Philippines Proposes Lifting Financing Caps for AFP Modernization Program
The Philippines' Department of National Defense seeks to remove restrictions on foreign and local financing for defense acquisitions. The proposal includes lifting the $300 million cap on foreign loans and eliminating the 15-year limit on the Armed Forces of the Philippines' modernization timeline. The DND argues that these changes are necessary to enhance defense capabilities amid evolving operational needs. The country has allocated approximately $35 billion for military upgrades over the next decade.

The Philippines' Department of National Defense (DND) is advocating for the removal of the $300 million cap on foreign loans and the 15-year limit on the Armed Forces of the Philippines' (AFP) modernization program. Defense Assistant Secretary Erik Dy stated that current financing restrictions hinder the acquisition of high-cost defense systems.
The DND wants to shift towards needs-based acquisitions rather than fixed timelines. The Philippine military's modernization, initiated in 2012, has a budget of about $35 billion over the next decade. Recent reports indicate a continued Chinese presence in the disputed Scarborough Shoal, although no new land reclamation activities have been observed.




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