Bernardo M. Villegas
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Dealing With An Economic Giant (Part 1)

          Philippine political relationships with China are fraught with difficult challenges.  A most recent provocation was the presence of 220 Chinese vessels that were spotted moored at Whitsun Reef last March 7, 2021.  The reef is within the Philippines exclusive economic zone over which our country enjoys the exclusive right to exploit or conserve any resources.  An official diplomatic protest has already been lodged by our Government.   This incident is just another reminder of the tense territorial standoff in which China, the Philippines and four other Governments have been locked over resources, sea lanes and busy waterways for decades.  Former Supreme Court Justice Antonio Carpio described very succinctly the source of this tension in a column in The Inquirer.  He referred to China’s three warfares strategy which China adopted in 2003.  The strategy was meant by the Chinese to seize the South China Sea without triggering a war. 

         To summarize Justice Carpio’s analysis, the First Warfare is a propaganda campaign, declaring to the world that the South China Sea belonged to China since antiquity, claiming that “Chinese activities in the South China Sea date back to over 2,000 years ago.”   The Second Warfare is a blatant intimidation of other coastal states in the South China Sea.  From 2013-15, China built three huge air and naval bases in the Spratlys that project overwhelming military power, intimidating other claimant states into accepting China’s nine-dash line as China’s national boundary in the South China Sea.  The Third Warfare is the legal argument propounded by the Chinese Government that its sovereign rights to the South China Sea predated the 1982 UN Convention on the Law of the Sea (Unclos) which China claims cannot prejudice sovereign rights that had vested prior to 1982.  All these claims have been rejected by the Arbitral Tribunal at the Hague, Netherlands.  As the Tribunal held definitively:  “The Tribunal concludes that China’s claim to historic rights to the living and non-living resources within the ‘nine-dash line’ is incompatible with the Convention…Any historic rights that China may have had to the living and non-living resources within the ‘nine-dash line’ were superseded, as a matter of law and as between the Philippines and China, by the limits of the maritime zones provided for by the Convention.”

         Unfortunately, China decided to completely ignore this final decision of the Arbitral Tribunal. Equally unfortunate was the decision for “pragmatic reasons” of our President Rodrigo Duterte not to work for the enforcement of the decision.  This decision was part of President Duterte’s strategy to “separate from America” and to cling to China instead for economic assistance.  Fortunately, time has shown that China was very good in promising many benefits to the Philippines but very slow in delivering.  The “pivot to China” policy has been replaced with a more realistic balancing act of also turning to other major Northeast Asian economic powers like Japan, South Korea, and Taiwan for the necessary investments and development assistance,  especially in our Build, Build, Build program.  Even the great expectations that the President had about China helping the Philippines in procuring vaccines for the COVID-19 pandemic have led to great disappointments.  It is clear that, as in its Road and Belt initiative with a number of African and Asian countries, its “vaccine diplomacy” has been a ploy to extract the most benefits for China from the so-called beneficiaries.  For the Philippines, as well as the other members of the Association of Southeast Asian Nations (ASEAN) to formulate equally pragmatic strategies on how to deal with the economic giant that China has become in the Indo-Pacific region , it would be wise to understand what are the  fears and anxieties of China  that are behind its leaders’ behavior in throwing their weight around, especially in  the Southeast Asian region. Instead of each complainant confronting China individually, it would be wiser to use their collective resources together to be a counterweight to the tendency of China to bully its smaller neighbors.  Although we must always post a diplomatic protest for every violation of what we consider our rights, we should also be realistic enough to know that China can always completely ignore each one of us.  Only by acting together can we have a ghost of a chance to expect China to act more reasonably.  But first we have to understand why China tends to act the way it does.

           China must be complimented for its great success over the last forty years since the market reforms introduced by Deng Xiao Peng in growing at breakneck speed (averaging at 8 to 10 percent annually in GDP growth) and in reducing its poverty incidence to zero by 2020.  All these admirable accomplishments, however, have been extremely resource-intensive, requiring much of land, forest, water, oil and more or less everything else, as observed by Martin Jacques in his book “When China Rules the World.”  China has only 8 percent of the world’s cultivated land and yet is obliged to support 22 percent of the world’s population.  In contrast, with less than a quarter of China’s population, the United States enjoys three times as much arable land and its farmland has been under human cultivation for one-tenth of the time of China’s.   The development of China over the last forty years is rapidly exhausting whatever limited resources it possesses.  Over this same period, almost half of China’s forests have been destroyed, so that now it enjoys one of the sparsest covers in the world.  Way back in 1993, China became a net importer of oil for the first time and it now depends on imports for around 60 percent of its oil needs. It is clear that China’s most vulnerable point is its lack of resources to continue feeling its aspiration to become a First World economy.  We have to always keep this mind in our dealings with this Goliath our midst.  (To be continued).