A Blow to China’s Belt and Road Initiative by the Philippines
The Philippines’ latest decision to terminate significant Belt and Road Initiative, infrastructure projects underscores a substantial transformation in its relationship with China and this signifies a decline in China’s influence in the region. This abrupt shift marks a departure from the previous era of warmth and cooperation experienced during President Rodrigo Duterte’s pro-Beijing leadership, revealing a growing divide between the two nations. Critics have labeled China’s approach as “pledge trap” diplomacy, characterized by grand promises of substantial investments in exchange for concessions. However, the reality fell far short of expectations, as a substantial portion of the promised $24 billion in infrastructure projects never materialized. The Philippines’ withdrawal from the belt and road initiative can be traced back to the longstanding territorial disputes in the South China Sea, which have intensified in recent times, raising concerns about security and sovereignty. In response to these challenges, the Philippines is now actively seeking alternative partnerships with traditional allies such as Japan, South Korea, the United States, and the European Union, aiming to secure more favorable terms and diversify its support base.
China’s Belt and Road Initiative has experienced a significant decline, with BRI related operations plummeting by approximately 40% since their peak in 2018. This downturn is driven by a combination of factors, including legislative hurdles, financial challenges faced by recipient nations, and China’s dwindling financial commitments. Many countries that have received Chinese finance now find themselves grappling with significant debt distress, prompting China to bail out BRI recipient nations facing potential bankruptcy. Concurrently, there has been a noticeable shift in bilateral investment deals between China and the Philippines, reflecting mounting geopolitical concerns and a sense of unease about China’s economic slowdown, property market crises, and the risks associated with overseas investments. While China maintains a trade advantage, most of the infrastructure investment commitments made during the Duterte administration are now hanging in the balance, as the Philippines cautiously diversifies its foreign relations. This move raises questions about whether Japan, the United States, South Korea, and the European Union will step in to fill the infrastructure gap that China had once promised to address. In the context of “How China lost the Philippines,” these developments underscore China’s waning influence in a country that was once seen as a key partner in its global ambitions.
Centuries of China-Philippines Connections
The complex, centuries-long relationship between China and the Philippines has been characterized by cultural exchanges, trade, diplomacy, and shared history. Ancient Chinese traders navigated the intricate waters of the Philippine archipelago, fostering the exchange of goods, ideas, and technology. This historical interaction has left a lasting imprint on both nations, shaping their cultural and economic ties. During the colonial era, Chinese immigrants played a vital role in Filipino society, and contributed to the unique blend of cultures that is evident today in languages, cuisine, and traditions. The Philippines’ resilience during World War II, particularly the unity of Chinese and Filipino communities in resisting Japanese occupation, solidified their bond. Despite these historical connections, the two nations now find themselves at odds over territorial disputes in the South China Sea.
The Legacy of Spanish and American Colonialism in the Philippines
The Philippines’ historical narrative commences with the arrival of Ferdinand Magellan in 1521, representing the Spanish crown, and marking the start of the country’s colonial era. This period spanned over three centuries, marked by challenges such as confrontations with Chinese pirates, Dutch and Portuguese incursions, and local uprisings. The Philippines became a hub for trade with Spain, particularly through the Galleon Trade, initiated in 1565, which served as a crucial trade route connecting Asia to Mexico. As the years passed, the Philippines diversified its sources of income, including the cultivation of tobacco.
The late 1800s witnessed the emergence of a reform and independence movement, led by notable figures like Jose Rizal. However, this era also saw escalating tensions that culminated in the Spanish-American War of 1898, leading to the United States’ victory and its assumption of control over the Philippines. This period saw extensive conflicts, with substantial Filipino casualties. Later on, following the World War II, the Philippines finally achieved independence from the United States in 1946.
China’s Assertiveness in South China Sea Region and the Philippines
China’s assertiveness in the South China Sea has evolved over time, with its actions impacting regional stability and relations with the Philippines. This assertiveness escalated since the 1970s when the South China Sea gained prominence as a crucial trade route and a potential source of valuable oil and gas resources.
