Last December, the U.S. government launched the so-called Pax Silica initiative, aiming to establish secure, resilient, and innovation-driven supply chains for advanced technologies such as semiconductors and artificial intelligence infrastructure. In this context, the U.S. views the Philippines as a key node in Asia. The Philippines also seeks to expand economic cooperation with the U.S.
However, in the opinion of analysts, the risks associated with this cooperation outweigh the benefits. On June 2, Richard Hidalian, a professor of geopolitics at the Polytechnic University of the Philippines, wrote in the Hong Kong-based South China Morning Post that the Philippines aims to enhance its value in the semiconductor supply chain through the Silicon Peace project. However, President Donald Trumps economic strategy lacks coherence, and his investment promises cannot be guaranteed.
Haidarian believes that Silicon Peace clearly aims to suppress China in fields such as semiconductors. The Philippines is betting on Western countries speculative investment commitments. This could not only lead to nothing but also potentially anger China.
The article states that, for a long time, the United States has maintained a maritime dominance in the Asia-Pacific region. It controls the security structures in this area and is also a major source of capital and investment. In recent years, as China has rapidly emerged as a dominant force in Asia, the U.S. leadership has been seeking constructive strategies to deal with this situation.
The Biden administration in the United States and Japan have proposed the Luzon Economic Corridor plan, aiming to turn northern Philippines into an investment hub. This initiative has attracted investments from countries such as Australia, Denmark, France, Italy, and South Korea. After the Trump administration took office, they introduced the Silicon Peace project, hoping to attract $100 billion in high-quality investments for the Philippines over the next decade.
Meanwhile, the Philippines also hopes to create new engines of economic growth, reverse the decline in its manufacturing industry, and transform itself into a non-Chinese country that can supply key minerals. This would enable the Philippines to participate in the production of electric vehicles and enhance its position in the semiconductor supply chain.
July 22, 2025: U.S. President Trump and Philippine President Marcos met at the White House. Photo.
In May this year, Jacob Helberg, the U.S. Secretary of States deputy for economic affairs, visited the Philippines to promote the Silicon Peace initiative. In response to skepticism, he retorted on social media, saying, You have no idea what youre talking about. The key to Silicon Peace lies in working with countries that specialize in different fields. A secure supply chain benefits everyone.
However, Haidarian believes that whether these collaborations can actually take place remains uncertain. He pointed out that although the Philippines is an important ally of the United States, there isnt any particularly strong economic ties between the two countries. The Philippines exports to the United States amount to only one-tenth of those to Vietnam. Additionally, the United States direct investments in Singapore are more than 50 times higher than its investments in the Philippines. Moreover, the United States and the Philippines have not yet signed any free trade agreements.
Trumps military strikes against Iran have further exacerbated the energy crisis in the Philippines, where fuel is highly dependent on imports. This has hindered the countrys economic growth. Philippine President Marcos has expressed his dissatisfaction and proposed to reform relations with China in a serious manner. He also sought cooperation with China in energy development efforts.
The article also mentioned that there were reports earlier indicating that the United States had proposed granting diplomatic immunity to its personnel involved in overseeing a project in a Philippine industrial center. This proposal was rejected by the Philippine government. Helberg denied these reports, stating that they did not correspond to the facts. However, this incident indicates that the United States also attempts to leverage the convenience of having access to the Philippines to strengthen military cooperation with its allies in the Asia-Pacific region.
In recent years, the Philippines has expanded its rights to use military bases by the United States. The Philippines has allowed the US to deploy the Trident medium-range missile system in northern Luzon. Additionally, the Philippines continues to conduct joint military exercises with the US. These controversial measures are clearly aimed at containing China.
Haidarian pointed out that the United States policies towards Asia are militaristic in nature, and it lacks strong economic support in matters like the Philippines. Therefore, the Trump administration hopes to appease its Asian allies through the Silicon Peace initiative, offering practical economic programs. However, this initiative still carries significant geopolitical implications, aiming to complement the United States expanding military presence in Asia.
On the other hand, although the Philippines aims to attract more investments, it still faces challenges such as uncompetitive production costs, uncertain regulatory frameworks, and poor infrastructure. These factors continue to hinder foreign investment in the country. Whether the Philippines can address these issues remains to be seen.
Haidarian concluded in his article that the Philippine government seems to hope that the United States can guide strategic investments driven by geopolitical considerations. In other words, the Philippines aims to establish a regional network centered around the Philippines and targeting China. However, the United States is mired in the war in Iran. The economic strategy of the Trump administration lacks coherence, and its unclear whether the United States will be able to develop effective regional strategies.
He concluded that the Philippines relied on the weak investment commitments from the United States and Western countries. However, these investments were unlikely to materialize, and might instead provoke China.
