Reuters Staff March 21, 2018
BEIJING (Reuters) – China will prudently advance cooperation with the Philippines on joint oil and gas exploration in the South China Sea, China’s top diplomat State Councillor Wang Yi said on Wednesday after meeting his Philippine counterpart.
Any potential deals between Manila and Beijing on energy exploration in the disputed waterway should be agreed with a company and not the Chinese government, a senior Philippine official said earlier this month.
China claims most of the South China Sea, a key trade route and home to areas that are believed to hold large quantities of oil and natural gas. Along with China, parts of the South China Sea are subject to competing claims from Brunei, Malaysia, Taiwan, Vietnam and the Philippines.
The two countries in February agreed to set up a special panel to work out how they can jointly explore offshore oil and gas in areas both sides claim, without needing to address the touchy issue of sovereignty.
Speaking to reporters in Beijing after meeting Philippine Foreign Affairs Secretary Alan Peter Cayetano, Wang said the South China Sea will be turned into a source of friendship and cooperation.
“We will enhance maritime dialogue and pursue equal footed and friendly consultation and in a prudent and steady way advance cooperation on offshore oil and gas exploration,” Wang said, without giving details.
However, pursuing a joint project would be extremely complex and sensitive, as sharing oil and gas reserves could be seen as endorsing the other countries’ claims.
“The Philippines and China are finding a common legal framework to conduct joint exploration and surveys. And with our discussions today I’m confident that we will find a suitable legal framework for our differences,” Cayetano said.
Philippines President Rodrigo Duterte has said China has proposed joint exploration that was “like co-ownership” and better than the two fighting over it.
The Philippines suspended exploration in the Reed Bank in 2014 to pursue a legal challenge to China’s territorial claims.
Included in a 2016 ruling by the Permanent Court of Arbitration in the Hague was a clarification of Manila’s sovereign right to access offshore oil and gas fields, including the Reed Bank, within its 200 mile Exclusive Economic Zone.
The Philippines, China’s CNOOC Ltd (0883.HK) and state-owned PetroVietnam jointly surveyed the Reed Bank from 2003 to 2008.
The Philippines’ ties with China have warmed under Duterte, who has put aside territorial disputes in exchange for trade opportunities and pledged financing for infrastructure projects.
Cayetano said Duterte would visit China next month to attend an economic forum on the southern island province of Hainan and meet Chinese President Xi Jinping.
Reporting by Ben Blanchard, editing by David Evans
Source: Reuters “China says to have ‘prudent’ oil exploration with Philippines”
Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.
In its report “Philippines’ Duterte plays down China military facilities in disputed sea” yesterday, Reuters quotes Philippine President Duterte as saying that China’s construction of military bases on its artificial islands aims at defense against the US rather than confronting its neighboring states.
That is obvious. The construction has been costing China billions of dollars. China’s military has already been much stronger than its neighbors. Shall China have incurred such huge costs to deal with them?
However, Reuters has been trying hard to vilify China by describing China’s nine-dash line as aggression, the construction on the islands as aiming at restricting freedom of navigation in the area and the Court of International Arbitration at the Hague as a UN agency in spite of UN’s denial.
China built the islands to prevent attack by US submarines from the South China Sea when there were obvious danger of that but it refrained from militarizing them to avoid scaring its neighbors. However US Navy’s stupid freedom of navigation operations have provided China with the excuse to militarize them.
Duterte is wise enough to see that, but Philippine pro-US media want to spread false fear among Philippine people to please the US.
Duterte knows clearly that the Philippines cannot rely on the US in its disputes with China over the South China Sea so that it is entirely unable to confront China militarily.
What the Philippines has been fighting for is the rich fishery and energy resources in the South China Sea. China is entirely capable of taking the resources alone as proved by its ban of Philippine fishing at the Scarborough Shoal after the standoff there. The US simply refused to help the Philippines in the standoff as it will not fight for Philippines’ interests.
At the time of the Scarborough standoff, China has not built the artificial islands but the Philippines dared not to confront China militarily without US assistance. That clearly proves that the artificial islands are not necessary for China to deal with its neighbors.
Duterte is wise to become friendly with China so as to enable the Philippine to fish in the area around Scarborough Shoal and share the energy resources with China. Otherwise as China has the military strength and technology to extract the energy resources in the disputed waters alone and the Philippines will simply get nothing.
We shall regard China as generous to allow the Philippines to share the resources that China is wholly entitled to.
China has thus proved that it wants its relations with other countries to be mutually beneficial. That is why in spite of Western media’s vilification China is and will be more popular in the world.
