The shift in Philippine-China relations under President Rodrigo Duterte has resulted in numerous bilateral cooperation agreements and billions (in USD) worth of projects backed by Chinese funding. One of the major components in this rapprochement is the Philippines’ participation in China’s Belt and Road Initiative (BRI).
This particular development is expected to boost the country’s “Build Build Build” (BBB) program, which aims to address the perennial issues of poverty, economic growth, and industrial development by increasing public spending on infrastructure, as the influx of Chinese investments will provide the necessary financial support for such an expansive domestic infrastructure project. However, observers have raised concerns on the implications of being heavily indebted to China. Much of the speculations involve the Philippines falling into a “debt trap” or a “debt-for-equity” scenario. That similar cases have occurred in Sri Lanka and in Ecuador further validate the need for a risk assessment to avoid the likelihood of the Philippines from suffering the same fate.
This policy brief looks into the challenges and opportunities of the BRI for the Philippines. The following sections provide an overview of the framework within a domestic context and discuss what considerations for policymaking can be made to maximize the possible gains of the Philippines from its participation in the BRI.