U.S.-Philippine Relations: What’s the Real Score?

Written by Dan Napa

On June 21, 2017, during it’s Trade and Investment Committee Meeting, the American Chamber of Commerce of the Philippines invited United States Counselor for Economic Affairs David M. Schnier to discuss the current state of U.S.-Philippine relations and economic policies, highlighting the roles of both nations’ colorful leaders.

As they trickled in, attendees took the opportunity to network over chips and sandwiches. Once the room was full, Mario Biscocho, head of the Trade and Investment Committee, commenced the meeting by delivering a comical introduction of David Schnier, to which he playfully responded. David began his talk by saying that he would like to keep the session more spontaneous and candid by having a dialogue, rather than a strict lecture.

Getting to the matter at hand, Mr. Schnier explained that the United States is committed to keeping its relationship with the Philippines, despite the noise in the media. He stated that the United States has a strategic interest in keeping a good relationship with the Philippines. The Philippines has been a key geographical partner in Asia — with its location right next to the Pacific Ocean and being a natural jump-off point to Taiwan, Hong Kong, Malaysia, Singapore, China, etc. Regardless of the leadership, both in the U.S. and in the Philippines, the partnership is something that cannot be easily replaced.

David shared key areas the U.S. Embassy and the Philippine Government had been working on to reinforce ties between the two countries —the first is security. Since World War 2, the U.S. kept close ties with the Philippines due to its strategic location. In 1951, the two countries signed a mutual defense treaty, which stated that both nations would support each other if either the Philippines or the United States were to be attacked by an external party. Moreover, The EDCA (Enhanced Defense Cooperation Agreement) assures that U.S. forces will only enter Philippine soil upon the explicit invitation of the Philippine government, a timely example of which would be the deployment of U.S. forces to assist in the conflict between the Philippine Forces and the Maute Group in Marawi.

The second key area is trade and investment. Currently, the United States ranks fourth in Foreign Direct Investments (US$ 5 billion) in the Philippines. To further strengthen its partnership with our government, the U.S. has also pledged to increase its spending for infrastructure and get in on the bidding with China for the numerous projects in the Duterte Administration’s Build! Build! Build! campaign. In addition to this, the U.S. Government, via the MCC, will be injecting US$ 400 million into the agriculture modernization program, with an emphasis on farm to market infrastructure, making the transport of goods easier and cheaper for impoverished farmers.

Third on David’s list was economic ties. Currently, the United States and the Philippines are engaged in bilateral talks to discuss how to make the Philippines an economic powerhouse through changes in the business environment. The ASEAN Single Window is one of the improvements that have drastically sped up the process of customs. Investment liberalization also aims to loosen restrictions in foreign ownership of businesses, as well as trade facilitation for various goods and services entering the Philippines. In addition, the U.S. Embassy is also helping improve the Anti-Money Laundering system in the Philippines.

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About the author:

Dan is currently a supervising sales consultant at the Executive Search and Selection division of John Clements Consultants, Inc.