AS Washington’s next political verdict looms, firms in Asia and the Philippines face persistent tariffs, artificial intelligence (AI)‑driven inequality and climate vulnerabilities that will shape investment, community consent and strategic alignment.

In his briefing to journalists, including myself at the International Trade Reporting Fellowship in Singapore two weeks ago, APAC Advisors Singapore CEO Steven Okun described a world that is unipolar, bipolar and multipolar at once. “Geopolitics today is not a return to a two‑power fight, it’s a triage of influence,” he said. For the Philippines, positioned at the intersection of US security ties, Chinese economic influence and Southeast Asian regionalism, the 2026 US midterms could influence where capital flows, which industries are protected and how communities can weather climate disruption.

Okun’s central point: many nations are “quiet quitting” dependence on both Washington and Beijing. This is visible in the country’s balancing act: our deep security ties with the United States, including enhanced defense cooperation and US access agreements, while courting Chinese investment in infrastructure and trade. A midterm outcome that empowers a more protectionist US trade posture could push Filipino policymakers to accelerate onshoring of critical sectors, seek diversified partners and weigh domestic industrial policy to protect jobs.

Several aspects of a protectionist act have implications for our climate actions which are affected by supply chains. First, tariffs change cost calculations for manufacturers, creating risk and opportunity. On one hand, fragmented supply chains and higher trade barriers could raise costs for export‑oriented electronics and semiconductors that rely on regional inputs. On the other hand, foreign companies seeking alternatives to China or reshoring closer to the US market may look to the Philippines for assembly, logistics or regional hubs, provided we can offer predictable regulation, energy and infrastructure.

Second, Okun frames AI as accelerating a K‑shaped divergence, where high‑skill, capital‑intensive firms surge while displacing routine work. AI can transform job quality and quantity in Philippine services sectors that have been growth pillars, e.g., BPOs.

Finally, the West Philippine Sea geopolitics shapes commercial risk. Escalation or hardening stances tied to US export controls or Chinese supply chain consolidation would heighten shipping insurance and reroute trade lanes. This raises the Philippines’ premium on maritime domain awareness and port diversification, developing secondary ports outside contested waters and stronger regional trade ties to hedge disruption.

Decisive part

All these make climate a decisive part of the picture. Okun highlights “gray rhinos” or foreseeable but underpriced climate events. The Philippines is among the world’s most climate‑vulnerable countries with frequent typhoons, sea‑level rise and flooding, regularly disrupting ports, power and manufacturing. Okun flags how local votes over data centers and projects can presage national outcomes.

The Philippines has seen local debates over mining, energy projects and large infrastructure. Local community pushback against energy‑hungry data centers, water‑intensive projects or poorly sited industrial parks is increasingly tied to climate and environmental justice. Expect similar politics around AI infrastructure and green industrial projects; communities will scrutinize water use, grid impacts and displacement risks.

Regardless of the midterm outcome, practical moves are recommended for our business and policy leaders.

Climate action: Align clean‑energy commitments, robust disaster-resilience measures and community benefit agreements to secure social license and attract stabilizing investment. Transparent environmental impact assessments and tangible local benefits such as jobs, training and revenue sharing will be essential. Map critical clean‑tech inputs like batteries, semiconductors, rare earths and assess tariff exposure under Section 301 under Tariff Act of 1974 and Section 232 under the Trade Expansion Act of 1962.

Prioritize resilient, renewable‑backed power and water strategies for industrial parks to reduce climate and social risk. Engage communities in major projects with climate adaptation plans and shared economic benefits to secure social license.

Tariff change: Fast‑track incentives for clean manufacturing, workforce training and improved port and power resilience to capture those relocations.

AI acceleration: Invest in nationwide reskilling and digital literacy programs, digital infrastructure and policies that encourage AI adoption in ways that create broad employment gains. These will also limit AI’s K‑shaped fallout and broaden labor market gains. Equitable access to AI tools will be critical to prevent provincial regions from falling further behind Metro Manila tech-wise.

Geopolitics: Strengthen port and logistics diversification to reduce dependence on single choke points and contested sea routes.

The 2026 midterms will shape who sets the rules for trade, technology and energy transitions. Okun said, “Either we adapt the system now or we wait for a crisis that forces change through disruption.” For the Philippines, the stakes are immediate: decisions in Washington combined with Beijing’s industrial strategy and Asean’s regional choices will influence where factories locate, how AI affects the environment, and ultimately, how communities fare when climate shocks hit. In that uncertain landscape, our path should be to harden political, economic and environmental resilience to attract stable investment while protecting people and the planet.

The author is the founder and chief strategic advisor of the Young Environmental Forum and a subject-matter expert at the Co-operative College of the Philippines. He completed a climate change and development course at the University of East Anglia (UK) and an executive program on sustainability leadership at Yale University (USA). Email him at ludwig.federigan@gmail.com.