sea, and the country initially occupied the Mischief Reefs in 1995. To protect Philippine claims to the area, in 1999 Manila intentionally grounded the BRP Sierra Madre, a Philippine Navy transport ship originally built and used by the U.S. to serve in World War II, in the Second Thomas Shoal. Manila has a contingent of its marines housed on the ship as a Philippine maritime outpost. But as Beijing has maintained a consistent coast guard patrol in the Second Thomas Shoal since 2013, Manila’s regular resupply missions to the ship have become flashpoints in ongoing disputes with Beijing. This struggle has become a symbol of the Filipino fight for sovereignty.
Lately, the number of Chinese vessels in the area has increased. Only one ship was observed during a Philippine resupply mission in 2021; but by 2023, the number increased to up to 14.
Enough is enough for Manila
In 2023, President Marcos made a noticeable turn toward strengthening the Philippines’ ties with the U.S. As a result of the regional security dynamic, the transition has become more pronounced, with the growing tension in the South China Sea being a significant factor.
In February of that year, a notable incident occurred when a Chinese coast guard vessel was accused of targeting a Filipino coast guard boat with a military grade laser that temporarily blinded the crew during a resupply voyage to sailors on the Sierra Madre. Washington condemned the provocative action and expressed its support for Manila.
Then in August, Chinese Coast Guard and maritime militia vessels employed water cannons to impede the movement of Filipino boats in the vicinity of the shoal. At the end of that year, Beijing and Manila exchanged accusations regarding a collision near the Second Thomas Shoal. China’s coast guard accused the Philippines of deliberately ramming its ship, while the Philippines accused China of using water cannons to intimidate its sailors and ramming the resupply vessels. China defended its actions, claiming it was a legal control measure, and said the Filipino boats had illegally invaded its waters.
The 2023 expansion of the Enhanced Defense Cooperation Agreement (EDCA) with the U.S. was one of the pivotal events reflecting President Marcos’s administration’s re-embrace of America. This agreement enables Washington to increase the presence of its military and access to additional Philippines bases by adding four additional sites, bringing the total number of EDCA locations to nine.
The Philippines has been implementing additional measures in response to China’s increasingly assertive conduct in the now-disputed waters. These include high-level meetings and military exercises with the U.S. and its allies in the region, including Japan. In April 2024, the first-ever trilateral meeting between Washington, Tokyo and Manila was held, during which then President Joe Biden reaffirmed America’s defense commitment to both Japan and the Philippines. Mr. Biden stated that any attack on the aircraft, vessels or armed forces of the Philippines in the South China Sea would trigger the 1951 mutual defense treaty between the two nations.
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A significant escalation then occurred in June 2024, when Chinese coast guard personnel, equipped with knives, forcibly boarded a Filipino vessel transporting supplies to troops stationed in the Second Thomas Shoal. The incident resulted in injuries to the Filipino crew. During the Shangri-La dialogue prior to the incident, President Marcos declared that the mutual defense treaty with the U.S. would be invoked if a Filipino soldier was killed in a willful act, considered to be a red line.
The U.S. and Philippines conduct annual joint military drills intended to improve the interoperability of the two militaries. The 2024 Balikatan, or “shoulder-to-shoulder” joint military exercises, were by far the largest cooperative military operation between the two countries to date. The exercises included 17,000 soldiers from the two countries as well as 250 French and Australian forces, and simulated retaking enemy-occupied islands and maritime maneuvers in the South China Sea.
The exercises are a statement from President Marcos to China that his administration is serious about safeguarding Philippine sovereignty, as well as demonstrating that going forward his country will remain a vital component of the U.S. integrated deterrence strategy to contain China in the Indo-Pacific region.
The Philippines’ trading partners
Yet despite the conflicts with Beijing, trade with China remains important to Manila. Like other ASEAN member states, the Philippines maintains robust trade relations with China. As of 2024, China was Manila’s third-largest export destination, only behind the U.S. and Japan, respectively. The U.S. is the Philippines’ primary export destination, accounting for nearly $950 million, or 17 percent of total exports, in 2024.
Amid the contentious disputes in the South China Sea, President Marcos’ announcement in November 2023 of the Philippines’ withdrawal from China’s Belt and Road Initiative (BRI) was another significant non-military event underscoring the Philippines’ ongoing pivot away from China. When Mr. Duterte was in office, China offered to lend a substantial sum of $24 billion for a large infrastructure projects under the BRI, in exchange for leniency on the South China Sea issue. However, Beijing’s pledged funds for infrastructure projects in the Philippines never materialized.
Scenarios
Likely: Amid Chinese provocations, the Philippines remains a firm U.S. ally
President Marcos is likely to continue standing up to China and its massive maritime claims. This position has recently gained strength, given the Trump administration stating in January, only days after the inauguration, that the U.S. remains committed to the Philippines’ defense.
Regional circumstances, such as the situation in the Spratly Islands, significantly influence Philippine policy. The shift during the Marcos administration, in contrast to his predecessor’s, which appeared hesitant to confront China on the issue of South China Sea, exemplifies this dynamic nature. The 2024 announcement of the PGI Luzon corridor project with the U.S. and Japan aims to stimulate economic growth in the Philippines by improving infrastructure, including railways and ports. The Trump administration is likely to maintain the trilateral commitment.
Unlikely: Resolution of South China Sea tensions
An improvement in relations between China and the Philippines, and a subsequent calming of nerves around the South China Sea is unlikely, not least because of Chinese maritime provocations, but also as regional willingness to borrow from China is waning. Manila and other ASEAN countries have learned that Beijing’s pledges of considerable amounts of money may not always materialize, throwing into question the BRI’s reliability.
Laos, like Cambodia, is closely aligned with China, but Vientiane is currently experiencing difficulty repaying its substantial debt from BRI projects to Beijing. Manila too has debt concerns that will prevent the Philippines from accepting loans from China.
In terms of security, the increasing frequency of incidents in the South China Sea between the Philippines and China, including ramming, collisions and ship boardings, will prevent progress on the South China Sea Code of Conduct, which is meant to prevent future escalation. Among the hurdles preventing an easing of tensions is that a provision of the code of conduct would prohibit joint military drills between ASEAN members and other powers, such as the U.S. and Japan. As a result, it is unlikely to be finalized in the foreseeable future.
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