Philippines eyes $500 million “no strings” loan to buy Chinese weapons

Philippines eyes 0 million "no strings" loan to buy Chinese weapons
President Duterte meets the Chinese premier in Beijing last october

The Philippines is considering an offer of a $500 million loan to buy Chinese weapons — saying similar deals with the USA come with too many conditions.

Defence Secretary Delfin Lorenzana raised the issue on the sidelines of the Belt and Road Forum in Beijing. He is there to sign a letter of intent with Chinese state-owned arms company Poly Technologies.


He said: “We are not saying that we will buy from them or we will not buy from them, but if we need anything from the Chinese defence industry, we are going to procure using the loan that they are going to offer to us.”

China offered the $500 million loan and donated $14 million worth of small arms and speed boats to the Philippines in December.

Lorenzana said his country would use the offered loan if its military budget is insufficient for a planned modernisation programme. The country plans to spend some $2 billion over five years on defence upgrades.


Since 1950, about three quarters of its arms imports have come from America.

However, President Duterte has made it clear that he wants to distance the Philippines from its traditional ally and compensate by turning to China and Russia instead.

Lorenzana said acquiring weapons and equipment from the US had become difficult. He said the process of approving arms contracts with American suppliers is slow and that there are conditions tied to sales.

The trade is also complicated by concerns in the US over weapons being used in the president’s war on drugs.

“That’s why we are discouraged from getting from them because of these conditions,” Lorenzana said.

“We need airplanes, we need drones, we need fast boats. We need them in the south so that we can deter kidnappings and bring about development.”

In 2013, the US accused Poly Technologies of producing weapons of mass destruction. The company denied any wrongdoing, saying it neither sold banned weapons nor violated any UN Security Council resolutions.

Lorenzana is due to sign a defence agreement with his Russian counterpart Sergey Shoigu next week.