Australia and the Philippines are working to finalize a new defense agreement aimed at boosting military cooperation and strengthening regional deterrence in response to China’s increasing activities in the South China Sea. The agreement, expected to be signed next year (2026), will facilitate more frequent joint military drills and support the development of defense infrastructure in the Philippines. This development comes as both countries are currently engaged in their largest-ever joint military exercises, which have coincided with a new confrontation between Chinese and Philippine forces in the Second Thomas Shoal.