Subic Bay Naval Base in the Philippines, once America’s second-largest overseas military base next to its neighbor Clark Air Base, is set for a dramatic revival.
The base, closed in 1992 after lease negotiations failed, is now being transformed into the world’s largest weapons manufacturing and logistics hub.
The US and the Philippines have agreed to a plan that will turn the area into the world’s largest weapons hub, a move intended to help curb Chinese aggression in the region.
A Close Look at Subic Bay's History
The first European to document contact with the Philippines was the Portuguese explorer Ferdinand Magellan, serving the Kingdom of Spain, who met his demise there during the Battle of Mactan.
Forty-four years later, in 1565, a Spanish expedition led by Miguel López de Legazpi embarked from modern Mexico, initiating the Spanish conquest of the Philippines during the reign of Philip II of Spain, whose name has remained attached to the country ever since.
From 1565 to 1898, the Philippines was a Spanish colony. In 1868, a military expedition was dispatched to Subic Bay to survey its suitability for a naval yard.
Despite positive findings, the Spanish command in Manila was hesitant to relocate its primary naval base to the relatively isolated Subic Bay. However, after nearly two decades of deliberation, a Royal Decree in 1884 officially declared Subic Bay a naval port.
The US Establishes Control
In June 1898, Commodore George Dewey led an American naval force to formally seize control of Subic Bay, encountering minimal resistance from the Spanish naval forces defending the base. This event, coinciding with the end of the Spanish-American War, set the stage for the subsequent Philippine-American War.
The Spanish colonial period concluded on December 10, 1898, with Spain's defeat by the United States in the Spanish-American War and the signing of the Treaty of Paris. This marked the beginning of the American colonial era in Philippine history.
When American forces temporarily shifted their focus from Subic Bay, Filipino forces moved to occupy the base. It took the U.S. approximately one year to overcome the Filipino resistance to American rule. On December 10, 1899, exactly one year after the Treaty of Paris was signed, US Marines raised the American flag on the highest flagpole in the navy yard.
Naval commanders in the Philippines debated the suitability of Subic Bay as their primary naval base in the territory. However, President Theodore Roosevelt, a staunch advocate for a naval station at Subic Bay, issued an Executive Order in 1901 establishing the Subic Bay Naval Reservation.
World War I and Its Aftermath
Upon the U.S. entry into World War I, all Navy shipyards, including Subic Bay, operated at an intense pace to prepare vessels for deployment.
Following the war, however, the U.S. and four WWI allies signed the Washington Naval Treaty of 1922, which mandated the limitation of naval armaments. This treaty led to a reduction in the repair and maintenance capabilities for American naval forces in the Philippines.
Shops at the Subic Bay Navy Yard were dismantled, Fort Wint's status was downgraded to caretaker, and personnel levels were cut.
World War II
By the mid-1930s, the Nazis had taken power in Germany, and Japan was beginning to flex its military muscle. The United States Congress, therefore, authorized the release of funds with which to update the Coast Defenses of Manila and Subic Bays. It would not be enough to stop the Imperial Japanese Army from invading and occupying the Philippines and taking control of the base in December 1942, just one year after it launched its surprise attack on Pearl Harbor.
Almost two years later, on October 20, 1944, four U.S. Army divisions aboard 650 US Navy vessels landed at Palo Leyte, fulfilling General MacArthur's promise to return to the Philippines. The Japanese quickly moved to evacuate the Philippines and, by January 1945, they had all but abandoned Subic Bay.
Ironically and sadly, one of the bloodiest battles of WWII happened after the US retook Subic Bay. While Army engineers were busy around Subic Bay, other American Army forces began climbing the forested hills of Zig Zag Pass south of the base near Bataan.
They found a hornet's nest of Japanese there. After 15 days of fighting, the enemy positions were finally overrun. The Japanese had succeeded in their mission to slow the American advance but lost more than 2,400 troops. America suffered 1,400 deaths.
The Vietnam War
After WWII ended and the Philippines was liberated, the US designated Subic Bay as Naval Advance Unit No. 6, and it became a submarine and motor torpedo boat base.
Activity at the base was low, but that would all change after the Gulf of Tonkin incident and America’s subsequent decision to step up its military operations in Vietnam.
The Vietnam War saw the period of peak activity at Subic Bay as the base became home to the US Seventh Fleet forward and was used for repair and replenishment.
The average number of ships visiting the base per month rose from 98 in 1964 to 215 by 1967. During the war, the base had about 30 ships in port on any given day. The 4,224,503 sailors who visited Subic Bay in 1967 purchased more than $25 million in duty-free goods from the Navy Exchange.
After the fall of Saigon in the summer of 1975, hundreds of thousands of refugees fled Vietnam. Thousands of these refugees were rescued at sea by US Navy ships and taken to Subic Bay. A temporary processing center that handled thousands of refugees was set up on Grande Island in 1975. They were later taken to the Philippine Refugee Processing Center in Bataan.
The Philippines Takes Sovereignty Over Subic Bay
A 1979 amendment to the Military Bases Agreement changed the role of Americans at Subic Bay from landlord to guest.
The amendment confirmed Philippine sovereignty over the base and reduced the area set aside for US use.
As part of the deal, the U.S. granted the Philippines $500 million in military sales credits and supporting assistance.
