Taiwan Today

Taiwan and the Philippines plan a shared future of trade and technology.

Taiwan’s Ministry of Foreign Affairs (MOFA) is laying groundwork to launch the Taiwan-Philippines Economic Corridor (TPEC), a comprehensive initiative to deepen bilateral collaboration across various industries including smart agriculture, semiconductors, artificial intelligence (AI), new energy, ports and shipping, information and communications technology (ICT), and logistics. The corridor will extend Taiwan’s industrial supply chains to the Philippines, expanding economic networks and diplomatic reach through coordinated public-private projects.

The initiative draws inspiration from the Luzon Economic Corridor (LEC), a development framework announced in 2024 and backed by the U.S., Japan and the Philippines to boost innovation, clean energy and supply-chain resilience. Taiwan sees potential synergies between its Greater Southern New Silicon Valley and northern Luzon and is assessing how TPEC could complement LEC projects and align with President Lai Ching-te’s (賴清德) vision of greater regional integration under the New Southbound Policy+ (NSP+), which seeks to forge digital technology, semiconductor, health, resilience, think tank, nongovernmental organization and youth corridors with countries in Southeast Asia, South Asia, Australia and New Zealand.

Complementary Strengths
The corridor strategy aims to support industrial upgrading, economic security and regional stability in the Indo-Pacific while reinforcing ties with the U.S. and Japan. As a fellow member of the first island chain with industries complementary to Taiwan’s, the Philippines is the ideal partner for the first NSP corridor. Cooperation will be rooted in already close economic and investment ties. In 2024 bilateral trade reached US$6.71 billion, with Taiwan ranking as the Philippines’ 10th-largest trade partner, eighth-largest export market and 10th-largest import source. Taiwanese investment totaled US$43.87 million in 2024, making Taiwan the 13th-largest foreign investor in the country.

According to Steve Chien (簡良達), chief supervisor at the nonprofit entrepreneurs organization Taiwan Association Inc. Philippines, Taiwan is ramping up engagement in the Philippines to create a Team Taiwan Fleet of mutually supportive industries. This approach leverages three decades of Taiwan-Philippines business experience to address gaps in the Philippine industrial ecosystem. The Philippines possesses a strong domestic market supported by, in 2024, US$106.8 billion in foreign reserves, US$38.4 billion in overseas remittances and US$38 billion in business process outsourcing and IT exports, yet an overreliance on overseas labor and the service sector limits industrial upgrading.

President Ferdinand Marcos Jr.’s administration is promoting manufacturing and industrial chain development through the CREATE MORE act, which encompasses tax reforms, investment promotion, industrial parks, green energy transition and technical-vocational education. International trends to mitigate dependence on China also present an opportunity for industrial growth. Chien believes remaining gaps in local industry can benefit from Taiwan’s electronics manufacturing clusters, semiconductor packaging, metal processing, industrial park expertise, renewable energy and agricultural technology. He added that bilateral partnership capitalizes on four main conditions: favorable timing amid global industrial reorganization, the two countries’ key geostrategic locations, abundant land for development in the Philippines, and a young, skilled Filipino workforce.

Challenges such as complex administrative procedures, uneven infrastructure and unfamiliar legal frameworks are mitigated through the Philippine Economic Zone Authority, local partners, business chambers and industrial park support, Chien said. Priority sectors for bilateral collaboration include industrial parks, manufacturing supply chains, agricultural upgrading, mineral processing, automotive components and defense industries. Taiwan stands as the Philippines’ closest and most reliable supply chain partner with its strong industrial capabilities and flexible production, while the Philippines offers abundant labor and access to the NSP market. Establishing an economic corridor thus represents a strategic, long-term win for both countries.

Emerging Framework
To support TPEC planning, the Executive Yuan’s Economic Diplomacy Task Force established the Taiwan-Philippines Economic Cooperation Task Force in September 2024 to coordinate interministerial resources and map potential areas of cooperation. The MOFA is also examining how a future economic corridor could fulfill the Taiwan-U.S. Economic Prosperity Partnership Dialogue’s goal of pursuing joint development in a third region.

