Envoy says move shows strong alliance remains intact

The United States has exempted $336 million for the modernization of Philippine security forces in its foreign aid freeze, Philippine Ambassador to the US Jose Manuel Romualdez said on Monday.

“We are pleased with this development – another significant sign that our strong partnership and alliance with the United States remains intact,” Romualdez said.

The Department of Foreign Affairs likewise confirmed Washington has exempted its security aid to Manila from its pause on global foreign aid.

DFA spokesperson Ma. Teresita Daza said the US issued a waiver to a “portion” of its foreign military financing for the Philippines.

“Both countries are committed to the treaty alliance and to efforts to further strengthen our defense cooperation and interoperability,” Daza said.

“We will continue to engage the US government on the importance of our bilateral work in supporting our shared goals and priorities,” she added.

Last year, former US Defense Secretary Lloyd Austin III and State Secretary Antony Blinken announced the grant of assistance worth $500 million for the modernization of the Armed Forces of the Philippines and the Philippine Coast Guard.

Romualdez said the $336 million is part of the $500 million foreign military financing approved under the Biden administration.

In January, the US State Department issued a stop-work order for all existing foreign assistance and paused new aid after President Donald Trump ordered a 90-day pause pending a review.

Washington also placed the staff of the US Agency for International Development (USAID) on administrative leave.

The Trump administration eventually released $5.3 billion in previously frozen foreign aid, mostly for security and counternarcotics programs.

A Reuters report showed the vast majority of released funds — more than $4.1 billion — were for programs administered by the US State Department’s Bureau of Political-Military affairs, which oversees arms sales and military assistance to other countries and groups.

Other exemptions were in line with Trump’s immigration crackdown and efforts to halt the flow of illicit narcotics into the US.

Earlier, the National Economic and Development Authority said the Trump administration’s 90-day freeze on foreign aid would have minimal direct impact on the Philippine economy.

“The US is our number one source of grants, but these account for a small portion of the overall economy,” Socioeconomic Secretary Arsenio Balisacan said.

He said that current flagship infrastructure projects remain unaffected, as they are largely funded by Japan, Korea, the Asian Development Bank, and the World Bank.

Balisacan noted, however, that an aid freeze could have indirect effects due to the US being a major shareholder in global lending institutions like the World Bank and ADB.

“If lending facilities for official development assistance are affected, it could impact the medium-term prospects,” he said.

Editor’s Note: This is an updated article. Originally posted with the headline “DFA confirms US military aid to PH exempted from Trump’s funding freeze.”