Two years ago, President Rodrigo Duterte \u2501 freshly installed as president \u2501 went on his maiden trip to China, expecting a grand welcome. And yes, indeed, the Chinese gave him a red-carpet welcome with all the fanfare worthy of royal visitors. For four days, he enjoyed the treatment accorded him. Chinese President Xi Jinping welcomed him like a prodigal son who was lost in the wilderness of America\u2019s hegemony in Asia. <\/p>\n
Duterte was impressed with the Chinese \u201cmiracle\u201d that brought the country, from the \u201cThe Sick Man of Asia\u201d to the world\u2019s second economic power after the U.S. Heck, he must have mused: \u201cIf China could do it, so can we.\u201d He probably figured that if there\u2019s one country that can help him make the Philippines into another economic power, it\u2019s China, not America.<\/p>\n
And before he wrapped up his state visit, Duterte spoke before an audience of China\u2019s corporate leaders. He announced \u2501 to the whole world \u2501 his military and economic \u201cseparation\u201d from the United States. \u201cAmerica has lost now. I’ve realigned myself in your ideological flow,” he told the CEOs in Beijing. “And maybe I will also go to Russia to talk to Putin and tell him that there are three of us against the world: China, Philippines and Russia. It’s the only way.” <\/p>\n
Sweetheart deal<\/p>\n
Xi must have been tickled pink when he heard Duterte \u201cdivorcing\u201d himself from a marriage with America that he believed didn’t do any good to his country. He has been saying that China\u2019s financial help was the key reason for his pivoting to China. In reciprocation to Duterte\u2019s \u201cpivot,\u201d China was going to treat him like her new \u201clittle brother,\u201d who\u2019s coming home at last. <\/p>\n
Indeed, Duterte\u2019s state visit to China was a resounding success. And as a \u201cdowry,\u201d the Chinese offered him a \u201csweetheart deal.\u201d Duterte signed a total of 27 deals \u2501 $9 billion in \u201csoft loans\u201d and $15 billion worth of direct investments from Chinese firms in railway, port, roads, energy, and mining projects. <\/p>\n
Everything seemed to be going just fine since Duterte came back home with deals totalling $24 billion. Now, he can proceed with his pet project, \u201cthe golden age of infrastructure\u201d under his ambitious \u201cBuild, Build, Build\u201d program, which would be in lock steps with Xi\u2019s ambitious \u201cOne Belt, One Road\u201d global initiative to connect three continents from Asia to Europe to Africa.<\/p>\n
Where is the money?<\/p>\n
A year later, I read a news item, titled: \u201cIs China withholding funds from Duterte? Beijing’s pledge to deliver $24 billion in aid and investment to the Philippine leader’s government and hometown has failed to come to fruition,\u201d the report said. <\/p>\n
Many experts and analysts had suggested that China might have been withholding the funds until the \u201cbilateral relationship\u201d is firmly consolidated. And most importantly, how the two countries would resolve their territorial disputes in the West Philippine Sea (WPS). <\/p>\n
Okay, so that\u2019s what China had wanted all along. It has always been exploration for oil in the waters off the coast of Palawan, particularly the mineral-rich Recto (Reed) Bank. Think about this: The WPS has an estimated 11 billion barrels of oil, 190 trillion feet of natural gas, and 10 percent of the world\u2019s fishing resources. Isn\u2019t that enough for Xi to drool? If China takes full control of the WPS, her foreign oil imports \u2501 which accounts for 80% of her oil consumption \u2501 from the Middle East and East Africa passing through the Malacca Strait to China would be drastically reduced. That would certainly resolve China\u2019s \u201cMalacca Dilemma.\u201d <\/p>\n
Duterte must have realized then that Xi had taken him for a ride, professing that China was there to help his \u201clittle brother,\u201d which reminds me when Americans used to call the Filipinos, \u201clittle brown brothers.\u201d So, what else is new?<\/p>\n
Slowly, Duterte began shifting back towards America, asking her to provide assistance in combating the threat of international terrorism in his country. Duterte\u2019s move was subtle, but Xi is a master strategist. He has an eye for subtleties. Nobody in his sane mind would loan $24 billion without assurance and a guaranteed collateral. But while \u201cassurance\u201d is cheap and easy to give, \u201ccollateral\u201d is a more serious and complicated situation because it\u2019s not for Duterte to give and he knows it. He has to deal with the Constitution\u2019s restrictions when it comes to sovereignty and territorial integrity.<\/p>\n
Joint exploration<\/p>\n
Another year passed and only two projects were completed: an irrigation project worth $73 million, and two bridges in Manila worth $75 million. That\u2019s a total of only $148 million! What about the remaining $23.852 billion?<\/p>\n