As part of broader fact-finding, Minister of Foreign Affairs Lin Chia-lung (林佳龍) coordinated an investment and trade study delegation to the Philippines in August 2025. Organized by the Taipei Economic and Cultural Office in the Philippines and the Manila Economic and Cultural Office in Taiwan, the mission included Deputy Agriculture Minister Huang Chao-ching (黃昭欽), Chinese International Economic Cooperation Association Chair Lyu Jye-cherng (呂桔誠), U.S.-Taiwan Business Council Vice President Lotta Danielsson, American Institute in Taiwan officials and more than 80 industry representatives. Delegates covered full supply-chain capabilities across AI, cold-chain logistics, energy, food processing, ICT, port facilities, semiconductors, smart manufacturing and tourism. These insights will help shape the eventual structure of TPEC and guide how Taiwan integrates private-sector expertise into a “team of teams” platform to support the establishment and management of end-to-end supply chains in NSP countries.

Taiwan’s Industrial Development Administration subsequently partnered with the Taipei City-based Chinese National Federation of Industries and the Philippine Chamber of Commerce and Industry to hold the ninth Taiwan-Philippines Industrial Collaboration Summit in October 2025. At the event the Taiwan Electrical and Electronic Manufacturers’ Association and the Semiconductor and Electronics Industries in the Philippines, Inc. signed a memorandum of understanding to exchange technology and cultivate talent, strengthening semiconductor supply chain resilience amid evolving geopolitical challenges.

Port cooperation is also of critical importance, as future industrial collaboration will involve substantial cargo movement and port personnel exchanges. Taiwan’s Port of Kaohsiung and the Philippines’ Port of Subic Bay are deep-water harbors on major international shipping routes, and a Taiwanese business cluster has already developed near Subic Bay. The MOFA actively promotes  industrial convergence, notably hosting the “2025 Taiwan-Philippines Smart Port Development Forum” this December. The forum brought over 20 delegates from the Philippines to Kaohsiung and focused on areas such as smart cities, smart ports, sustainable tourism and maritime technologies. These initiatives facilitate the export of advanced Taiwanese technologies and improve shipping and logistics.

Capacity Building
Parallel to its work on industrial links, Taiwan is also reinforcing the developmental underpinnings required for the corridor to take hold. Since 2022 the International Cooperation and Development Fund (TaiwanICDF) has deployed technical teams across the Philippines to support initiatives that dovetail with TPEC’s focus on smart agriculture and human-capital formation. A central effort is the Agri-Cluster Consolidation and Cooperation Project in Tarlac province, where TaiwanICDF and local authorities have introduced smart greenhouses, precision irrigation and digital monitoring systems designed to enhance climate resilience and raise farm productivity. Initial results point to measurable income gains among participating households, while an accompanying internship program is cultivating a cohort of young technicians capable of sustaining more technologically intensive agricultural practices.
These activities help build the talent base that future corridor cooperation will depend on. TaiwanICDF’s scholarship programs, which bring Filipino graduate students to Taiwanese universities for advanced study in agriculture and aquaculture, further strengthen this pipeline. Training courses planned for 2026, spanning AI applications in agriculture, food security and rural innovation, will deepen the technical capacities needed to support TPEC’s long-term development.

Together these initiatives are giving the corridor clearer shape and setting up future integration with a growing lattice of Indo-Pacific cooperation. TPEC offers a forward-looking framework to align agriculture, smart technologies, ports and supply-chain systems in ways that elevate the economies of both Taiwan and the Philippines and allows Taiwan to work alongside like-minded partners while advancing its own approach to integrated diplomacy. As planning advances, the two sides are poised to turn respective strengths into shared opportunity, deepening economic ties, expanding industrial linkages and building a resilient partnership that supports long-term prosperity across the region. 

Write to Krakias Kai at kwhuang@mofa.gov.tw