Philippines Defense Market Size, Trends, Budget Allocation, Regulations, Acquisitions, Competitive Landscape and Forecast to 2029

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Philippines Defense Market Report Overview

The Philippines defense budget is worth $4.1 billion in 2024 and is expected to register a robust CAGR of more than 6% during 2025-2029. Territorial claims in the South China Sea and the increasing strength and assertiveness of the Chinese armed forces have spurred the Philippines government to enhance its military capabilities, driving the Philippines’s defense expenditure. Additionally, the Philippines is planning to replace its obsolete equipment to combat the modern threat scenario. The country is expected to procure fighter and multirole aircraft, armored vehicles, naval vessels, patrol ships, maritime patrol aircraft, and surveillance equipment over the forecast period.

Philippines Defense Market Outlook, 2024-2029 ($ Billion)

Philippines Defense Market Outlook, 2024-2029 ($ Billion)

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The Philippines defense market research report provides the market size forecast and the projected growth rate for the next five years. Furthermore, our analysts have carried out a comprehensive industry analysis to determine key market drivers, emerging technology trends, key sectors, and major challenges faced by market participants, in this report. The Philippines defense market study has also assessed key factors and government programs that are expected to influence the demand for military platforms over the forecast period.

Market Size (2024) $4.1 billion
CAGR (2025-2029) >6%
Forecast Period 2025-2029
Historical Period 2020-2024
Key Drivers ·        Rise of Terrorism

·        Tensions in the South China Sea

Key Sectors ·        Military Fixed-wing Aircraft

·        Naval Vessels and Surface Combatants

·        Missiles and Missile Defense Systems

·        Submarines

·        Military Rotorcraft

Leading Companies ·        Lockheed Martin

·        HD Hyundai Co Ltd

·        Israel Shipyards

·        Boeing

·        Elbit Systems

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Philippines Defense Market Drivers

The defense budget is currently being driven by threats from terrorist organizations, tensions in the South China Sea, and efforts to modernize the armed forces.

Tension in the South China Sea is expected to augment naval procurement by the Philippines: China’s sovereignty claims over territory in the South China Sea, and the estimated 190 trillion cubic feet of natural gas and 11 billion barrels of untapped oil, have antagonized competing claimants such as the Philippines, Malaysia, Indonesia, Brunei, Vietnam, and Taiwan. These territorial disputes in the South China Sea have fueled military expenditure by Association of South East Asian Nations (ASEAN) members. Furthermore, illegal incursions have alarmed the Philippines government, which is therefore spending to strengthen its navy and air force by purchasing missile-guided frigates, gunboats, and two anti-submarine attack helicopters. The Philippines is prepared to deploy more coast guard ships to protect its fishermen from harassment by Chinese vessels within Manila’s exclusive economic zone in the South China Sea.

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Philippines Military Doctrines and Defense Strategies

The Philippines’ comprehensive security doctrine is focused on the acquisition of a wide range of security assets, to establish diplomatic and geographic advantages. The Philippines is also aiming to develop robust military capabilities through its ambitious Horizon I, II, and III programs to ensure tranquility, peace, and stability. The AFP Modernization Act aims to develop a self-reliant and credible strategic armed force, professionalize the AFP, and acquire and upgrade appropriate technology and equipment.

Furthermore, the country has been forming strategic alliances and partnerships with the US, Croatia, South Korea, and Indonesia. The United States and the Philippines have a long-standing strategic relationship in terms of defense. The US is a key partner in the Philippines’ Horizon II modernization program, providing military assistance and facilitating defense acquisitions. Similarly, the Philippines and South Korea have a strong and growing defense relationship. Both countries have been working to strengthen their partnership in the areas of defense, security, and counterterrorism. The military alliance between South Korea and the Philippines is considered one of the key military alliances in Asia.

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Philippines Defense Market Segmentation by Sectors

The key sectors in the Philippines defense market are military fixed-wing aircraft, naval vessels and surface combatants, missiles and missile defense systems, submarines, and military rotorcraft among others. The military fixed-wing aircraft sector was the largest sector within the Philippines defense market in 2024. The sector ranks first within the Philippines defense market with a cumulative investment of $3.5 billion during 2023-2028, with the highest contribution from multirole aircraft and transport aircraft.

