In South China Sea, a US ally navigates deal with China

That outpost, an old warship with a small detachment of Filipino marines, has been a volatile flashpoint for months. China, which claims the reef, along with much of the South China Sea, has used aggressive tactics to obstruct Philippine resupply missions, including the spraying of water cannons, and swarming and ramming of Philippine vessels. During a resupply last month, Chinese personnel wielded axes and knives.

An agreement between China and the Philippines earlier this month appeared to defuse tensions and the Philippines carried out one delivery without incident.

But China and the Philippines have issued conflicting statements about the terms of that understanding, with Manila rejecting Beijing’s demands that supply missions be notified in advance and be subject to inspection.

Philippine Foreign Secretary Enrique Manalo on Tuesday called the recent resupply—which wasn’t obstructed by China—“a relative success." On the issue of notification, he said: “The more accurate term is ‘exchange of information,’ which is exactly what we did with China."

The Philippine statements came after a meeting in Manila of U.S. Secretary of State Antony Blinken, Defense Secretary Lloyd Austin and their Philippine counterparts. Blinken said the U.S. welcomed the provisional agreement between China and the Philippines, which is a U.S. ally. He said the recent resupply should be the standard, not the exception.

With concern over China’s growing military might in the region, the Americans reaffirmed their plan to provide $500 million in foreign military financing to the Philippine military. The funds, which Austin called a “once-in-a-generation investment," will be used to help the Philippine military acquire naval maritime surveillance and cyber systems.

They represent a vast increase over previous U.S. military financing and are intended to help the Philippine armed forces build up their capability to deal with external threats after years of focusing on terrorist threats at home.

On Wednesday, Austin plans to visit Subic Bay, where the Philippines has a naval headquarters and the country is providing maintenance for U.S. Navy ships.

Subic Bay served as one of the largest American overseas bases until it was closed in 1991, but it is now seen as a place where the U.S. can have vessels repaired and overhauled as they operate in the Pacific, a senior U.S. defense official said.

The U.S. is also planning to spend $128 million to develop Philippine military sites under the countries’ Enhanced Defense Cooperation Agreement. Those funds have been proposed by the Biden administration but need to be approved by Congress.

That accord enables the U.S. military to rotate forces through nine Philippine bases and is an important component of the network Washington has been developing to respond to Chinese threats to Taiwan or in the South China Sea.

The U.S. is also working on an agreement with the Philippines that it hopes to finish by the end of the year to share intelligence and defense technology.

Blinken and Austin met Tuesday morning with Philippine President Ferdinand Marcos Jr.

“I’m always very happy that these communication lines are very open so that all the things that we are doing together, in terms of our alliance, in terms of the specific context of our situation here, in the West Philippine Sea and in the Indo-Pacific, are continuously examined and re-examined so we are agile in terms of our responses," Marcos said.

The initiatives announced Tuesday are part of a broader American push to strengthen the military capabilities of its Asia allies. On Sunday, the U.S. announced that it was establishing a new military command to bolster security ties with Japan.

The U.S. is involved in an ambitious effort to help Australia acquire nuclear-powered submarines. Blinken and Austin will meet with the Australian foreign and defense ministers at a meeting to be held early next month in Annapolis, Md.

Write to Michael R. Gordon at michael.gordon@wsj.com