(April 17): The US said it plans to help build a first-of-its-kind industrial hub in the Philippines to boost production of inputs crucial to American supply chains.
The 4,000-acre hub is intended to be “a purpose-built platform for allied manufacturing” and “an investment acceleration hub where the specific industrial activities are shaped by market demand”, according to a State Department statement on Thursday.
The project — touted as an “economic security zone” — will be located within the Luzon Economic Corridor, a flagship economic project backed by the US and Japan on the main Philippine island.
The project was also described as “the first AI-native industrial acceleration hub” under the Pax Silica Initiative, a Washington-led supply-chain alliance that also includes Australia, India, Israel, Japan, and the UK. The Philippines became the 13th country to join the grouping under the State Department’s flagship effort on artificial intelligence and supply chain security.
The hub is yet another step to deepen economic ties between the US and the Philippines, as the treaty allies also strengthen their military relationship. It is also a win for Philippine President Ferdinand Marcos Jr who has sought to capitalise on his country’s long-standing defence alliance with the US to secure more investments.
Marcos has bolstered security ties with Washington, allowing US troops to access more Philippine bases and deploy advanced weapons amid Manila’s territorial dispute with Beijing over the South China Sea. At the same time, the US has helped Manila woo American investors and extended funding for a railway project.
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The planned industrial economic zone “can leverage the Philippines’ geographic centrality in the Indo-Pacific, its young and technically skilled workforce, and its deepening alliance with the United States”, according to the State Department.
The Philippines holds significant reserves of nickel, copper, chromite and cobalt, which are increasingly vital to global supply chains, it added. Manila and Washington earlier signed a pact to boost cooperation on critical minerals.
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