FOREIGN
RELATIONS
In its foreign policy, the Philippines cultivates constructive relations with its Asian neighbors, with whom it is linked through membership in the Association of Southeast Asian Nations (ASEAN), the ASEAN Regional Forum (ARF), and the Asia-Pacific Economic Cooperation (APEC) forum. The Philippines chaired ASEAN from 2006 to 2007, hosting the ASEAN Heads of State Summit and the ASEAN Regional Forum. The Philippines is a member of the UN and some of its specialized agencies, and served a two-year term as a member of the UN Security Council from January 2004-2006, acting as UNSC President in September 2005. Since 1992, the Philippines has been a member of the Non-Aligned Movement. The government is seeking observer status in the Organization of the Islamic Conference (OIC). The Philippines has played a key role in ASEAN in recent years and also values its relations with the countries of the Middle East, in no small part because hundreds of thousands of Filipinos are employed in that region. The welfare of the some four to five million overseas Filipino contract workers is considered to be a pillar of Philippine foreign policy. Foreign exchange remittances from these workers exceed 11% of the country's gross domestic product.
The fundamental Philippine attachment to democracy and human rights is also
reflected in its foreign policy. Philippine soldiers and police have
participated in a number of multilateral civilian police and peacekeeping
operations, and a Philippine Army general served as the first commander of the
UN Peacekeeping Operation in East Timor. The Philippines presently has
peacekeepers in Haiti and Liberia. The Philippines also participated in
Operation Iraqi Freedom, deploying some 50 troops to Iraq in 2003. (These troops
were subsequently withdrawn in 2004 after a Filipino overseas worker was
kidnapped.) The Philippine Government also has been active in efforts to reduce
tensions among rival claimants to the territories and waters of the
resource-rich South China Sea.
U.S.-PHILIPPINE
RELATIONS
U.S.-Philippine relations are based on shared history and commitment to democratic principles, as well as on economic ties. The historical and cultural links between the Philippines and the U.S. remain strong. The Philippines modeled its governmental institutions on those of the U.S. and continues to share a commitment to democracy and human rights. At the most fundamental level of bilateral relations, human links continue to form a strong bridge between the two countries. There are an estimated four million Americans of Philippine ancestry in the United States, and more than 250,000 American citizens in the Philippines.
Until
November 1992, pursuant to the 1947 Military Bases Agreement,
the United States maintained and operated major facilities at
Clark Air Base, Subic Bay Naval Complex, and several small subsidiary
installations in the Philippines. In August 1991, negotiators
from the two countries reached agreement on a draft treaty providing
for use of Subic Bay Naval Base by U.S. forces for 10 years. The
draft treaty did not include use of Clark Air Base, which had
been so heavily damaged by the 1991 eruption of Mt. Pinatubo that
the U.S. decided to abandon it.
In September
1991, the Philippine Senate rejected the bases treaty, and despite
further efforts to salvage the situation, the two sides could
not reach agreement. As a result, the Philippine Government informed
the U.S. on December 6, 1991, that it would have one year to complete
withdrawal. That withdrawal went smoothly and was completed ahead
of schedule, with the last U.S. forces departing on November 24,
1992. On departure, the U.S. Government turned over assets worth
more than $1.3 billion to the Philippines, including an airport
and ship-repair facility. Agencies formed by the Philippine Government
have converted the former military bases for civilian commercial
use, with Subic Bay serving as a flagship for that effort.
The post-U.S. bases era has seen U.S.-Philippine relations improved and broadened, with a prominent focus on economic and commercial ties while maintaining the importance of the security dimension. U.S. investment continues to play an important role in the Philippine economy, while a strong security relationship rests on the 1952 U.S.-Philippines Mutual Defense Treaty (MDT). In February 1998, U.S. and Philippine negotiators concluded the Visiting Forces Agreement (VFA), paving the way for increased military cooperation under the MDT. The agreement was approved by the Philippine Senate in May 1999 and entered into force on June 1, 1999. Under the VFA, the U.S. has conducted ship visits to Philippine ports and has resumed large combined military exercises with Philippine forces. Key events in the bilateral relationship include the July 4, 1996 declaration by President Ramos of Philippine-American Friendship Day in commemoration of the 50th anniversary of Philippine independence. Ramos visited the U.S. in April 1998, and then-President Estrada visited in July 2000. President Arroyo met with President Bush in an official working visit in November 2001 and made a state visit in Washington on May 19, 2003. President Bush made a state visit to the Philippines on October 18, 2003, during which he addressed a joint session of the Philippine Congress--the first American President to do so since Dwight D. Eisenhower. There are regular U.S. cabinet-level and congressional visits to the Philippines as well.
President Arroyo has repeatedly stressed the close friendship between the Philippines and the U.S. and her desire to expand bilateral ties further. Both governments seek to revitalize and strengthen their partnership by working toward greater security, prosperity, and service to Filipinos and Americans alike. Inaugurated into office on the same day as President Bush, President Arroyo lent strong support to the global war on terrorism. In October 2003, the U.S. designated the Philippines as a Major Non-NATO Ally. That same month, the Philippines joined the select group of countries to have ratified all 12 UN counterterrorism conventions.
