24 Juli 2015
The Philippines is set to develop a Defence Economic Zone that will soon house the best international weapons manufacturers, with profits going straight back into the armed forces' modernisation fund. (photo : ChannelNewsAsia)
BATAAN: The Philippines is set to develop a 370-hectare Defence Economic Zone - one that will allow international manufacturers to set up in the country to help it become self-sufficient in defence requirements.
Aside from welcoming these companies, the Philippines will also be able to benefit from enhanced manufacturing capabilities as part of the Armed Forces of the Philippines modernisation programme.
General Arsenal, a unit under the Department of Defence which is tasked with manufacturing weapons and ammunitions, will serve as administrator of the economic zone.
All profits made from the facility will go straight back into the armed forces' modernisation fund, which will be used to develop new local manufacturing facilities and technology.
The aim, according to Jonathan Martir, director of General Arsenal, is for the country to become self-sufficient in terms of ammunition and weapons by 2017.
A number of ammunition companies from South Korea, South Africa and the United States have already expressed their interest in setting up manufacturing facilities to take advantage of the strategic location and tax breaks the zone would offer.
"Some manufactures see us as a hub,” said Martir. “We will manufacture their goods in the Philippines rather than so far away in South Africa. The Philippines is in a perfect political position, some manufacturers see that as well."
Currently, the Philippines only manufactures ammunition and some small-calibre weapons.
During his leadership, President Ferdinand Marcos launched a self-reliance defence programme, where the country manufactured its own M16s as well as jeeps and tactical radios. However, with little funding, defence technology and manufacturing capability were lost over time.
To upgrade and modernise the armed forces, President Benigno Aquino has embarked on a five-year programme totalling US$1.68 billion, equivalent to 75 billion pesos. The plan will see annual defence procurement rising from US$273 million this year to US$500 million in 2021.
The modernisation effort comes at a time when tensions continue to rise between the Philippines and China over disputed territory in the South China Sea.
According to government officials, humanitarian assistance and disaster response and the security of the West Philippine Sea will be the focus for this year's procurements, while internal security operations will take a back seat.