Philippine and Australian carriers will now be allowed to offer up to 4,000 seats each way per week between major Australian cities such as Sydney, Perth, Melbourne and Brisbane, and Manila or Clark in the Philippines.
The old limit was 2,500 seats a week.
Over time, and depending on demand, the new limit could be raised to 6,000 seats, Australia's envoy to Manila, Rod Smith, told reporters.
The air agreement also authorises the carriers of both countries to operate unlimited services to regional airports.
Around 313,000 people travelled between Australia and the Philippines last year, making Australia a top-five source of tourist traffic here, according to official data.
'The new arrangements are a good example of Australia and the Philippines working together to liberalise international aviation to the benefit of the travelling public, the tourism industry and airline carriers in both Australia and the Philippines,' Smith said.
The governments also agreed to allow dependents and spouses of diplomatic personnel to work in either country, Smith said.
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