Mount Pinatubo Erupts and America Leaves
On 15 June 1991, the second-largest volcanic eruption of the 20th century occurred when Mount Pinatubo, just 20 miles from Subic Bay, exploded with a force eight times greater than the Mount St. Helens eruption of 1980 that killed 57 people and devastated 210 square miles of wilderness. The sun was nearly blotted out by volcanic ash and volcanic earthquakes, heavy rain, lightning, and thunder from Typhoon Yunya that passed over northern Luzon resulted in a 36-hour period of complete chaos. When the eruption subsided a day later, Subic Bay was buried under a foot of rain-soaked, sandy ash.
The US Air Force’s Clark Air Base, less than 30 miles from Subic Bay and located much closer to Mt Pinatubo, was covered in tons of ash and was declared a total loss by the US military with no plans to restore it.
While Subic Bay was hit hard by the volcano, base personnel worked feverishly to restore services and reopen the base. By mid-July, service had been restored to most family housing units. Military dependents began returning on 8 September 1991 and, by the end of the month, almost all were back at Subic Bay from the United States. In September 1991, more than twenty thousand Filipino civilians were employed by the base. Where the volcano failed to close the naval base, politics finished the job.
With the Military Bases Agreement from 1947 due to expire, the US and Philippine governments tried to renegotiate terms between 1988 and 1992. These negotiations resulted in the Treaty of Friendship, Peace, and Cooperation between the United States and the Republic of the Philippines. This would have extended the lease of the American bases in the Philippines. However, the US government challenged the amount it would have to pay the Philippine government for the lease and use of the bases.
On December 27, 1991, Philippine President Corazon Aquino, who had previously fought to delay the US pullout to cushion the country's battered economy, issued a formal notice for the US to leave by the end of 1992.
Subic Special Economic and Freeport Zone
After the US military’s departure, Subic Bay was converted into a commercial zone under the leadership of Mayor Richard Gordon, who wanted to protect and preserve the $8 billion worth of facilities and property from looting and destruction.
Subic was transformed and became a model for base conversion into commercial use after the Cold War. Blue chip companies pumped in over $3 billion of investments and created 70,000 jobs in the free port's first four years.
US Military Quietly Returns
In 2022, the US and Philippine governments quietly prepared for US forces to return to Subic Bay amid increasing tensions with China. First, the Philippine Navy set up a Naval Operation Base (NOB) and, after the remainder of the port came up for sale, a US private equity firm Cerberus Capital Management acquired the port.
On November 9, 2022, US Ambassador to the Philippines MaryKay Carlson visited Subic Bay. Two weeks later, a Philippine official said that he would be "very surprised" if Subic Bay does not return to service as a US military facility through the new Enhanced Defense Cooperation Agreement between the two nations. That comment would be prophetic.
After the restoration of Subic Bay Airfield, the US Navy opened a new forward operating base that will host maritime patrol assets for territorial disputes in the South China Sea.
Situated along the former Naval Air Station Cubi Point at the edge of Naval Base Subic Bay, the project enhanced its surveillance aircraft and power projection around the region. This is only the beginning of Subic Bay’s military revival.
The World’s Largest Weapons Manufacturing Hub
In a strategic move to counter China's growing military presence, the United States and the Philippines are advancing plans to establish a massive weapons manufacturing hub at Subic Bay. This facility, backed by investments from the US and South Korea, is projected to double the Philippines' shipbuilding capacity to 2.5 million tons annually and create over 4,000 jobs by 2030.
South Korea's ambassador to Manila characterized the shipyard as a "tripartite partnership," leveraging Korean technology, US financing, and Philippine labor and geographical advantages. This initiative follows the deployment of advanced missile systems to the Philippines by Washington and signifies a deepening security alliance under President Marcos Jr., who assumed office in 2022.
During a recent summit with US President Donald Trump, Marcos Jr. framed the facility as integral to the Philippines' "self-reliant defense" strategy and a direct response to increased Chinese activity in the South China Sea, which Manila refers to as the "West Philippine Sea." Marcos emphasized the fundamental importance of defending their territory and exercising their sovereignty. Trump, in turn, stated that the Philippines would soon "possess more ammunition than any other country," including a wide array of missiles.
The plan involves creating a large-scale ammunition production and storage hub in the region, enabling swift joint US-Philippine responses in the event of a conflict. This builds upon Manila's 2023 decision to increase US access to Philippine military bases from five to nine and to host US ground-based missile systems, such as the "Typhoon" intermediate-range system and the "Nemesis" anti-ship missile. While the US military currently conducts only rotational training in the Philippines, the new facilities could lead to a permanent US military presence.
According to a US Naval Research Laboratory report, this represents "the most significant US defense investment in the Philippines since the Cold War."
With the US anticipating a potential conflict with China before the end of the decade, Subic Bay's strategic location — approximately 684 miles from Shenzhen and Taipei, 1,120 miles from Shanghai, and 1,740 miles from Beijing — places it well within range of China’s intermediate-range ballistic missiles. This proximity has caused concern among some Filipino political leaders. Vice President Sara Duterte warned that aligning too closely with Washington risks making the Philippines a "bullet shield for China."
China, of course, is expected to closely monitor these developments.
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