For decades, the Philippines has recognized Taiwan’s geographical proximity, while simultaneously holding the island country at a geopolitical distance. Yet in the past months, Manila, under the leadership of President Ferdinand Marcos Jr., has been making headlines. Specifically, as the Philippines tries to make sense of its regional environment, it is increasingly treating Taiwan as a vital puzzle piece for a peaceful and stable regional environment amid the rivalry between the United States and the People’s Republic of China (PRC).
This article argues that, contrary to claims that the Philippines is—or should be—ignoring Taiwan, the Southeast Asian state is instead reassessing its strategic calculus based on shifting power dynamics in the region. Compared to previous incarnations, Manila’s latest National Security Policy (NSP) 2023-2028, released this August, provides a clear-eyed approach to the regional environment and what to do about it. The policy document states that while the West Philippine Sea remains the country’s primary concern, cross-Strait relations are a “major concern.” A potential Taiwan Strait contingency could have dire consequences—both in terms of broader economic stability, as well as for the welfare of the significant overseas Filipino population in Taiwan. It could also result in an influx of refugees due to Taiwan’s geographic proximity to the Philippines.
The Taiwan-Philippines Relationship Thus Far
At the height of the Cold War, the Philippines and the Republic of China (ROC) were de facto allies in the US-led global anti-communist campaign. But, following the adoption of a new “One-China Policy” under Ferdinand Marcos Sr.’s presidency, Manila switched its diplomatic relations from the ROC to the PRC in 1975. Since then, both countries have had unofficial relations through the Manila Economic and Cultural Office (MECO) based in Taipei, and the Taipei Economic and Cultural Office (TECO) based in Manila.
Despite the “One-China Policy,” it makes sense for the Philippines to be proactive vis-à-vis Taiwan due to the geo-economic potential that the relationship might have. Through their unofficial ties, the Philippines and Taiwan reap mutual benefits. According to Dr. Kristy Hsu (徐遵慈), overseas Filipino workers are considered a major source of manpower for Taiwan’s electronics industry. In turn, these workers are a major source of remittances for the Philippines. As of May 2023, there are about 160,000 overseas Filipinos in Taiwan, with up to 28,000 more expected by the end of 2023. As of this year, Taiwan is the Philippines’ ninth-largest trading partner, amounting to USD $2.96 billion in total exports.
In terms of soft power, Filipinos loved the 2004 Taiwanese TV drama Meteor Garden (流星花園), creating the so-called “meteor fever” fandom in Manila. Even today, many Filipino millennials are still nostalgic about it. As splendidly put by Yi-Yu Lai, “the image of Taiwan in the Philippines has shifted from romantic fiction, the medium of Chinese cultures, to a neighboring country that exists.” The Philippines also has extensive people-to-people ties with Taiwan, thanks largely to Taiwan’s New Southbound Policy (NSP, 新南向政策). These include sister city agreements, university exchanges and alliances, and religious-humanitarian ties, which present deeper collaboration and exchange. In terms of tourism, Filipino tourists have already exceeded pre-pandemic levels, with about 60,723 arrivals during the first quarter of 2023, which is 50 percent higher compared to the first quarter of 2019.
Of course, there are also gaps. Despite Taiwan’s NSP, launched in 2016, Taipei has noted that Taiwanese investment in the Philippines remains relatively low compared to other Southeast Asian countries. In May 2023, the Philippine government pitched to Taiwanese companies—particularly from the electronic vehicle, agro-processing, medical technology, and pharmaceutical sectors—the perks of investing in the country, especially its “highly trainable and skilled workforce.” MECO Chief Silvestre Bello III argued that securing a memorandum of understanding (MOU) to ease the tax burden on Taiwanese companies would encourage more investments in the Philippines.
Image: The “10 Dash Line” map issued by the PRC in summer 2023, which asserts PRC sovereignty over Taiwan and virtually the entire South China Sea. (Image source: Manila Standard)
Now We’re Here
There is no doubt that the Philippines has geoeconomic interests in Taiwan. If anything, the strong ties between the two nations suggest that the Philippines is not entirely evading its regional neighbor at all. Geopolitically, Manila is evolving its strategic calculus, working to adapt to the shifting regional power balance.
While cross-Strait crises are nothing new, the so-called Fourth Strait Crisis, kicked off by former US House Speaker Nancy Pelosi’s visit to Taiwan last year, was an impetus for the Philippines to become more proactive on the regional scene. The Philippine Department of Foreign Affairs called for restraint following Pelosi’s visit. According to a Filipino analyst, it is in the Philippines’ interest to maintain the status quo in the Taiwan Strait so that Manila can keep Beijing limited to a “strategic buffer” in the First Island Chain (FIC). While ideal, this option seems more unworkable by the day. The “1992 Consensus” (九二共識), which has shaped cross-Strait relations for decades, is no longer working due to the PRC’s relentless drive for maritime domination and Taiwan’s growing domestic distaste for strong PRC ties.
The 2022 crisis also played a significant role in the expansion of the 2014 US-Philippines Enhanced Defense Cooperation Agreement (EDCA). According to Marcos Jr., the expanded EDCA would reinforce the Armed Forces of the Philippines’ (AFP) capability for humanitarian assistance and disaster response.
