Sayang! Philippines Lost a $1 Billion US Defense Loan to Poland Because of Red Tape
The Philippines missed out on a massive $1 billion defense loan from the United States — and it went to Poland instead. Philippine Ambassador to the US Jose Manuel Romualdez revealed the painful miss, saying American officials had already offered the money with "lenient" terms to beef up Manila's defense capabilities.
The loan was part of the National Defense Authorization Act for 2026, signed by US President Donald Trump in December 2025. The State Department was supposed to make $1 billion available to the Philippines between fiscal years 2026 and 2030. But the Philippines couldn't move fast enough.
"We were not ready for it," a frustrated Romualdez admitted on One News' "Storycon." The problem? A loan processing system that takes four to five months, plus a Marcos-era law — Presidential Decree 415 from 1974 — that caps external defense loans at just $300 million. The US needed approval in less than a month and a half.
Defense Secretary Gilbert Teodoro has been pushing to raise the cap on external defense loans to support the AFP Modernization Program, noting the current limit is a major obstacle. External defense loans must go through a rigorous process involving the Department of Finance and the Department of Economy, Planning and Development.
Hindi naman totally talo ang Pilipinas — the country still received $2.5 billion in security assistance under the Philippines Enhanced Resilience Act, part of the NDAA, to be distributed over five years focusing on command and control and cybersecurity. But that billion-dollar loan? That one stings.
Source: The Philippine Star
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