The Philippines finds itself at the epicenter of a high-stakes geopolitical chess game, where its strategic location in the Indo-Pacific places it at the crossroads of the U.S. China competition. With over 7,600 islands forming part of the First Island Chain, the country serves as a critical anchor for Washington’s efforts to counter Beijing’s assertiveness in the South China Sea and beyond. Recent moves, such as granting the U.S. expanded access to military bases under the Enhanced Defense Cooperation Agreement (EDCA), signal Manila’s growing alignment with U.S. strategic goals.
However, this partnership is not without its challenges. The Philippines must navigate the risks of becoming entangled in a potential flashpoint, all while managing its complex economic ties with China and maintaining regional stability. As tensions in the Indo-Pacific intensify, the Philippines is walking a tightrope, balancing security commitments and diplomatic prudence in a rapidly shifting geopolitical landscape.
The South China Sea: A Powder Keg of Global Tensions
The South China Sea has transformed into one of the world’s most contested regions, hosting a staggering $3.37 trillion worth of trade annually, which accounts for nearly 30% of global maritime commerce. Beneath its waters lies another prize: an estimated 11 billion barrels of untapped oil and 190 trillion cubic feet of natural gas. But this resource-rich expanse has also become the frontline of a geopolitical showdown, with China asserting dominance through expansive claims and militarization.
China’s Nine-Dash Line: Defiance of International Law
China’s nine-dash line, encompassing nearly 90% of the South China Sea, remains at the heart of the dispute. This sweeping claim, rejected by the Hague Arbitral Tribunal in 2016, covers areas that overlap with the Exclusive Economic Zones (EEZs) of neighboring nations, including the Philippines, Vietnam, and Malaysia. Despite the tribunal ruling, China has doubled down, building artificial islands equipped with airstrips, radar systems, and missile batteries. The militarization of features like Fiery Cross Reef and Mischief Reef has heightened tensions, threatening the sovereignty of smaller claimant states.
The Philippines: Caught in the Crossfire
Positioned at the gateway to the South China Sea, the Philippines has emerged as a focal point in the U.S.-China rivalry. With its 2016 legal victory over China’s claims largely ignored, Manila has leaned on its alliance with the U.S. for security guarantees. The Philippines hosts more than 300 joint military exercises with U.S. forces annually, signaling its pivotal role in the Indo-Pacific strategy. Yet, this partnership is not without risks, as it exposes the country to potential escalation in a future conflict.
The Stakes: Regional Stability at Risk
The South China Sea isn’t just a regional dispute, it’s a litmus test for global power dynamics. With over 40% of the world’s liquefied natural gas (LNG) shipments passing through its waters, any conflict could disrupt energy supplies, triggering global economic shocks. For the Philippines and its neighbors, the challenge lies in balancing national sovereignty with the risks of entanglement in a U.S.-China confrontation. As the world watches this geopolitical drama unfold, the South China Sea remains more than just a body of water—it’s the stage for the 21st century’s most consequential contest of power.
Geopolitical Perspectives: Balancing Alliances and Regional Stability
The evolving dynamics in the South China Sea have made the Philippines a focal point of strategic discussions among U.S. think tanks, such as the Center for Strategic and International Studies (CSIS) and the RAND Corporation. These institutions provide valuable insights into how the U.S.-Philippines partnership can be leveraged to address rising tensions while avoiding potential pitfalls in the volatile Indo-Pacific region.
According to the Center for Strategic and International Studies (CSIS), the Philippines is essential to preserving regional security and thwarting China’s aggression in the South China Sea. The Philippines provides an essential platform for U.S. military operations due to its strategic location close to Taiwan and the disputed waters. By boosting access to strategic bases under the Enhanced Defense Cooperation Agreement (EDCA), extending joint military exercises, and providing the Philippines with cutting-edge military technology, CSIS fervently supports fortifying the U.S.-Philippines partnership.
In addition to military cooperation, CSIS highlights the value of economic and developmental assistance in resolving domestic issues in the Philippines. By using a dual approach, the partnership is viewed as advantageous to both parties, strengthening local support and furthering American strategic objectives.
The RAND Corporation, on the other hand, takes a more cautious and balanced stance, cautioning against the dangers of relying too much on the Philippines. RAND emphasizes that the United States needs to take into account Philippine concerns, especially those related to the possibility of local opposition to a larger military presence.
The research group also emphasizes the risks of provocative deployments close to disputed areas, which might worsen relations with China. In order to manage disagreements and prevent needless war, RAND supports a strategy that combines strong deterrence with diplomatic engagement, encouraging communication with China. By doing this, the United States can protect its interests without making its partnership with the Philippines too militarized.