The EDCA expansion was met with opposition from figures including former President Rodrigo Duterte, Senator Imee Marcos, and Cagayan Governor Manuel Mamba, among others. Reasons for their opposition largely fell along two lines: that the Philippines should not be dragged into a war for Taiwan as a US proxy; and that the Philippines should drop maritime grievances in exchange for better economic ties with China.
During the Senate inquiry, Imee Marcos questioned her brother’s decision over the expanded EDCA. Specifically, she drew attention to the fact that three of the bases included in the expansion are located in northern Luzon—one in Isabela province and two in Cagayan. All three are in close proximity to Taiwan, suggesting that they were chosen in anticipation of a potential Taiwan Strait contingency. At the same time, Chinese Ambassador to Manila Huang Xilian (黄溪连) went as far as to accuse the Philippines of interfering in what it considers an internal matter, and threatened the government that it should not do so if it cared for its overseas Filipinos residing in Taiwan. Marcos Jr. brushed all concerns aside, with his Defense Secretary Gilberto Teodoro Jr. emphasizing that the Philippines has the right to modernize the AFP and intensify its alliances without influence from other nations.
Not-So-Post-Script: The PRC’s Ten-Dash Line
Some scholars are somewhat concerned about the Taiwan factor in the EDCA expansion. For instance, one argued that the EDCA should only focus on the South China Sea struggle with the PRC, while another argued for the Philippines to leave Taiwan matters alone as a symbol of its “strategic autonomy” from “great power rivalry.”
However, these views are unlikely to stand the test of time. Beijing shocked the international community on August 28 this year when its Ministry of Natural Resources released the country’s “new standard map,” which delineates a “10-Dash Line” encompassing the entire South China Sea, including the island of Taiwan and its western seaboard. Countries such as India, Nepal, Malaysia, Taiwan, and the Philippines were quick to issue a diplomatic protest against this latest development.
The PRC’s 10-Dash Line is doing the Philippines a big favor by helping to align it with regional allies and partners. It also easily justifies the EDCA expansion. In May 2023, the Philippines hosted the largest Balikatan joint training exercises yet. Notably, the drills focused on a potential Taiwan scenario. This was further cemented by a report that the US military is in talks to develop a civilian port in the Batanes islands, less than 200 kilometers from Taiwan. Should the PRC take Taiwan successfully, Beijing may likely stage its intimation and invasion of the Philippines much easier, as the Japanese Imperial Military did in the past.
Marcos Jr. indicated in a recent interview that his government will promptly respond to the 10-Dash Line. Ultimately, the PRC map provides a rationale for the Philippines to establish more operational, albeit still unofficial, ties with Taiwan, particularly on the maritime and economic fronts.
In an exclusive interview with The Philippine Star this year, Taiwanese Foreign Minister Joseph Wu (吳釗燮) acknowledged that the Philippines’ is his country’s closest neighbor, and expressed the ROC government’s support for Manila and Washington’s decision to expand EDCA. In Wu’s words, “as long as there’s a desire on the part of the Philippines, Taiwan will be there to work together with the Philippines” on security issues, particularly coast guard cooperation.
For that to happen, the Democratic Progressive Party (DPP, 民主進步黨)—should it win in the 2024 election—must clarify Taipei’s position on the Philippines’ hard-won 2016 Arbitral Ruling to nullify PRC’s excessive claims, since it is arguably now part of customary international law. Back in 2016, Taipei, under Kuomintang (KMT, 中國國民黨) rule, rejected the said ruling over issues regarding the status of Taiwan-occupied Itu Aba island in the South China Sea.
Wu said in the interview that Taiwan’s policy on the ruling remained unchanged, and that Taiwan will continue to adhere to the status quo. However, the status quo is now changing due to the PRC’s repudiation of international norms. Manila and Taipei, therefore, must engage in serious, yet unofficial, contacts to talk about this. The South China Sea and the Taiwan Strait cannot be treated as separate cases any longer, as both are part of the PRC’s relentless drive for regional dominance in the FIC.
Another critical goal should be to strengthen the resiliency of both Taiwan and the Philippines against China’s economic coercion. The United States has a critical role in this. Notably, Washington’s weakness in regional outreach lies in economics. While military assistance is its niche, the United States must intensify its efforts to fill the gaps in the Indo-Pacific Economic Framework (IPEF). Therefore, Taipei and Manila must also engage in serious diplomacy to make this happen.
At the end of the day, the Philippines is concerned with Taiwan geopolitically because of its geoeconomic concerns, as the recent NSP highlighted. Taiwan and the United States would do well to recalculate their economic statecraft, not only to build resiliency against the PRC, but also to develop a stronger, more mutually beneficial relationship and build an inclusive, rules-based international order.
The main point: For decades, the Philippines has affirmed Taiwan’s geographical proximity, while remaining geopolitically distant. However, Manila’s latest National Security Policy demonstrates that its strategic calculus toward Taipei is evolving, potentially providing an opportunity for expanded Philippines-Taiwan ties.