Philippines Defense Market Analysis by Sectors, 2024 (%)

Philippines Defense Market Analysis by Sectors, 2024 (%)

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Philippines Defense Market - Competitive Landscape

A few of the leading defense companies operating in Philippines are:

  • Lockheed Martin
  • HD Hyundai Co Ltd
  • Israel Shipyards
  • Boeing
  • Elbit Systems

Lockheed Martin is headquartered in Bethesda, Maryland, the US. The company manufacturers security and aerospace products. The company is involved in research, design, development, manufacture, and integration of advanced technology systems, products, and services. It also offers management, technical, engineering, scientific, logistics, system integration, and cybersecurity services.

Philippines Defense Market Analysis by Companies

Philippines Defense Market Analysis by Companies

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Segments Covered in the Report

Philippines Defense Market Sectors Outlook (Value, $ Million, 2020-2029)

  • Military Fixed-wing Aircraft
  • Naval Vessels and Surface Combatants
  • Missiles and Missile Defense Systems
  • Submarines
  • Military Rotorcraft


The report provides:

  • Detailed analysis of the Philippines 2024 defense budget broken down into market size and market share.
  • Overview of key current and future acquisitions.
  • Explanation of the procurement policy and process.
  • Analysis of Philippines’s military doctrine and strategy to provide a comprehensive overview of Philippines’s military procurement regulation.
  • Outline of political alliances and perceived security threats to Philippines and trends in spending and modernization.
  • Analysis of the competitive landscape and strategic insights of Philippines’s defense industry.

Key Highlights

• Drivers of Defense expenditure include military modernization, national security concerns, internal security challenges

• Major ongoing procurement programs include procurement of Wonhae-class Offshore Patrol Vessels, Fast Attack Interdiction Boats, S-70

Reasons to Buy

  • Determine prospective investment areas based on a detailed trend analysis of the Philippines defense market over the next five years.
  • Understand the underlying factors driving demand for different defense and internal security segments in the Philippines market and identify the opportunities offered.
  • Strengthen your understanding of the market in terms of demand drivers, market trends, and the latest technological developments, among others.
  • Identify the major threats that are driving the Philippines defense market providing a clear picture of future opportunities that can be tapped, resulting in revenue expansion.
  • Channel resources by focusing on the ongoing programs that are being undertaken by the Philippines government.
  • Make correct business decisions based on an in-depth analysis of the competitive landscape consisting of detailed profiles of the top defense equipment providers in the country. The company profiles also include information about the key products, alliances, recent contracts awarded, and financial analysis, wherever available.

Table of Contents

  • 1. Executive Summary
  • 2. Defense Budget Assessment

    • 2.1. Budgeting Process
    • 2.2. Defense Market Size Historic and Forecast
    • 2.3. Drivers Of Defense Expenditure
    • 2.4. Analysis of Defense Expenditure Allocation
    • 2.5. Analysis Of Defense Budget Allocation

  • 3. Military Doctrine and Security Environment

    • 3.1. Military Doctrine and Strategy
    • 3.2. Strategic Alliances and Geopolitics
    • 3.3. Political, Social and Economic Scenario

  • 4. Market Entry Strategy and Regulations

    • 4.1. Defense Procurement Bodies
    • 4.2. Procurement Policy and Market Regulations
    • 4.3. Market Entry Routes
    • 4.4. Key Challenges
    • 4.5. Major Deals and M&A

  • 5. Market Attractiveness and Emerging Opportunities

    • 5.1. Market Attractiveness by Defense Sector
    • 5.2. Top Sectors in the Philippines Defense Market
    • 5.3. Top Defense Segments by Value

  • 6. Defense Platforms Import and Export Dynamics

    • 6.1. Defense Platforms Import Dynamics (Value)
    • 6.2. Value of Equipment Imported Between 2016 to 2022 ($M)
    • 6.3. Defense Platforms Import Dynamics (Units)
    • 6.4. Volume of Equipment Imported Between 2016 to 2022 (Units)

  • 7. Defense Platform Acquisitions

    • 7.1. Defense Platform Acquisitions By Value
    • 7.2. F-16C/D
    • 7.3. C-130J
    • 7.4. Wonhae-class Offshore Patrol Vessels
    • 7.5. Fast Attack Interdiction Boats
    • 7.6. S-70i Black Hawk

  • 8. Fleet Size

    • 8.1. Army
    • 8.2. Air Force
    • 8.3. Navy

  • 9. Competitive Landscape

    • 9.1. Defense Companies Operating in the Philippines
    • 9.2. Main Defense Companies

  • 10. Appendix

Frequently asked questions

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