Manila and Beijing have a long history of maritime territorial disputes in the waterway, but relations sharply deteriorated recently over a series of incidents involving vessels from both countries.

Philippine military chief General Romeo Brawner said the country would develop "the islands and other features" it held.

The Philippines has outposts on nine reefs and islands in the Spratly Islands, located in the South China Sea.

Brawner said Thitu and Nanshan islands were among those where facilities would be improved with the installation of desalination machines and communications equipment.

"We are just trying to make it more liveable, more habitable for our soldiers because they really have poor living conditions," he told reporters.

The plan, however, did not include "fortifying the Sierra Madre", Brawner said, referring to the crumbling World War II-vintage ship grounded on Second Thomas Shoal by the Philippine Navy in 1999 to assert the country's territorial claims.

The Philippines would also acquire "more ships, more aircraft, radars", Brawner said, as part of a modest modernisation programme that began more than a decade ago.

Beijing claims almost the entire South China Sea and has ignored an international tribunal ruling that its assertions have no legal basis.

This month, China held military drills in the South China Sea as the United States and the Philippines conducted their own joint exercises in the same waters.

The drills followed a month of tense standoffs between China and the Philippines in disputed reefs in the area that saw a collision between vessels from the two countries and Chinese ships blasting water cannon at Philippine boats.

The Philippine Congress, meanwhile, has earmarked 800 million pesos ($14.3 million) for the transport department to build a port facility on Nanshan where boats, including those for fishing, could seek shelter.

Another 1.5 billion pesos had been allocated for the expansion of the airstrip on Thitu, Luis Campos, the vice chair of the House of Representatives' appropriations committee, said Sunday.