DoF may secure loans for military modernization – BusinessWorld Online
THE Philippines’ Finance department is authorized to secure loans for modernizing the Southeast Asian nation’s armed forces, a congressman said on Sunday, a move that may give military planners fresh funding sources to sustain the buildup.
Lawmakers have authorized the Finance department chief to enter into loan agreements to fund the Philippines’ military modernization under the 2026 budget law, a power not previously allowed, House Minority Leader and Party-list Rep. Marcelino C. Libanan said.
“This special provision gives the national government greater flexibility to finance critical modernization projects in a timely and cost-effective manner,” he said in a statement. “Access to a mix of financing options — such as concessional loans, grants, or blended facilities — can significantly reduce costs and speed up project delivery.”
The Philippines is at the tail-end of its military modernization program called “Horizon,” which began in 2012 when tensions with China flared after a naval standoff at Scarborough Shoal in the South China Sea. Manila has earmarked about $35 billion for military upgrades in the next decade.
Mr. Libanan said the 2026 budget law allows the Finance department to “negotiate, contract, and enter into foreign and domestic financing arrangements, including but not limited to loans, grants, credit facilities, and blended financing mechanisms” for the military modernization program.
Any funding schemes need to have President Ferdinand R. Marcos, Jr. and the Monetary Board’s approval, he added. — Kenneth Christiane L. Basilio