Before Duterte admin, Chinese investments surged 950% under Arroyo – study

MANILA, Philippines — Years before the Rodrigo Duterte's presidency ushered in the highest number of business deals with Beijing in Philippine history, Gloria Macapagal-Arroyo's administration opened the floodgates for Chinese investments.

This is based on the findings of a June 2024 study from the United States-based research group AidData, which tracked Chinese investments from 2000 to 2023. The report looks at China’s economic engagements with four Philippine presidents and the extent to which the country benefited from them.

Arroyo had “publicly embraced China as a friend” despite the two countries’ maritime disputes, according to the report, which AidData representatives presented to the media on Thursday, September 12. 

The study found that the former president courted Chinese investments at a time when Beijing was actively working to bring local enterprises overseas as part of the “going out” policy.

As a result, Beijing’s development finance to the Philippines spiked by more than 950% during her presidency (from US$88 million to US$931 million), particularly in energy and telecommunications projects.

“What is significant about looking at China's investments in the Philippines is it's highly responsive to bilateral relationships between Manila and Beijing,” Samantha Custer, director of AidData, said at a briefing on Wednesday, September 11. 

“You see a lot of difference in how China has engaged with the Philippines depending on who is in power. So with sympathetic or more open administrations that were keen to work closely with Beijing, you see a huge ramp up in investment,” she said.

In Arroyo’s first year in office in 2001, the Philippines received its first major development project funded by China: an $88 million loan for an irrigation project in Ilocos Sur. This project was described as akin to a “trial run” for China’s even larger investments in water and power supply in the next two decades.

By Arroyo’s final year in 2010, Chinese investments peaked at $931 million, driven by major projects like a coal-fired power plant and wastewater treatment in Metro Manila.

In contrast, the Aquino administration (2010-2016) saw a decline in Chinese investments