US Defense Secretary Lloyd Austin signed the deal with his Philippine counterpart Gilberto Teodoro at the start of a visit to Manila that also included a closed-door meeting with President Ferdinand Marcos.
The General Security of Military Information Agreement allows for the sharing of classified information that could benefit a US ally's national defence, and streamlines the sale of certain classified technologies, officials said.
It will give the Philippines access to "higher capabilities and big-ticket items" from the United States and "open opportunities to pursue similar agreements with like-minded nations", Philippine Assistant Defence Secretary Arsenio Andolong said.
Austin and Teodoro also held a ground-breaking ceremony for a combined command and coordination centre inside the Philippine military's headquarters in Manila.
"This centre will enable real-time information sharing for a common operating picture. It will help boost interoperability for many, many years to come," Austin said in a speech.
"It will be a place where our forces can work side by side to respond to regional challenges," he added.
- 'Combine strengths' -
Philippine military chief General Romeo Brawner said the centre would "enhance our ability to collaborate during crises, fostering an environment where our strengths combine to safeguard peace and security in our region".
Chinese foreign ministry spokesman Lin Jian said any military agreement or security cooperation must not target "any third party or harm a third party's interests -- let alone undermine regional peace, exacerbate regional tensions."
The Philippine defence department said Austin is due to visit the western island of Palawan on Tuesday for a meeting with Filipino forces responsible for patrolling the South China Sea and defending outposts.
Austin's visit comes as the Marcos government pushes back against Beijing's territorial claims over most of the South China Sea and as president-elect Donald Trump prepares to return to office.
China has brushed aside an international ruling that its claims in the South China Sea have no legal basis, and has deployed navy and coast guard vessels that Manila says harass its vessels and stop them accessing some reefs and islands in the waters.
This has led to violent confrontations that have resulted in injuries to Filipino personnel and damage to their vessels in the past 18 months.
That has sparked concern the United States could be drawn into an armed conflict due to its mutual defence treaty with the Philippines.
Washington has been strengthening its network of alliances aimed at countering China's growing military might and influence.
It has ramped up joint military exercises and regularly deploys warships and fighter jets in the Taiwan Strait and South China Sea -- infuriating Beijing.
Austin also announced $1 million in humanitarian aid to victims of a series of deadly typhoons and storms that hit the Philippines in the past month, the last one of which struck the country over the weekend.
That was on top of the $5.5 million in aid already provided to the Philippines through USAID since September, Austin said on X.
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