Philippines and South China Sea

Spotlight By Dr. Sampa Kundu

For President Duterte, this legal battle against China is something that came as a legacy from his predecessor Aquino III

July 12 was an extra-ordinary day for the Philippines as the modest Southeast Asian economy won an international legal battle on South China Sea (SCS) against its colossal neighbour, China. The Permanent Court at The Hague (PCA), constituted under Article 287, Annex VII of the United Nations Convention on the Law of the Sea (UNCLOS), “handed the Philippines a landmark victory against its giant neighbour”. According to the Filipino political analyst, Richard Javed Heydarian.

“Most experts anticipated a favourable outcome, but few predicted its breadth. Not only did the tribunal exercise jurisdiction on almost all of the Philippines’ arguments, it also ruled favourably on the most thorny and consequential items, particularly China’s doctrine of ‘historic rights’.

In the backdrop of the South China Sea (SCS) verdict, this commentary seeks to understand why President Rodrigo Duterte took a softer attitude towards China unlike his predecessor Benigno Aquino III? What is the role of ASEAN in this inordinately-followed play of contemporary world politics and finally, what could be its possible implications on the region?

For the Philippines, the SCS ruling came at a very significant time. The new President came to power at the end of June 2016 and the Permanent Court of Arbitration (PCA) ruling was published on July 12. For President Duterte, this legal battle against China is something that came as a legacy from his predecessor Aquino III. The familial lineage of President Duterte, which had some connection with China and his recent statements favouring a bilateral talk (even a backchannel negotiation) with China make him a little different from Aquino III. There are reports indicating President Duterte having invited former President Fidel Marcos to visit Beijing and open a backchannel negotiation regarding the SCS verdict. Interestingly, a few days before the verdict, while being asked about his opinion on the SCS dispute and PCA’s upcoming ruling, President Duterte chose not to speak on the same; instead advising the nation to practice restraint and wait for the ruling to come out. On the same occasion, on June 27, President Duterte had mentioned that he may depute the Transportation Secretary Arthur Tugade to China to "not to talk about war, not to talk about irritations there, but to talk about peace and how they can help us."

Several reasons explain his compromising attitude towards China in general and towards SCS disputes in particular:

Domestic Matters are the Priority: Though the Philippines recorded 5.8 percent growth in its Gross Domestic Product (GDP) in 2015, which is expected to touch six percent in 2016 , the unemployment rate (6.4%) in the country is highest among countries comprising the Association of Southeast Asian Nations (ASEAN). Despite Aquino’s Conditional Cash Transfer (CCT) and the Comprehensive Agrarian Reform Programme (CARP), which were aimed at reducing poverty in the mid- to long-term and huge remittances received from its overseas workers, about 25 percent of the 99.14 million Filipinos still live below the poverty line.

According to some assessments, remittances contribute around 10 percent to the country’s GDP. Alongside this economic inconsistency, there were various other factors that facilitated Duterte’s huge success in the election. At his presidential inaugural speech too, he spoke about domestic concerns such as infrastructure, corruption, drug trade, poverty, unemployment, ethnic and religious unrest, insurgency and terrorism. Therefore, logically, the Filipino President is not expected to waste any time by diverting his interests to a pending legal battle against a giant neighbour, with whom it shares significant economic relations; he is focusing on investing time to resolve the domestic matters, which are challenging the common Filipinos on an everyday basis. Moreover, President Duterte is fully aware of China’s major projects that are likely to help Philippines in many ways such as infrastructure, employment generation and trade and foreign investment. Rajiv Biswas, Asia-Pacific chief economist at IHS Markit mentioned, "President Duterte is likely to choose negotiations with China, including the possibility of a resources-sharing arrangement for the disputed territorial claims, rather than triggering a confrontation with Asia's military superpower.”

A Balance between China and the US: For the Filipino President, maintaining a fine balance between China and the US is important as both of these countries are likely to serve his purposes. With the US, Manila already shares a strategic partnership while defence and security relations between these two countries are on steady rise. However, President Duterte is likely to build a good relation with China too, primarily because of economic interests. Gregory Poling, director of the Asia Maritime Transparency Initiative at the Center for Strategic and International Studies (CSIS), mentioned, “If Duterte can negotiate a fishing deal at the Scarborough Shoal – a major flash point in the territorial dispute – or another resource sharing agreement in areas disputed bilaterally by China and the Philippines, he would gain U.S. support”.

This sounds logical in the pretext of US’s rebalancing to the Asia-Pacific. This was highlighted in the recent ASEAN Foreign Ministers’ Meeting and East Asia Forum, held in Laos, in the last week of July, where the Filipino Foreign Secretary, Perfecto Yasay stated, "… the dispute is …between China and the Philippines. The others are not concerned with that dispute."

Clearly, this is an indication that and other powers (including the US) should not increase any tension in the region. Perhaps, US, too, has understood the changed dynamics in the region as John Kerry opined that US supports Manila’s actions for bilateral talks with China. China's Foreign Minister Wang Yi had also urged the US to offer support for bilateral talks between China and Philippines and Kerry further said, “And we agree with that ... no claimant should be acting in a way that is provocative, no claimant should take steps that wind up raising tensions."

The Independent ASEAN Stand: The Chairman’s Statement at the 23rd ASEAN Regional Forum, joint statement of the foreign ministers of ASEAN and China on the effective implementation of the Declaration of Code of Conduct (DoC) on South China Sea, Joint Communique of the 49th ASEAN Foreign Ministers’ meeting and 6th East Asia Summit Foreign Ministers Meeting all mentioned about safety and security in the region, full and effective implementation of the DoC and early conclusion of the Code of Conduct (CoC), resolving territorial and jurisdictional disputes by peaceful means, commitment of not using threat or use of force, exercising self-restraint, undertaking cooperative activities and MFA to MFA hotline to deal with emergency situation among many other issues.

