How beneficial is VFA to the Philippines in numbers?

Foreign Secretary Teodoro Boy Locsin, Jr. had to let the president know what we are going to lose if we as a nation proceed with the termination of the Visiting Forces Agreement with the United States.

With the Armed Forces of the Philippines (AFP) who have been neglected in years would have the biggest impact when the VFA is terminated.

Locsin likened the situation if we are going to terminate the VFA and  Enhanced Defense Cooperation Agreement (EDCA) with the Mutual Defense Treaty (MDT) "To put it more graphically, the MDT without the VFA and EDCA is like a balloon without air.

One of the Balikatan exercises between the US and PH troops
(photo credit to owner)

FOREIGN MILITARY FINANCING AND PROCUREMENT OF DEFENSE EQUIPMENT

2016 to 2019

-$267.75 million (P13.58 billion) 

2020 to 2021

- $200 million (P10.14 billion) for aircraft, training, equipment and construction for the Armed Forces of the Philippines
- $45 million (P2.2 billion) in foreign military financing

"The Philippines is able to receive after-sales servicing in the form of maintenance packages that increase the articles' value and lifespan," Locsin said.

Some 319 activities designed to "enhance" Filipino troops' capabilities "in countering threats to national security" were also slated in 2020 alone, he said.

SUPPORT VS 'NON-TRADITIONAL SECURITY THREATS'

Development assistance

- $336.30 million (P17.05 billion) for scholarships, seminars, projects on health, environment, agriculture, fisheries, trade, labor and governance

Locsin said US assistance support projects against human trafficking, cyberattacks and narcotics, and help fund disaster response and intelligence and capability-building. 

"Without the VFA, the US Departments of State and Defense may have difficulty in requesting funds from the US Congress for FMF (foreign military financing) and other defense assistance programs to the Philippines."

'INDIRECT BENEFITS'

Close relations between Manila and Washington have also resulted in economic benefits as the US is inclined to give "preferential treatment" to its traditional allies, Locsin said.

The US is the Philippines' "largest source of grants," accounting for 36.89 percent of the total grant aid the country received in 2018.

These grants amount to $886.47 million (P44.96 billion), according to Locsin.

The US is also the Philippines' 3rd largest trading partner, biggest export market and 4th largest import source with some $18.70 billion (P948 million) worth of goods traded in 2018.

It is also the country's 3rd largest tourism market, next to South Korea and China, with 1 million American tourists visiting the Philippines in 2018.

The world's largest economy is also the Philippines' 5th largest source of investments, with American investments amounting to P12.9 billion in 2018.

"While the Philippines has the prerogative to terminate the VFA anytime, the continuance of the Agreement is deemed to be more beneficial to the Philippines compared to any benefits were it to be terminated," Locsin explains.

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Report from ABS-CBN News

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