When taken as a whole, these viewpoints show the careful balancing act needed to manage the U.S.-Philippines relationship in the South China Sea. RAND stresses the significance of coordinating these initiatives with more general diplomatic and developmental aims, whereas CSIS concentrates on using the Philippines’ advantageous location for military purposes. Developing a flexible and nuanced approach will be crucial to maintaining stability and safeguarding both countries’ common interests as Indo-Pacific tensions continue to increase.
ASEAN Perspectives: Neutrality Amidst Great Power Rivalry
The Association of Southeast Asian Nations (ASEAN) finds itself in a delicate position as the South China Sea dispute intensifies. While the region’s security and economic stability are deeply tied to the maritime tensions between the U.S. and China, most ASEAN member states have opted for a neutral stance to avoid becoming entangled in the rivalry of these global powers. This approach reflects ASEAN’s commitment to regional cohesion and its principle of non-alignment in international conflicts.
Neutrality as a Survival Strategy
ASEAN countries, including Malaysia, Vietnam, and Indonesia, face significant pressure to take sides in the U.S.-China competition. However, neutrality remains the prevailing strategy, driven by economic and political realities. China is the largest trading partner for many ASEAN nations, with trade between ASEAN and China exceeding $975 billion in 2023. Simultaneously, the U.S. remains a critical security partner, providing military aid and conducting joint exercises with several member states.
Balancing these relationships is essential for ASEAN nations, which prioritize avoiding direct confrontation while securing economic and security benefits from both sides. For instance, the U.S. Department of Defense has outlined plans to convene a second ASEAN-U.S. maritime exercise in 2025, co-hosted by Indonesia, to enhance regional security cooperation.
The Code of Conduct: An Elusive Goal
ASEAN has pushed for the creation of a Code of Conduct (COC) to manage disagreements and avoid confrontations in the disputed waters in order to alleviate tensions in the South China Sea. Since they started in 2002, COC negotiations have been sluggish and frequently hampered by conflicting interests. A major player in the negotiations, China has opposed legally binding clauses that might restrict its operations in the area.
At best, progress is still incremental. ASEAN claimed some achievements in drafting the COC, but clear agreements on enforcement measures and dispute resolution remain elusive. Despite its shortcomings, the COC is viewed by ASEAN as a key tool for facilitating communication and lowering the risk of escalation in the South China Sea.
ASEAN’s Balancing Act
ASEAN’s approach to the South China Sea reflects its broader strategy of balancing great power competition while preserving its own unity. While the bloc seeks to avoid direct involvement in U.S.-China tensions, it continues to push for regional solutions like the COC to address disputes. This cautious but pragmatic approach underscores ASEAN’s role as a stabilizing force in the Indo-Pacific, even as challenges persist in managing its diverse member states’ interests.
Philippine Think Tanks: Balancing Power with Diplomacy
Philippine think tanks, such as the Stratbase ADR Institute, advocate for an independent foreign policy that carefully balances the country’s security alliance with the United States and its economic engagement with China. They emphasize that while the U.S. is a crucial partner in enhancing defense capabilities, pragmatic ties with China are necessary for trade and investment. In 2024, China was the Philippines’ largest trading partner, with bilateral trade reaching $38.35 billion, underscoring the economic interdependence.
Stratbase ADR stresses the importance of diplomatic efforts in de-escalating tensions in the South China Sea. They recommend leveraging international law, particularly the 2016 Hague Arbitral Tribunal ruling that invalidated China’s nine-dash line, as a basis for peaceful negotiations. They also advocate strengthening regional cooperation within ASEAN to promote a unified stance against unilateral actions in disputed waters.
Chinese Think Tanks: Criticizing U.S. Presence and Defending Claims
Chinese think tanks, such as the China Institute of International Studies (CIIS), view the U.S. military presence in the Indo-Pacific as a destabilizing factor. CIIS argues that U.S. freedom of navigation operations and increased military deployments in the South China Sea escalate tensions and threaten regional peace. In 2023, the U.S. conducted 12 major naval operations in the area, a move criticized by CIIS as provocative.
CIIS strongly defends China’s claims in the South China Sea, framing them as historically legitimate. The think tank often downplays the concerns of other claimant states, asserting that disputes can be managed bilaterally without external interference. CIIS also promotes China’s “win-win” approach, emphasizing economic initiatives like the Belt and Road Initiative, through which China invested over $3 billion in ASEAN projects in 2024, to foster regional goodwill while strengthening its strategic influence.
