PHILIPPINES Becoming an Investment Hub in Asia Pacific | $100 Billion Investment from Japan and US

The Philippines is all set to become the leading investment destination in Asia. With a solid reform agenda and unabating growth amid headwinds, the Philippines is ready to take off as a leading investment hub.
The country is eyeing around $100 billion in investment deals in the next five to 10 years from the country's trilateral summit with the United States and Japan, these would cover a range of different sectors including energy, semiconductors, infrastructure and digital economy.
The first-ever trilateral summit among US President Joseph Robinette Biden Jr., Philippine President Ferdinand R. Marcos, Jr., and Japanese Prime Minister Fumio Kishida scheduled to take place on April 11 comes on the heels of increasing tensions in the South China Sea, which China claims almost in its entirety.
The US and Japan have been at the forefront of international condemnation of Chinese ships’ harassment of Philippine vessels deployed for resupply and rotation missions within Manila’s exclusive economic zone.
This is the first time that the three countries — Japan, the Philippines, and the United States — going together to enhance economic cooperation, aside from its military cooperation in Asia Pacific.
The US gross domestic product (GDP) hit $27.3 trillion last year, while Japan’s was $4.2 trillion, two of the world most developed economy. The Philippines, meanwhile, is still in transition to become an upper middle-income country by 2026 with a 21.05-trillion pesos economy last year. In the other hand, China’s GDP, the Philippines’ second-largest export market, and largest source of imports, hit $17.5 trillion in 2023.
Tokyo has been the nation’s most reliable development partner, with its massive development commitments in improving the Philippines railway infrastructure such as the Metro Manila Subway and the North South Commuter Railway Project. The huge two infrastructure project alone, cost more than $25 Billion which more than 80% will be financed by Japan.
On the other hand, Washington has remained committed to expanding its investments in the semiconductor and IT-BPO sector, both of which have been massive drivers of year-on-year growth. The sector contributes more than 10% to the country’s economy last year.
Another potential US investment into the country from Seattle-based Ultra Safe Nuclear Corporation will be the potential development of the small modular nuclear power plants in the Philippines. As the United States is keen to develop the country’s energy sector.
The envoy said a joint exploration within the Philippine exclusive economic zone in the South China Sea is also expected as Philippine companies that have been given concessions in the area have been seeking potential partners in the US for a joint venture in the exploration of energy sources.
Electricity costs in the Philippines are not only threatened by movements in the global energy markets but also by the expected depletion of the Southeast Asian nation’s only indigenous source of natural gas. The Malampaya gas field, which accounts for at least 40% of electricity needs in the Philippine capital region, is projected to run dry by 2027 with expected serious repercussions for the economy.
Philippine energy and semiconductor sectors are expected to heavily benefit from the $100-billion investments that the Philippines is expected to gain in the coming years. There is an opportunity for the Philippines to attract investments, particularly from US and Japanese firms, that might leave China in the wake of the political tension in the West Philippine Sea.
Philippines’ increasing bond with the US and Japan could significantly boost Manila’s positioning as an investment destination. The United State is pursuing an industrial policy of friendshoring semiconductors, digital trade, and industries transition into green energy.
Philippines can achieve a huge percentage of investment by just by getting a share in the US semiconductor industry, which is said to be worth $80 billion just in the Asean region. The semiconductor industry is going to be the wave of the future in terms of the technology that’s going to be required for anything, from cars to defense equipment and digital infrastructures.
Indeed, the Philippines today is primed more than ever to become a leading locus of investments in Asia and the Pacific. This is made possible through the establishment of a stable, predictable, and competitive investment environment.


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