SECRET UK EYES A
19. With such massive foreign debt inherited from the Marcos era, there are no really large scale export opportunities, but the AFP do need a range of new equipment to conduct cOIN operations more effectively and Annex D covers this topic. Two general points are worth recording here. First, we will only gain access to this limited market if the relevant industries make a sustained effort and come forward with detailed and credible proposals. GKN have done this with SIMBA and appear (at this stage) set to secure a valuable order, although I became aware of a US company attempt to sabotage it in high places during my visit. Other companies have been less consistent and effective and will soon miss their chance if they do not do better. The second point concerns initial training and logistic support, where the AFP will need some essential pump-priming if they are ever to take new equipment effectively into operational service. Again, an imaginative package has been offered by GKN for SIMBA which could well clinch the order.
20. On wider issues, the longer term future of the US bases at Clark Field and Subic Bay has now to be decided following the recent interim 2-year settlement. Public opinion polls currently indicate strong support for the bases, which bring in a substantial income, but the subject provides a natural neo-colonial target for the insurgent movement. When I asked him, Mr Ramos thought (and clearly hoped) that at least one US base would survive until 1998 and he did not rule out the prospect of a longer term tenure for both bases running into the next century.
21. General de Villa (COS AFP/CDS equivalent) surprisingly asked me in the presence of Mr Ramos and HMA if the UK would have a view on an application from the Philippines to join the FPDA. As this question was repeated later to HMA during a reception at his residence, we assumed they were taking a serious interest and, on both occasions, we responded with the now well established UK line. Without a perceptible external threat, it is difficult to know why this arose, but it is possible that the closure of the US bases could occur earlier than anticipated leaving them vulnerable to external action, though we made it clear that the FPDA implied a commitment only to consult in such circumstances.
22. Overall, I found this an interesting and useful visit which helped my understanding of the current fragile developments in the Philippines. Although it lies a long way down our list of strategic priorities, our quiet interest and help is highly valued, both as a small unpublicised contribution to security and, more widely, in terms of the legitimacy and moral support it provides for their new democracy. Given our long term interest in maintaining stability in this area, I discussed with HMA the possibility of raising the current P3 rating as a means of releasing slightly more UKMTAS funds for low key training support in an area where a relatively small additional investment might reap dividends out of all proportion to the costs involved. My own view is that this would be a worthwhile change which might also benefit indirectly our limited prospects for defence exports, but it will need sensitive application if we are to avoid undesirable publicity and raise the security risk to our interests in the Philippines.
F VVISREPS/1
6 of 10 SECRET UK EYES A
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