ISS Risk Special Report:

Philippines – Emergent Epicentre to Islamic State’s Southeast

Asian Ambitions?

9 May, 2016

About ISS Risk

Intelligent Security Solutions (ISS Risk) is a bespoke independent frontier, emerging, and

selected developing markets political risk research, due diligence, and business solutions

consulting company. ISS Risk has formed a highly qualified and experienced team with an

extensive network of organic connections committed to providing clients with

comprehensive, high-end quality information, intelligence, and security services. ISS

specializes in the North East Asia region (China, Mongolia, DPRK, and South Korea); South

Asia region (Myanmar, Pakistan, and Bangladesh); Central Asia (Kazakhstan, Kyrgyzstan,

and Uzbekistan) and South East Asia region (Indonesia, Malaysia, Thailand and the

Philippines). ISS Risk has its headquarters based in Hong Kong with representation in

DPRK, Mongolia, Myanmar, Philippines, Thailand, Shanghai and Beijing.

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Executive summary

With its dominant presence in Iraq and Syria, it is sometimes easy to discount the expansive

scope of the Islamic State’s ambitions of a global caliphate. Our observations and research

indicate that, regardless of the success of ISIS in this stronghold, the group is undoubtedly

growing in other parts of the world. This report focuses on the future prospects of ISIS in SE-

Asia, contending that, ceteris paribus, the Philippines will soon be the headquarters for ISIS

in the region.

This report provides the rationale behind this assertion by elucidating the pre-existing

presence of terrorist organisations across the Philippines in light of the current domestic

political and social conditions. Additional analysis of how regional neighbours, most notably,

Malaysia and Indonesia are handling extremism are additional factors that support our

thesis. We assert that the Philippines will emerge as the epicentre of Islamic extremism in

SE-Asia, but there is no doubt that the entire region will be affected by the establishment of a

base in the region. This base will aid in facilitating the movement of followers, planning

attacks, fundraising, and cultivating strategic alliances between local terrorist groups.

The Filipino government is not doing nearly enough to curtail the radical threat of ISIS or,

more generally, terrorism in the country. Juxtaposed with the strong-armed efforts by the

Malaysian and Indonesian governments in their respective homelands, the use of the

Philippines as a jihadist functionary is being ever more exacerbated as alternative operating

options in the region dwindle. One of the major issues in the Philippines is the

underestimation of the influence of ISIS, illustrated by the labelling of local extremist

networks as ‘criminal gangs’ or ‘bandits,’ rather than Islamic extremists. Currently, the

majority of SE-Asian terrorist groups have training camps in Southern Philippines and the

state has become the major transit hub for those traveling to Syria. Unfortunately, without

proper recognition of the issue by the Filipino government, terrorist activities will only

continue to escalate.

There are, however, potential pitfalls that ISIS would have to overcome before successfully

establishing a headquarters in the Philippines. One is the lack of collectively recognised

leadership. Without this, there is little sense of unity between ISIS disciples as there is no

one to align varying agendas and objectives. With a plethora of breakaway groups in the

country, a leader that can unify the fractions is vital to establishing a strong SE-Asian base.

Finances are another matter that ISIS affiliates in the Philippines must address in order to

secure a headquarters in the state. Records from Mosul indicate that local cells must

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contribute 20% of their generated income to other local and provincial cells, placing a

significant financial demand on pledged organisations. Consequently, there has been an

increase in kidnappings, ransoming, piracy, and extortion across the Philippines, but

especially in Mindanao, where jihadist groups have the greatest presence. In order to

sustain a successful base, ISIS will have to ensure a steady flow of income.

The state of the situation is dependent upon the outcome of two major occurrences: the

results of the election and the status of the BBL - both of which will occur in the next few

months. The outcome of the election may usher in a new government with greater concern

for and capacity to confront the growing terrorism problem across the country. Conversely, it

could usher in a new leader that maintains the status quo of inactively addressing the

situation for another 6 years. This ties directly to the second major outcome, which is the

passing, postponement, or rejection of the BBL. Should it pass, Islamic separatism and

Islamic fundamentalism will be pitched against each other, slowing down the aspirations of

ISIS in the country. If it does not pass, the unchanged dynamic will perpetuate

circumstances that allow ISIS to operate and thrive in the area. The next few months will

essentially determine the future of terrorism and the capacity of ISIS in the Philippines.

When considering the ambitions of ISIS, no corner of the world can be left examined.

Presently as well as well as historically, SE-Asia has been rife with terrorism and the future

outlook does not appear to be any different. If the status quo continues, we predict the

circumstances in the Philippines will align with ISIS ambitions, allowing the terrorist group to

foster a thriving epicentre for regional operations.