The shared vision of the Philippines and Japan

Trade and cultural exchanges between the Philippines and Japan have a rich history that dates back to the pre-colonial period. Historical records reveal that Japanese merchants traded goods such as pottery, silk, and other valuable items with Filipinos, who reciprocated by exporting products like pearls, gold, and hardwood.

The relationship between the two countries was severely damaged when Japan occupied the Philippines during World War II, but since then, both countries worked to rebuild their relationship.

In 1951, the Philippines signed the San Francisco Peace Treaty, also known as the Treaty of Peace with Japan, to legally resolve the issues between Japan and the Philippines with regard to reparations, material restitution, and the right to claim for war damage.

Strengthening bilateral relations

Japan and the Philippines share common goals of promoting peace and economic stability in the Asia-Pacific region, which has become increasingly important given the rising assertiveness of China.

In 2011, the Philippines and Japan agreed to increase consultations and exercises between their coast guards and navies, resulting in the signing of a strategic partnership pact a year later to strengthen the Philippines’ maritime security.

Recently in 2021, Japan’s Air Self-Defense Force conducted its first bilateral exercise with the Philippines, using a single C-130 transport aircraft. The two countries are also in talks about a potential Visiting Forces Agreement and a reciprocal access agreement. These agreements would permit the rotation of Japanese ground troops through the Philippines for training exercises.

This relationship also boosts the economic development of both nations. The Philippines-Japan Economic Partnership Agreement (PJEPA), which has established a framework for trade, investment, and labor mobility between the two countries, was signed on Sept. 9, 2006, and entering into force on Dec. 11, 2008. This is the first bilateral free-trade agreement of the Philippines.

During President Ferdinand R. Marcos, Jr.’s visit to Japan in February 2023, the Philippines secured over $13 billion worth of agreements and pledges from the Japanese government and business leaders. These commitments are expected to generate around 24,000 direct jobs and boost the purchasing power of Filipinos in the medium term.

Last April, the leaders of Japan, the Philippines, and the United States met for the first trilateral summit. They launched the Luzon Economic Corridor, a partnership for global infrastructure and investment that will support connectivity between key economic hubs in the Philippines. The three countries also committed to accelerating investments in high-impact projects, including rail, port modernization, clean energy, and semiconductor supply chains.

Filipino and Japanese lawmakers also renewed their commitment to enhancing relations back in June, focusing on cooperation that opens opportunities for both nations. The initiative aims to foster closer ties through legislative exchanges and mutual support in various sectors, including economic growth and security cooperation.

As recently as this month, the two countries signed a significant Reciprocal Access Agreement (RAA), allowing the mutual deployment of military troops in each other’s countries, amid rising tensions with China. The agreement, which awaits parliamentary ratification, aims to facilitate military cooperation and disaster response.

According to the Foreign Policy Research Institute, the growing security partnerships between the Philippines and Japan are significant for several reasons, as both countries are archipelagic nations that have experienced increasing security pressure, aiming to bolster deterrence in the Western Pacific and safeguard their maritime interests.

Moreover, the partnership is seen as a natural extension of the two countries’ long-standing alliances with the United States. Hence, it has been welcomed by the US, which views it as a positive development in the region.

Reports also showed the recent partnerships of the Philippines and Japan have entered what is often referred to as a “golden age,” reflecting the deepening of their strategic and economic connections.

Security partnerships

Japan and the Philippines have taken significant steps to deepen their ties and bolster maritime security in the region.

Amid China’s growing maritime assertiveness in the West Philippine Sea, the two countries have rapidly upgraded their security cooperation, with Japan providing military aid to enhance the Philippines’ maritime security capabilities. The Philippines, on the other hand, has been a vocal supporter of Japan’s growing security role in the region, seeing it as a counterbalance to China.

Japan announced its donation of 10 ships valued at US$11 million to the Philippine Coast Guard in 2013. This aid was believed to be a diplomatic message to China.

In 2016, the Philippines entered into a Defense Equipment and Technology Transfer Agreement with Japan, allowing Tokyo to provide defense equipment to Manila. This included the construction and delivery of 10 44-meter Parola-class patrol boats for the Philippine Coast Guard between 2016 and 2018.

Japan also transferred excess defense equipment to the Philippines, including three retired TC-90 trainer aircraft from the Japan Maritime Self-Defense Force in 2017. The countries resolved a similar situation involving the transfer of excess spare parts from Japan’s Ground Self-Defense Force to restore seven UH-1 utility helicopters for the Philippines.

Since then, Japan and the Philippines have conducted regular coast guard and naval exercises, focusing on anti-piracy drills and addressing “unplanned encounters at sea.” Japanese warships have frequently visited the Philippines, and the Philippines has allowed Japanese military aircraft to refuel in the country since the mid-2010s.

A strong economic relationship

Japan’s post-war reconstruction was supported by the Philippines, and in return, Japan has become a vital partner in the Philippines’ economic development.

According to the Department of Trade and Industry, overall trade between the two countries increased by 19%, rising from $115.99 billion to $137.96 billion. By 2019, Japan had solidified its position as the Philippines’ second-largest trading partner, with total trade amounting to $21.38 billion

In terms of investments, there was a significant increase in approved investments from Japan, surging 146.7% from $260.81 million before the PJEPA to $438.64 million after PJEPA.

Japan’s Official Development Assistance and private sector investment exceeded the pledge of ¥600 billion made in the 2023 Japan-Philippines Joint Statement.

Japan is also currently the biggest investor in the Philippine Economic Zone Authority (PEZA), contributing to 28% of total investments, which resulted in P798 billion, $16.3 billion in exports, and the creation of 342,845 direct jobs across 877 PEZA-registered business enterprises.

Meanwhile, the Philippine government and the Japan International Cooperation Agency (JICA) signed a $2-billion loan agreement to construct a railway system between the Tutuban railway station in Manila and Malolos, Bulacan. This project is set to become the country’s largest railway system. — Mhicole A. Moral