ing a 1992 Senate hearing, Philippine Secretary of Foreign Affairs Roberto Romulo stated that he United states was treaty-bound to support the Philippines in the event of an attack on Philippine – claimed territory into the South China Sea. The Spratly debate is still going on today. This casts some light on the relationship between the MBA and the MDT. Before the termination of the MBA, the U.S. military and naval presence provided the Philippines with the physical guarantee of the commitment embodied in the MDT. The U.S. pull out, however removed this physical evidence. At the same time, the weakened defense establishment of the Philippines made this commitment even more critical. As a result the Philippine government has sought to establish a new agreement that would bring back the U.S. Military presence. The current agreement (signed by President Ramos in 1998) is the Visiting Forces Agreement (VFA) allowing U.S. Military to conduct temporary joint exercises and training with the AFP. However, the VFA has been the topic of much controversy in current Philippine politics. In addition to the wide spread student protests, many militant nationalist groups have already warned that should the VFA be implemented all past peace negotiations with their groups are void. The future of Philippine-American Military relations’ remains to be seen, but the certainty that these relations are vital to Philippine security, has drawn the support of the past three Presidents, Aquino, Ramos and the current day Estrada.CONCLUSIONThe U.S. Military presence in the Philippines has had a profound impact on Philippine politics and economy. Economically, it was thought that the U.S. pull out would have devastating effects on the already impoverished economy. However, through the quick thinking and ingenuity of the Filipino economists and Technocrats put in charge of the base conversion projects, the Philippine economy not only recovered fr...