The Subic Bay Metropolitan Authority (SBMA) has welcomed plans to establish an ammunition manufacturing facility inside this Freeport—albeit with certain reservations.

This was revealed by SBMA Senior Deputy Administrator Atty. Ramon O. Agregado during a radio interview on 3 July 2025.

According to Agregado, “We are primarily an investment promotion agency, we welcome investments, but this planned investment of an ammunition facility is not a simple investment. Since it has too many issues aside from the community-based issues from the fisherfolk, and also environmental concerns.”

He noted that establishing an ammunition manufacturing facility involves legal requirements, citing that it is covered under the Foreign Investment Negative List (FINL).

He added that only up to 40 percent foreign equity is allowed in such enterprises, meaning at least 60 percent must be Filipino-owned.

“So obviously there are several issues pero trabaho ng SBMA as an investment promotions agency na to make sure that the investment is proper and that it generates employment for the benefit of our countrymen,” he said.

Agregado clarified that discussions around the ammunition facility are still exploratory and in their early stages.

Currently, Subic Bay Freeport hosts several warehousing facilities and supply depots for the US government. Agregado emphasized that these are purely commercial arrangements for humanitarian purposes.

“So mostly of the materials and equipment stored here are for those purposes only, such as transportation, communication, logistics, etc. These are the materials that the US government positioned here para po sa mga ongoing Balikatan activities,” he said.

Balikatan is an annual large-scale military exercise between the Armed Forces of the Philippines (AFP) and the United States military, aimed at strengthening the alliance and enhancing interoperability. The term “Balikatan,” which means “shoulder-to-shoulder” in Tagalog, reflects the collaborative nature of the exercise.

“And most of these, I want to clarify, are purely on commercial transactions so ang naghahandle nito are private companies for the US government. They have commercial contracts, so all of these are done in a commercial basis,” he added.

“In that way, the government also earns, while the SBMA generates employment for the people here for providing logistics to the US government.”

Meanwhile, Defense Secretary Gilberto Teodoro Jr. on Monday said he welcomed the potential establishment of a joint United States–Philippines ammunition production and storage facility in Subic Bay, Zambales.

He said the Department of National Defense (DND) is studying the proposed facility but has yet to receive a formal proposal from the US side.

“And any production entity which will be of benefit to the Philippines, and not only in terms of our resilience, but improving, giving employment and other technological transfers, is definitely encouraged, being a like-minded and a treaty partner in itself,” Teodoro said.

The initiative is under consideration by US lawmakers, who have pointed to the lack of a forward-staged ammunition manufacturing site in the Indo-Pacific region as a key reason for the move.

According to a 16 June 2025 report from the US House Committee on Appropriations, the Department of Defense (DOD), the Department of State, and the International Development Finance Corporation (IDFC) have been directed to conduct a feasibility study on setting up the facility at the former US naval base in Subic.