China, Philippines to Cooperate on Oil, Gas Exploitation in Disputed Sea


SCMP says in its report “China-Philippine relations ‘never been better’, says ex-president Gloria Arroyo” that during Chinese President Xi Jinping’s just finished visit to the Philippines, the two countries signed 29 deals including a memorandum of understanding to cooperate on oil and gas development in the South China Sea.

Preceding his visit to the Philippines, Xi visited Brunei and agreed with it “on further win-win cooperation in exploiting oil and gas resources in the disputed South China Sea”, according to SCMP’s report “China and Brunei to step up oil and gas development in disputed South China Sea” on November 19.

I said in my comment on SCMP’s that report titled “China Solving South China Sea Disputes by Oil, Gas Exploitation Cooperation” on November 20:

Xi is to visit the Philippines today and may conclude some agreement on cooperation in exploiting oil and gas with the Philippines. As Vietnam and Malaysia also have similar desire on cooperation with China, there are prospects that China’s disputes with its neighbors over the South China Sea will be resolved peacefully through win-win cooperation.

Some may think Philippine current president Duterte’s pro-China strategy is exceptional, but Philippine former president and present speaker of House of Representatives Arroyo precisely adopted a similar pro-China strategy in her nine years as Philippine president until 2010.

During the nine years, the Philippine also cooperated with China on oil and gas development with a US$15 million deal – known as the Joint Maritime Seismic Undertaking – to jointly conduct seismic prospecting for oil in the sea. The deal was later joined by Vietnam.

Arroyo’s successor former President Aquino, instead, is an exception. He tried to exploit US pivot to Asia to deny China’s rights and interests in the South China Sea with US military support, but failed in disgrace. He makes Duterte’s pro-Beijing strategy popular as his failed speculation showed that the US does no care about its ally’s interests. Though Philippines’ military ally, the US is not willing to fight for Philippines’ interests.

That make Duterte’s policy of dumping the US popular among Philippine people.

In fact, Philippine elite knew US selfishness long ago as shown by their driving away of US military bases in the Philippines in the 1990s.

The US believes that it is popular in the Philippines. Duterte’s popularity proves precisely the contrary.

China is popular among developing nations as it respects them, cares for their interests and is generous in providing financial aids for them

SCMP’s another report today “Faced with a mounting economic crisis, the cash-strapped Maldives is looking to renegotiate its piles of Chinese debt” proves precisely that. Its title tries to make readers believe that Maldives is in China’s debt trap, a term Western countries use to demonize China.

The fact reflected in the report proves the contrary.

SCMP quotes China’s ambassador as telling the local Avas.mv website that in fact only about half of the Maldives’ external debt pile of US$1.2 billion was owed to Beijing.

He said the loans carried an interest rate of 2 per cent and a five-year grace period, while also disputing claims of a debt trap.

“We have nothing to gain if a friendly country falls into debt,” he said. “There is no single (piece of) evidence to support the so-called debt trap claim.”

In spite of the busy demonizing by Western politicians and media, China remains popular as it pursues win-win cooperation with other nations. And in spite of US boasting of its so-called good intention to help other nations, the US remains unpopular due to its arrogant invasion of Iraq, Afghanistan, etc. interference in other countries’ internal affairs by causing regime changes and exporting its democracy that does not bring prosperity and unity even in its own country.

Comments by Chan Kai Yee on SCMP’s reports, full text of which can respectively be viewed at https://www.scmp.com/news/china/diplomacy/article/2174384/china-philippine-relations-never-been-better-says-ex-president and https://www.scmp.com/news/asia/south-asia/article/2174413/faced-mounting-economic-crisis-cash-strapped-maldives-looking.

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US Helps China Get Consensus with ASEAN on Code of Conduct


Reuters says in its report “ASEAN, China agree ‘milestone’ text as basis for South China Sea talks” on August 2, “Southeast Asian nations and China have reached a “milestone” in talks with China over a code of conduct in the South China Sea with a working text that will serve as a basis for future negotiations, Singapore’s foreign minister said on Friday.”