Indeed, the biggest concession that Duterte was willing to give China was a joint exploration of the WPS. But why would he offer such a concession with nothing in return? During his last trip to Beijing, Duterte told Xi, \u201cWe intend to drill oil there, if it\u2019s yours, well, that\u2019s your view, but my view is, I can drill the oil, if there is some inside the bowels of the earth because it is ours.\u201d Xi\u2019s response was: \u201cWe\u2019re friends, we don\u2019t want to quarrel with you, we want to maintain the presence of warm relationship, but if you force the issue, we\u2019ll go to war.\u201d Ooops! That must have scared the hell out of him. He\u2019s been telling everybody, including the Chinese, that the Philippine military would be massacred in a war with China. He was being defeatist; he shouldn\u2019t have said. <\/p>\n
Principled pragmatism<\/p>\n
That left Duterte with one option, which is to use what diplomats call \u201cprincipled pragmatism.\u201d It\u2019s a strategy \u201cdesigned to get maximum results from a delicate situation, without sacrificing anything,\u201d which is done by finding common ground of interest. The idea is to get the most from the country\u2019s aggressor \u2501 China \u2501 without provoking her. <\/p>\n
There is another term for \u201cprincipled pragmatism.\u201d It\u2019s called \u201cshakedown,\u201d which is what organized crime use to extort from business owners. Typically, a couple of mobsters would go to the place of business. They\u2019d accuse the business owner that he is doing business in the mob\u2019s territory. They would then give the owner several options: Relinquish ownership of the business or share the profits. If the owner agrees to share profits, the mobsters will tell the owner that he is now under the mob\u2019s \u201cprotection.\u201d Which reminds me of Xi\u2019s promise to \u201cprotect\u201d Duterte from any plan to remove him from office. <\/p>\n
It did not then come as a surprise when early this year, Duterte proposed a 60-40 split for any joint oil exploration with China. He reasoned, \u201cRather than fight, what can we get?\u201d What he\u2019d get is the Xi\u2019s protection.<\/p>\n
But we don\u2019t have to fight and we don\u2019t have to give up our rights to the WPS either. I happen to believe \u2501 like many Filipinos do \u2501 that China will not go to war against us. That\u2019s the least she would do because she could lose the economic power she had built over the past 40 years. <\/p>\n
Remember also that the Philippines is protected by the U.S.- Philippines Mutual Defense Treaty (MDT). Duterte shouldn\u2019t wait and should begin oil exploration now. To delay it further would only give China more time to build more bases in the WPS and deploy warplanes, missiles, and warships that are within striking distance of the entire country. The Philippines should also consult with the U.S. (her treaty ally), the ASEAN nations, the other claimants to the disputed region, and the other U.S. treaty allies \u2501 Australia, Japan, South Korea, Taiwan, and Thailand. They all share common interest in the region. <\/p>\n
Maybe Duterte should change his belief that \u201cWe cannot win a war with China\u201d and instead adapt the mantra, \u201cNo guts, no glory,\u201d which poker players use effectively. <\/p>\n
At the end of the day, one wonders: What happened to the Philippines\u2019 \u201csweetheart deal\u201d with China? It would have been mutually beneficial without bringing the territorial disputes in the WPS into the overall calculus. But Duterte failed to see beyond the $24-billion loans from his \u201cbig brother.\u201d (PerryDiaz@gmail.com)<\/p>\n","protected":false},"excerpt":{"rendered":"
Two years ago, President Rodrigo Duterte \u2501 freshly installed as president \u2501 went on his maiden trip to China, expecting a grand welcome. And yes, indeed, the Chinese gave him a red-carpet welcome with all the fanfare worthy of royal visitors. For four days, he enjoyed the treatment accorded him. Chinese President Xi Jinping welcomed […]<\/p>\n","protected":false},"author":5,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[52],"tags":[],"_links":{"self":[{"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=\/wp\/v2\/posts\/5302"}],"collection":[{"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=5302"}],"version-history":[{"count":1,"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=\/wp\/v2\/posts\/5302\/revisions"}],"predecessor-version":[{"id":5303,"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=\/wp\/v2\/posts\/5302\/revisions\/5303"}],"wp:attachment":[{"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=5302"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=5302"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.philippinesentinel.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=5302"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}