The situation in the South China Sea now is:
China will be able to get the resources in the areas without disputes. In the areas with disputes, it will share with other claimants;
China has built and militarized its artificial islands sufficiently to make the South China Sea its lake; and
The US is unable to attack China with its navy and has to spend billions of dollars for development of new bombers to attack China.
US media such as the Reuters are unhappy with the situation, but they can do nothing except vilifying China. However, as China grows increasingly popular, they will become increasingly unpopular due to their unfounded vilification.
Comment by Chan Kai Yee on Reuters’ report, full text of which can be found at https://www.reuters.com/article/us-philippines-china-southchinasea/philippines-duterte-plays-down-china-military-facilities-in-disputed-sea-idUSKCN1G31KQ.
Reuters Staff January 15, 2018 / 8:34 PM / Updated 14 hours ago
MANILA (Reuters) – Philippine President Rodrigo Duterte personally made a decision to let China conduct scientific research off the Philippines’ Pacific coast, his spokesman said on Monday, despite concern among critics about threats to maritime sovereignty.
Presidential spokesman Harry Roque said that as chief architect of foreign policy, Duterte allowed China to work with the University of the Philippines in Benham Rise, an area roughly the size of Greece and believed by some scientists to be rich in biodiversity and tuna.
The United Nations declared Benham Rise, off the Pacific coast, part of the continental shelf of the Philippines in 2012. Manila last year renamed it the “Philippine Rise”.
Though China does not lay claim to the area, the lingering presence of its vessels for several months in late 2016 triggered concern about its intentions.
The Philippines granting of the permission to China was not announced and was revealed a few days ago by a lawmaker who has been fiercely critical of Duterte’s close ties with Beijing.
The Philippines and China have a long history of maritime squabbles over sovereignty in the South China Sea, but there has been no disagreement about waters off Manila’s Pacific coast.
Roque said anyone opposed to the joint research project should go to Congress and raise the issue there.
“If this is not a wise move of the president, then a law could be enacted to prohibit it,” he said.
The Philippines would grant permission to any other country that might show interest in conducting maritime research at Benham Rise, he added.
Reporting by Manuel Mogato; Editing by Martin Petty, Robert Birsel
Source: Reuters “Philippines’ president made call on China’s sea research – spokesman”
Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.
In SCMP’s article “Willingness to explore resource sharing points to cooperative future for China, the Philippines”, the writer Richard Heydarian, a Manila-based academic and author, says “peaceful dialogue over resource sharing in disputed areas could in itself contribute to improving diplomatic relations among competing neighbours.”
However, he points out the seemingly insurmountable obstacles including Philippine constitution and popular nationalism so that former Philippine President Gloria Arroyo failed in her attempt for such sharing.
Mr. Heydarian fails to see that situation is different now. Before Philippines’ failure to get its ally’s help in countering China in the Scarborough standoff and imposing Hague arbitration award, the Philippines still has the illusion that with the help from China’s rival and its long-term ally the US, it can be benefited from the resources in the disputed waters fully alone.
Now, without Chinese consent, it cannot even exploit the fish resources in the disputed waters claimed by it. It simply cannot exploit the energy resources without cooperation with China, but China has the technology, equipment, funds and military strength to exploit the resources alone without any sharing with other claimants. What if China extracts all the resources alone? No one can help the Philippines to prevent that. Neither the US, ASEAN or the permanent court of arbitration at the Hague can.
Therefore, the Philippines has no alternative but share the resources with China or it will get nothing.
Its current president Duterte is wise to see that, but his people perhaps do not realize that and would rather give China the opportunity to enjoy the resources entirely alone.
Comment by Chan Kai Yee on SCMP’s article, full text of which can be found at http://www.scmp.com/comment/insight-opinion/article/2108202/willingness-explore-resource-sharing-points-cooperative.
SCMP says in its report “No South China Sea trade-off for economic gains, Philippines says”:
Manila pursues twin track with Beijing, separating maritime disputes from finance and trade ties
Manila is unlikely to compromise on its maritime sovereignty despite Beijing’s chequebook diplomacy and economic inducements, according to the Philippines’ finance chief.
In an exclusive interview with the South China Morning Post, Philippine Secretary of Finance Carlos Dominguez said Manila was trying to protect its interests by separating maritime disputes from its efforts to woo Chinese investment.
Putting aside the dispute and conducting win-win cooperation in resource exploitation is precisely what China wants so that what Manila has been doing precisely plays into China’s hands.
SCMP says that other claimants especially Vietnam is unhappy, but what can they do?
