PAMPANGA, Philippines: Philippine officials on May 18 pushed back against reports that a planned United States-backed industrial hub on the main island of Luzon would operate under American laws or grant diplomatic immunity to US personnel.
The clarification came during the visit by US Undersecretary of State for Economic Growth, Energy and the Environment Jacob Helberg to New Clark City, where he joined Philippine officials in unveiling a marker for the proposed 1,620ha Pax Silica industrial hub under the Luzon Economic Corridor initiative announced in April.
Joshua Bingcang, president and chief executive of the Bases Conversion and Development Authority (BCDA), said the Philippines had rejected US proposals that would place the project beyond local jurisdiction.
“That’s their request, but we did not agree to that,” Bingcang told the media when asked about a Wall Street Journal report on April 17 claiming the hub would operate under US laws and enjoy diplomatic protections.
“There will be no special arrangement accorded to the US,” he added.
Bingcang said the project would instead fall under the Special Economic Zone Act, which governs investment incentives and operations in Philippine economic zones, as well as BCDA law that oversees the conversion and development of former US military bases into investment and commercial hubs.
Pax Silica is a US-led initiative aimed at securing the full technology supply chain, from critical minerals and semiconductor components to advanced manufacturing and data infrastructure, as Washington seeks to reduce reliance on China-dominated supply chains.
The proposed hub will rise within New Clark City, a 9,450ha government-developed industrial and smart city built on former US military land about 100km north of Manila.
The site forms part of the broader Luzon Economic Corridor, a US-backed initiative linking industrial hubs north of the Philippine capital, such as Clark, to Manila’s ports, logistics networks and markets.
The Philippines’ Trade Undersecretary Ceferino Rodolfo, who was also part of the delegation visiting Clark, likewise stressed that the framework being proposed was “based on Philippine laws”, citing existing foreign firms operating in Philippine economic zones under local regulations.
But when pressed on whether Washington would continue pushing for diplomatic immunity and provisions allowing the hub to operate on foreign soil under US laws, Helberg said he is “not going to get ahead of those conversations”.
“We’re going to have more detailed conversations about the best technical way to provide for investor protections for the long term, all the while ensuring that our approach also makes sense for the Philippines,” the US official told reporters.
He added that both sides had a two-year negotiating window to finalise terms for the project, which he said would need to provide “durability and certainty” for investors planning long-term capital-intensive operations.
United States officials led by Undersecretary of State for Economic Affairs Jacob Helberg talks to reporters in Pampanga, Philippines on May 18.
Helberg said more than a dozen American companies joined the delegation visiting Clark on May 18, including several billion-dollar companies interested in potentially becoming part of the planned industrial ecosystem. He did not disclose names for now.
“Every single company who’s here is interested in potentially being a part of this historic effort,” he noted.
A document presented by the Philippine government to the US State Department and later to reporters on May 18 says that Manila is offering a two-year lease-free grace period as an “in-kind contribution” to support bilateral economic security cooperation between the two countries.
The project signals that the US-Philippines alliance is expanding beyond traditional military cooperation into industrial policy, advanced manufacturing and economic security amid intensifying US-China competition over critical technologies.
Helberg framed the initiative as part of Washington’s broader effort to reduce dependence on China-dominated supply chains as global demand for AI-related infrastructure accelerates.
“When 90 per cent of a critical input comes from one country, you don’t have a supply chain, you have a hostage chain,” he said in a speech during his visit.
He cited vulnerabilities in rare earths, magnets, semiconductor packaging and other AI-related industrial inputs, arguing that the current system had become “predictably unreliable”.
Meanwhile, the Philippines, which holds some of the world’s largest nickel reserves, is positioning itself as a potential hub for processing minerals needed for batteries, data centres and artificial intelligence-related manufacturing.
Rodolfo said the Philippines aims to move beyond exporting raw “green minerals” – the essential raw materials required to build modern clean energy technologies – such as nickel and copper, and instead process them into higher-value “green tech metals” used in industries tied to the AI and clean energy ecosystem, including batteries, data centres, semiconductors and electronic components.
“With Pax Silica, it opens another platform for us, not just green minerals and green metals. Now we can aspire for green tech metals,” he said.
Bingcang said Manila’s and Washington’s technical site assessments at Clark would begin in June, followed by feasibility studies within the next two months after that.
Some activist groups and environmental advocates have criticised the proposed hub, warning it could deepen foreign influence over Philippine strategic industries and encourage environmentally harmful mineral extraction.
Rodolfo rejected those concerns, saying the Philippines was already exporting raw minerals regardless of the project and that the goal was instead to create more value domestically while remaining subject to Philippine laws.
“We have the Department of Environment and Natural Resources that fully protects our environment. And then second, we’ll make sure that these are all compliant with Philippine labour laws,” he said. - The Straits Times/ANN