The US helped the Philippines obtain a favorable arbitration award to deny China’s historical rights and interests, but the Philippines cannot enforce it as the UN immediately declared that the arbitration court was not a UN agency so that the Philippines cannot seek remedy from the International Court of the UN.

The US sent two aircraft carrier groups to scare China so as to force it to accept the award, but China challenged the US to war. Having no geographical advantages in a war near China, the US refused to fight.

China, though has military superiority over not only its neighbors but also the US in the areas near China, prefers win-win cooperation to jointly exploit the natural resources in the South China Sea.

In fact, China is entirely able to exploit the resources alone as no one even the US can stop it. The Scarborough standoff is a good example. The Philippines sent its navy to ban Chinese fishermen fishing there. China sent its navy to drive away Philippine fishing boats and had the fish resources exclusively. The US simply refused to help the Philippines so that Philippine fishermen could not fish in the sea area around the shoal until its new president Duterte had improved relations China.

Yes, all claimants want to exclusively have the resources they claim except China who is willing to share through win-win cooperation. Since they cannot rely on US help to get the resources exclusively, they shall think themselves lucky to be able to conduct win-win cooperation with China. That is why smooth progress has been made in having consensus on the code of conduct so quickly.

Comment by Chan Kai Yee on Reuters’ report, full text of which can be viewed at https://www.reuters.com/article/us-asean-singapore-southchinasea/asean-china-agree-milestone-text-as-basis-for-south-china-sea-talks-idUSKBN1KN14V.


Do Not Look Down on Weak Philippines!


In my post “Weak Philippines Will Fight China but Powerful US Won’t in SCS! Why?” yesterday, I showed that I believe that Philippine President Duterte is serious in setting the red lines which if China has crossed, the Philippines will fight a war with China. Why? Because it involves too high interests as the energy resources are too valuable for the Philippines.

The Philippines, though weak, its people are brave. Do not look down on them. Lots of US troopers have been killed by Iraqi resistant Islamic extremists who have even established an Islamic state. If China occupies the Philippines, it will encounter similar trouble as Philippine people will be resourceful to find clever ways of resistance.

However, China is certainly not so stupid as the US and European colonists who tried to conquer the Philippines but failed at the end.

SubChina certainly does not believe that Duterte was serious in seting the red lines as it puts a question mark in title of its report “Duterte’s red line?”

Do not look down on weak people. US suffered defeats due to its arrogance. Korean War, Vietnam War, 911 (which could have been prevented if US President Bush had not refused to pay attention to the warning from US intelligence due to his arrogance. He was so arrogant as to believe that the US was capable of fighting two wars simultaneously!) and ISIS still could not wake the US up from its arrogant dream of being an invincible hegemon. Trump seems arrogant but he is really not arrogant so that he has not really started a trade war with China or attacked North Korea but US Congress remains so.

China shall learn lessons from the failures of European and American colonists and never try to conquer or control other countries; therefore, Chinese President’s Belt and Road win-win cooperation is China’s best strategy of economic expansion.

Comment by Chan Kai Yee on SubChina’s report, full text of which can be viewed at https://supchina.com/2018/05/29/is-duterte-serious-about-a-south-china-sea-red-line/


Weak Philippines Will Fight China but Powerful US Won’t in SCS! Why?


The Philippines will fight for the rich natural resources it claims in the South China Sea (SCS) but the US has no claim at all why shall it fight? The US is only interested in freedom of navigation there, which China won’t fight to hinder even though US warships enter China’s territorial waters.

Now according to SCMP’s report “Philippines’ Rodrigo Duterte will go to war with China if it crosses ‘red lines’ and claims disputed resources, Philippine foreign ministry warns” today, Philippine Foreign Secretary Alan Peter Cayetano has declared President Duterte’s “red lines” that China shall not exploit natural resources alone in the area of dispute between the Philippines and China. Otherwise the Philippines will fight to protect its interests. As China, though much stronger, has the wisdom that it has to share the resources with other claimants to avoid trouble in the future there will not be such a war. In fact, it is a realistic and fair way to resolve the disputes for both countries.