With China’s strong military and artificial islands and the US unwilling to fight China for other claimants’ interests the South China Sea is already China’ lake. Other claimants can do nothing even if China wants to have all the resources there alone. They must regard themselves as lucky that China is willing to share as China has a tradition of being friendly to its neighbors.
Be realistic to cooperate with China. There is no other ways out for other claimants as the US is unwilling and unable to fight for them.
If China has grown even stronger and the US continues its decline, they may even lose the chance to have a share of the resources in the South China Sea. No one can ensure that China’s future leaders will continue Chinese current leaders’ policy of détente.
What if Chinese military drives away all other claimants from the islands and reefs claimed by China as its territories but occupied by others? What if China conducts resource exploitation alone with the technology and equipment other claimants cannot afford and with the protection of Chinese navy and air force?
Think about that.
Comment by Chan Kai Yee on SCMP’s report, full text of which can be found at http://www.scmp.com/news/china/diplomacy-defence/article/2105582/no-south-china-sea-trade-economic-gains-philippines.
Philippine President Duterte is wise to accept China’s offer to conduct win-win cooperation in exploiting the rich energy resources in disputed waters.
His predecessor former President Aquino tried to get the resources alone not only he energy but also the fishing resources. He sent Philippine navy to round up Chinese fishing boats in order to prohibit Chinese fishing in the disputed Scarborough Shoal and thus gave rise to a standoff with China.
Aquino thought that Philippines’ ally the US would have sent its powerful navy to drive away Chinese warships since what he did was helping the US contain China, which was precisely the aim of US President Obama’s pivot to Asia. Unfortunately for him, the US would fight for the Philippines. Instead, it told Aquino to withdraw and seek remedy from an arbitration.
Aquino did get a favorable arbitration award that completely deny China’s historical sovereignty and rights and uphold Philippines rights to the area it claims as its special economic zonearea. However the arbitration court is not a UN agency. It award has no binding force unlike the verdict of the International Court, a UN agency.
Moreover, even if Aquino had got a favorable verdict from the International Court, he could have sought remedy at the UN Security Council. However, as China has veto power there, Aquino could not have got anything even if he had been able to obtain such a verdict.
Aquino’s successor President Duterte was soon able to make a clear analysis of the situation. Since China will fight to protect its sovereignty and rights to the disputed waters and the US is unwilling to fight to help the Philippines impose the arbitration award, the only way out for the Philippines is to recover Aquino’s predecessors’ friendship with China and begin cooperation with China in exploiting the resources in the disputed waters.
China is growing increasingly strong while the US is declining. If China has overwhelming superiority to the US and a future Chinese leader refuses to share the natural resources with the Philippines, the Philippines will get nothing.
After all China has the technology and equipment to exploit the energy resources there while the Philippines has none. It has to draw in a foreign partner to exploit the resources but who would like to take the risk to upset China when China has become that extremely strong?
SCMP’s report “Beijing defends East China Sea activities after Japan protests” yesterday proves Duterte’s wisdom.
SCMP says that China is busy conducting exploration of energy resources in the area that claimed by both China and Japan. Japan protests but China simply ignore the protest and insists that the area is indisputably under China’s jurisdiction.
What can Japan do? Nothing except protesting. The US is Japan’s ally with relations much closer than with the Philippines would not send its navy to help Japan in its confrontation with China. Therefore, if Japan is not willing to conduct win-win cooperation with China in exploiting the resources, it can only watch helplessly till China has exploited all the energy resources there.
Comment by Chan Kai Yee on SCMP’s report, full text of which can be found at http://www.scmp.com/news/china/diplomacy-defence/article/2105153/beijing-defends-east-china-sea-activities-after-japan.
SCMP says in its report “Philippines hails new rapport with China as key to economic growth amid ‘realistic and practical’ approach to South China Sea” today, “The Philippines’ trade minister is predicting economic ties with China will grow faster than ever as the island nation sets aside their maritime border disputes, signalling a sea change from Manila’s confrontational approach to diplomacy initially under a tough-talking new president.”
“As the Philippines’ target for GDP growth was an ambitious 7 to 8 per cent in the coming five years, Lopez (the minister) said, China would be the key force to help his country achieve that. He pointed to the 34 per cent year-on-year growth of exports from the Philippines to the mainland and Hong Kong from January to May.”
It proves my belief that win-win cooperation is much better than confrontation.
Comment by Chan Kai Yee on SCMP’s report, full text of which can be found at http://www.scmp.com/news/hong-kong/politics/article/2102244/philippines-hails-new-rapport-china-key-economic-growth-amid.