The Counter-Narrative and Possible Future Scenarios

What looks like an easy escape for China to ignore the PCA verdict as Manila appears to have agreed with China’s favoured approach, namely, bilateral negotiation to resolve the territorial disputes, may not be a reality. The Filipino President, Duterte, who is known for his unforgivable stand on criminality and claimed much media attention due to his statements like landing up in the South China Sea disputed islands on a jet-ski to hoist the Filipino flag, may take a U-turn from his present stand and given his unpredictable nature, this possibility cannot be ruled out. In the Asia–Europe Meeting (ASEM) meeting in Mongolia, Filipino Foreign Secretary Mr. Yasay turned down the Chinese offer of discussing the SCS disputes outside the verdict of the PCA.

Prof. Heydarian mentioned that if China does not comply with the ruling at all, Manila can request the International Seabed Authority, instituted under the UNCLOS, to suspend China’s permits to extract resources in international waters. Further, Philippines can also go for additional arbitration if China continues to exploit the natural resources within Philippines’s EEZ.

Final Words: More Actions from China Expected?

At the same time, it is likely that China may escalate the tension by stationing more troops in the artificial islands if its sense of being cornered at the international level increases or if it wants to ‘de-legitimise’ the PCA’s jurisdiction on the disputed territories or if it wants to prevent countries such as Vietnam from following the example of the Philippines. Wu Shengli, the commander of the People's Liberation Army Navy (PLAN) already told his US counterpart Admiral John Richardson, “We will never stop our construction on the Nansha Islands halfway…The Nansha Islands are China's inherent territory, and our necessary construction on the islands is reasonable, justified and lawful.”

In brief, the present situation in South China Sea, the PCA verdict and China-Philippines relations are still unfolding. As far as the Philippines is concerned, given the present circumstances, especially as President Duterte prefers to face the domestic challenges first, it is likely that the status quo would be maintained in the region. The rest, however, depends on China.

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Author

The writer is Research Assistant at Southeast Asia and Oceania Cluster, Institute for Defence Studies and Analyses New Delhi

1 Richard Javad Heydarian, “The day after: Enforcing The Hague verdict in the South China Sea”, Brookings, July 25, 2016, at http://www.brookings.edu/research/opinions/2016/07/25-day-after-south-china-sea-heydarian (Accessed July 27, 2016)

2 Ibid

3 Fidel Ramos is the former President of Philippines (1992-1998) and was instrumental in evicting Ferdinand Marcos. He was one of the founders of the Boao Forum based in Hainan, China, which promotes economic dialogue in Asia. See, CrisLarano, Philippines’ Duterte Asks Ex-President to Begin Talks in South China Sea Dispute, Wall Street Journal, July 15, 2016, at http://www.wsj.com/articles/philippines-duterte-wants-ex-president-ramos-to-meet-with-china-on-maritime-dispute-1468520651 (Accessed July 26, 2016)

4 Patricia Lourdes Viray, “Duterte on South China Sea dispute: We shut up”, Philstar, June 27, 2016, at http://www.philstar.com/headlines/2016/06/27/1597169/duterte-south-china-sea-dispute-we-shut (Accessed July 26, 2016)

5 Ibid

6 Sampa Kundu, “Understanding Duterte: The Unpredictable President of the Philippines”, IDSA web Commentary, July 14, 2016, at http://www.idsa.in/idsacomments/understanding-duterte-president-of-the-philippines_skundu_140716 (Accessed July 30, 2016)

7 “Philippines Economy”, Asian Development Bank, at http://www.adb.org/countries/philippines/economy#tabs-0-2 (Accessed June 08, 2016)

8 “Selected Key ASEAN Macroeconomic Indicators”, ASEAN Statistics, ASEAN Secretariat, August , 2015, at http://www.asean.org/storage/2015/09/selected_key_indicators/table2_as_of_Aug_2015.pdf (Accessed May 17, 2016)

9 “Data-Philippines”, The World Bank, at http://data.worldbank.org/country/philippines (Accessed May 17, 2016); see “Introduction”, in Walden Bello et al, State of Fragmentation: The Philippines in Transition, Focus on the Global South and Friedrich Ebert Stiftung, 2014, at http://focusweb.org/content/state-fragmentation-philippines-transition (Accessed June 07, 2016)

10 Ibid.

11 Nyshka Chandran, “Philippines President Duterte to strike cautious tone with China on South China Sea ruling”, CNBC, July 25, 2016, at http://www.cnbc.com/2016/07/24/philippines-president-duterte-to-strike-cautious-tone-with-china-on-south-china-sea-ruling.html (Accessed July 26, 2016)

12 Ibid

13 Simon Webb And Manuel Mogato, “U.S. says backs resumption of China-Philippines talks on South China Sea”, Reuters, July 26, 2016, at http://www.reuters.com/article/us-southchinasea-ruling-china-idUSKCN10604M (Accessed July 27, 2016)

14 Ibid

15 “Philippines rejects conditional talks on South China Sea dispute”, ABC News, July 19, 2016, at http://www.abc.net.au/news/2016-07-19/philippines-rejects-offer-of-south-china-sea-talks/7640924 (Accessed July 27, 2016)

16 Richard JavadHeydarian, Note no. 1

17 ABC News, Note No. 16

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