Philippines’ Strategic Importance: A Keystone in the Indo-Pacific
Geopolitical Location
The Philippines’ geographical position places it at the crossroads of critical maritime chokepoints, making it an indispensable component of global trade and regional security. The Luzon Strait and the Malacca Strait, two of the most vital shipping lanes, pass near the Philippines, with over 50% of global trade transiting through the latter. This makes the country an essential node for the free flow of international commerce. The Philippines’ proximity to Taiwan, located just 200 miles away, adds a military dimension to its strategic importance, offering the U.S. a forward base for potential operations in the event of a crisis in the Taiwan Strait.
The archipelago’s vast coastline, stretching across more than 7,641 islands, provides the Philippines with unparalleled options for military bases, surveillance infrastructure, and logistical support. This geographic advantage allows for greater flexibility in managing security challenges, from maritime patrols to humanitarian aid deployments.
Military Capabilities
The Philippines is in the midst of an ambitious military modernization program aimed at enhancing its defense capabilities amidst growing regional tensions. Notable acquisitions include new naval frigates and missile corvettes designed to bolster the country’s ability to patrol and secure its extensive waters. The purchase of FA-50 fighter jets and the integration of advanced missile defense systems further strengthen the Philippines’ military deterrence.
The U.S.-Philippines Mutual Defense Treaty (MDT), originally signed in 1951, remains a cornerstone of the security relationship between the two countries. The MDT enables joint military exercises, intelligence sharing, and the potential for U.S. access to Philippine bases in times of need, cementing the Philippines’ role as a key partner in the U.S. strategy to counter China’s growing influence in the Indo-Pacific. As a founding member of ASEAN, the Philippines also plays a pivotal role in shaping the region’s security landscape, helping to drive collective responses to regional challenges such as China’s assertive actions in the South China Sea.
Potential Contributions to the U.S. Strategy
Military Bases
The Enhanced Defense Cooperation Agreement (EDCA) allows the U.S. military to access five strategically located bases across the Philippines, with plans to expand this access. These bases provide the U.S. with essential operational reach, enabling rapid deployment of forces and facilitating surveillance and reconnaissance missions. The Philippines’ geographical proximity to key regional flashpoints, such as the South China Sea and Taiwan, positions it as a crucial partner in U.S. military strategy.
The Philippines actively participates in joint military exercises with the U.S., such as the annual Balikatan exercises, which enhance interoperability between the two forces. These exercises improve coordination in areas like maritime security, disaster response, and counterterrorism operations. The Philippines’ role in maritime security operations is also vital, as it contributes to securing its territorial waters and countering illegal fishing activities, particularly in the South China Sea.
The Philippines’ experience in Humanitarian Assistance and Disaster Relief (HADR) operations can be leveraged for regional disaster response efforts, strengthening cooperation with the U.S. and other allies in times of crisis.
Challenges and Considerations
Economic Repercussions
While the Philippines benefits from its alliance with the U.S., it faces economic risks tied to its deepening trade relations with China, its largest trading partner. In 2024, bilateral trade with China surpassed $38 billion, highlighting the Philippines’ reliance on China for exports, imports, and investments. Heightened tensions in the South China Sea or military escalation could disrupt this vital economic relationship. China’s economic coercion tactics—such as limiting tourism or imposing trade restrictions—pose a significant risk to the Philippines. Beijing has previously used such measures in response to perceived affronts, and its ability to target the Philippine economy remains a potent tool in its geopolitical arsenal.
Risk of Escalation
The growing U.S. military presence in the region carries the risk of inadvertently escalating tensions. Increased U.S. operations, particularly in contested areas like the South China Sea, could provoke reactions from China, including military posturing or more aggressive actions in disputed zones. Unintended incidents, such as maritime confrontations or miscalculations, could easily spiral into broader conflict, which would be disastrous for all parties involved.
Domestic Concerns
Public opinion in the Philippines regarding its alignment with the U.S. is divided. While some see the U.S. as an essential security partner in countering China, others express concerns over the long-term implications of deeper military entanglements. Political instability and changing administrations could complicate the Philippines’ ability to navigate these complex geopolitical dynamics effectively, impacting its foreign policy and defense posture.
Conclusion
The Philippines’ strategic importance in the U.S. Indo-Pacific strategy is undeniable, from its control of key maritime chokepoints to its evolving military capabilities. However, balancing the economic benefits of trade with China and the security obligations to the U.S. presents a complex challenge. While the Philippines can play a critical role in regional security, its future direction will depend on navigating a delicate geopolitical landscape—ensuring national sovereignty, economic stability, and regional peace amidst intensifying global rivalries.