Both China and the Philippines know that neither of them is able to have the resources alone. Better to be friends in sharing the resources than eternal enemies in taking the resources alone by relying on one’s strength at present.

However, I remain confident to say that SCS is now China’s lake as China will have the rich resources in the vast non-disputed areas entirely alone. If the areas are international waters, other country will come to exploit the resources. The US certainly dare not do so as China has military dominance there. With the three airstrips in its artificial islands in SCS, China can deploy at least 600 warplanes there. Together with the warplanes, radars and other surveillance and command centers on its shore, it has overwhelming military superiority.

Chinese sage Mencius says, “Timing is not as good as geographic advantages, geographic advantages, popular support”.

The US will have no popular support as its people simply will not support a war US interests are not involved. It has no geographic advantages at all as all its ground support facilities are too far away and within the range of Chinese intermediate missiles.

The Philippines will have popular support if it fights for its national interests, though its troops are much weaker. So the Philippines may fight but the US may not.

As for timing, it is certainly not the right timing as the US as it is having troubles elsewhere in Europe and the Middle East, while China has no such trouble at all.

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/2148204/philippines-rodrigo-duterte-will-go-war-china-if-it.


Philippines verifying photos of China military aircraft on reef


Reuters Staff April 18, 2018

MANILA (Reuters) – The Philippines may lodge a protest with China against the reported presence of two military aircraft on a Chinese-built island in the South China Sea, the top Philippine diplomat said, amid concern that China is militarizing the waterway.

The Philippine Daily Inquirer published pictures on Wednesday that it said showed two military transport aircraft on the tarmac of Mischief Reef, which the Philippines claims.

The reef is the closest of the artificial islands that China has developed to the Philippines, and within its 200 nautical mile exclusive economic zone.

The newspaper said the photos were taken in January this year. Reuters could not verify the authenticity or date of the pictures.

Foreign Affairs Secretary Alan Peter Cayetano told reporters the defense and military establishments had been asked to confirm the presence of the aircraft, after which the Philippines could ask China to explain it.

“Filing a protest is one of the diplomatic actions being considered, pending a confirmation from the defense department,” Cayetano said, adding the Philippines has proposed claimants reverse defense enhancements in the Spratly islands.

“Many claimants are putting embankments, radar, and other defensive mechanisms, the challenge now is how to stop it and roll it back,” he added.

China claims almost the entire South China Sea, a strategic waterway where about $3 trillion worth of sea-borne goods pass every year. Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have conflicting claims in the sea.

The Inquirer showed what it said were surveillance photos obtained from an unnamed source, showing what appeared to be two Xian Y-7 transport planes.

The military declined to comment and China’s embassy in Manila did not respond immediately to a request for comment.

China’s Defence Ministry also did not immediately respond to a request for comment.

Cayetano said claimants were talking to each other as well as “non-regional players” to resolve disputes and avoid a regional arms race.

China and Southeast Asian countries started negotiations in Vietnam last month on a code of conduct in the South China Sea, starting with “less sensitive and less controversial” issues, he said.

Cayetano said they had identified common issues before discussing contentious provisions, such as whether the code would be legally binding and include sanctions against offenders.

He said there was no time frame for conclusion and adoption of the code.

The drafting of the code has been met with widespread scepticism, with some experts convinced China’s uncharacteristic support for it is aimed at placating Southeast Asian states while buying time to completes its military installations in the sea.

Reporting by Manuel Mogato; Editing by Martin Petty, Robert Birsel

Source: Reuters “Philippines verifying photos of China military aircraft on reef”

Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


China says to have ‘prudent’ oil exploration with Philippines


REFILE – CORRECTING HEADLINE Philippine Foreign Affairs Secretary Alan Peter Cayetano, left, passes on a hand-written letter from President Rodrigo Duterte to Chinese President Xi Jinping during a meeting with Chinese Foreign Minster and State Counselor Wang Yi, right, at the Diaoyutai State Guesthouse in Beijing, China March 21, 2018. Parker Song/Pool via REUTERS

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.


Duterte Wise to See China’s Militarization of Islands Directed at US


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.