If your startup is B2B, Manila is great b/c the businesses here are so cheap. So you can find out if you are solving a real pain point, not a "nice to have".
English is an official language so communications is mostly a non-issue.
Apple opened an online store so hackers now have more options without paying 50% over US prices.
Downsides: startup community is non-existent. Graduates tend to flock to MSFT, IBM, etc. for a chance to go to the states but with the economic downturn and uncertain job security, that is changing. It's also harder to find the right kind of hackers for startups.
If you are looking for funding, it's very difficult.
Those are the major trade-offs. All in all, it was worth it for me and I now have a chance to positively affect the world wide movement towards entrepreneurship locally.
It's hard, lonely (most of the time) work but it's rewarding and invigorating. And you learn a ton (about business, yourself and life).
I transplanted to Manila (from SV a few years ago) trying to convince young local hackers to start their own or join my startup (the call of MSFT, IBM, etc. is strong in these parts). I have infected some young minds and plan to infect more.
If you are from the Philippines, give me a shout. Startup entrepreneurs are still hard to come by.