The annual Balikatan (Shoulder-to-Shoulder) bilateral military exercises contribute directly to the Philippine armed forces' efforts to root out Abu Sayyaf and Jemaah Islamiyah terrorists and bring development to formerly terrorist-plagued areas, notably Basilan and Jolo. They include not only combined military training but also civil-military affairs and humanitarian projects. The International Military Education and Training (IMET) program is the largest in the Pacific and the third-largest in the world, and a Mutual Logistics Support Agreement (MLSA) was signed in November 2002. Similarly, law enforcement cooperation has reached new levels: U.S. and Philippine agencies have cooperated to bring charges against numerous terrorists, to implement the countries' extradition treaty, and to train thousands of Filipino law enforcement officers. There is a Senior Law Enforcement Advisor helping the Philippine National Police with its Transformation Program.
In FY 2007, the U.S. Government--working closely with the Philippine Government, civil society, the private sector, and other donors--provided $145 million in grant funds to support a more peaceful and prosperous Philippines. About 60% of economic assistance resources are targeted for Mindanao, for programs that promote economic growth, mitigate conflict, and promote peace and security. The U.S. supports programs that promote good governance at the national and local levels, improve electoral systems, promote rule of law, help address constraints to trade and investment, improve revenue collection/administration and fiscal transparency, and enhance the ability of military and civilian law enforcement agencies to maintain peace and security. Many programs across other sectors--including health, education, agricultural productivity, micro-enterprise development, and natural resource management-also support improved governance, human capital development, poverty alleviation, and/or sustainable growth. Health-related assistance programs include reproductive health, maternal and child care, tuberculosis and HIV/AIDS control, and avian flu preparedness. The U.S. also provides humanitarian assistance to internally-displaced persons in conflict-affected areas and to victims of natural disasters (including $5 million in reconstruction assistance for the typhoon-battered Bicol region in FY 2007). In 2006, the Millennium Challenge Corporation (MCC) granted $21 million to the Philippines for a two-year Threshold Program targeted at addressing corruption in revenue administration and improving the capabilities of the Office of the Ombudsman. The success of this Threshold Program contributed to the MCC awarding the Philippines Compact eligibility status in March 2008.
Nearly 400,000 Americans visit the Philippines each year. Providing government
services to U.S. and other 'citizens, therefore, constitutes an important aspect
of the bilateral relationship. Those services include veterans' affairs, social
security, and consular operations. Benefits to Filipinos from the U.S.
Department of Veterans Affairs and the Social Security Administration totaled
$297,389,415 in 2006. Many people-to-people programs exist between the U.S. and
the Philippines, including Fulbright, International Visitors, and Aquino
Fellowship exchange programs, as well as the U.S. Peace Corps.
Trade
and Investment
Two-way U.S. merchandise trade with the Philippines amounted to $17.3 billion in 2006 (U.S. Department of Commerce data). According to Philippine Government data, 14.3% of the Philippines' imports in 2007 came from the U.S., and about 17.1% of its exports were bound for America. The Philippines ranks as our 29th-largest export market and our 34th-largest supplier. Key exports to the U.S. are semiconductor devices and computer peripherals, automobile parts, electric machinery, textiles and garments, wheat and animal feeds, and coconut oil. In addition to other goods, the Philippines imports raw and semi-processed materials for the manufacture of semiconductors, electronics and electrical machinery, transport equipment, and cereals and cereal preparations.
Since the late 1980s, the Philippines has committed itself to reforms that encourage foreign investment as a basis for economic development, subject to certain guidelines and restrictions in specified areas. Under President Ramos, the Philippines expanded reforms, opening the power generation and telecommunications sectors to foreign investment, as well as securing ratification of the Uruguay Round agreement and membership in the World Trade Organization. As noted earlier, President Arroyo's administration has generally continued such reforms despite opposition from vested interests and "nationalist" blocs. A major obstacle has been and will continue to be constitutional restrictions on, among others, foreign ownership of land and public utilities, which limits maximum ownership to 40%.
Over the last two decades, the relatively closed Philippine economy has been opened significantly by foreign exchange deregulation, foreign investment and banking liberalization, tariff and market barrier reduction, and foreign entry into the retail trade sector. The Electric Power Industry Reform Act of 2001 opened opportunities for U.S. firms to participate in the power industry in the Philippines. Information and communications technologies, backroom operations such as call centers, and regional facilities or shared-service centers are likewise leading investment opportunities.
Principal U.S. Embassy Officials
Ambassador--Kristie A. Kenney
Deputy Chief of Mission--Paul W. Jones
Political Counselor--Tom Gibbons
Economic Counselor--Larry L. Memmott
Public Affairs Counselor--Lee M. McClenny
Consul General--Richard D. Haynes
The U.S. Embassy is located at 1201 Roxas Boulevard, Manila; tel. (63)(2) 528-6300; fax 522-4361; website: http://manila.usembassy.gov/. The American Business Center is located at 25/F, Ayala Life - FGU Center, 6811 Ayala Avenue, Makati City. It houses the Foreign Commercial Service: tel. (63)(2) 888-4088; fax 888-6606; website: http://manila.usembassy.gov/wwwh3012.html; and the Foreign Agricultural Service: tel. (63)(2) 887-1137; fax 887-1268; website: http://manila.usembassy.gov/wwwh3011.html.