Historically, China’s focus in the South China Sea is centered on the contested islands within the region. However, in 1973, China began asserting broader administrative rights over the surrounding waters, particularly as it became involved in negotiations for the UN Convention on the Law of the Sea (UNCLOS). Although China signed UNCLOS in 1982 and ratified it in 1996, it continued to exert control over the areas, asserting claims of absolute sovereignty over the Nansha (Spratly) Islands and adjacent waters and resources. In 1987, China established its presence in the Spratly Islands, and in 1992, as UNCLOS neared international law status, its assertiveness surged.
China’s evolving approach to the South China Sea became notably assertive in 2007, signifying a significant policy shift. During this pivotal year, China obstructed oceanic research efforts by countries like Vietnam and the Philippines, employed intimidation tactics against foreign oil companies collaborating with Vietnam in disputed areas, and confronted a U.S. spy ship, citing sovereignty concerns and demanding its departure. This shift was accompanied by an administrative expansion, characterized by increased patrols and the construction of artificial islands in the disputed territories.
Once again, tensions flared further in 2012 when China’s standoff with the Philippines at Scarborough Shoal marked a turning point. The occurrence and subsequent measures taken by China, including the construction of artificial islands in the vicinity of Scarborough Shoal within the South China Sea, escalated tensions in the region. In response, the United States, France, and the United Kingdom initiated freedom of navigation operations. These actions were undertaken not only to safeguard their rights in the global commons but also to lend support to the littoral states navigating the contested waters.
The Philippines, in response to China’s assertiveness, pursued legal avenues, culminating in a tribunal established under UNCLOS ruling against China’s maritime claims in 2016. However, China rejected the tribunal’s decision, emphasizing its military power and downplaying the need for legal resolutions on the basis of might is right. The years that followed saw ongoing disputes over contested areas in the South China Sea and various actions by Chinese Coast Guards to assert control over these waters.
The End of Duterte’s China-Friendly Policy
The Philippines’ foreign policy underwent a significant transformation during President Rodrigo Duterte’s tenure from 2016. Duterte’s initial overtures to Beijing were characterized by declarations of distancing from Washington. However, Duterte’s foreign policy exhibited a degree of inconsistency and shifting stances over time. By 2021, he initiated a pivot back towards the United States, prompted by a confluence of factors. These factors included China’s inability to fulfill its promises of the belt and road initiative fundings, escalating territorial tensions, and mounting security concerns in the South China Sea. In response to these evolving geopolitical dynamics, the Philippines embarked on a process of rebuilding trust and revitalizing its security relationship with the United States.
A Shift towards the United States
Realignment with the United States manifested on multiple fronts, propelled by various factors. Public opinion played a pivotal role in this, as a 2022 Pew Research Center survey revealed that 77% of Filipinos viewed the United States favorably, while only 21% expressed a positive sentiment towards China. On the military front, the Philippines and the United States bolstered their cooperation, conducting joint military exercises like the substantial Balikatan exercises, which have become the largest annual bilateral military drills in the Indo-Pacific region. Notably, the Enhanced Defense Cooperation Agreement (EDCA) granted the United States access to Philippine military bases, enhancing their strategic cooperation. Economic ties between the two nations deepened, with the United States ranking as the Philippines’ third-largest trading partner and a major source of foreign direct investment. The year 2022 saw the signing of two significant trade agreements, the Trade and Investment Framework Agreement (TIFA) and the Digital Trade Agreement (DTA). Moreover, the renewal of the Visiting Forces Agreement (VFA) in 2021 enabled the continued presence of U.S. military visits and exercises within the Philippines, while the Mutual Logistics Support Agreement (MLSA) signed in 2022 empowered both countries to provide logistical support to each other during military operations. Building on this foundation, 2023 witnessed the Philippines and the United States agreeing to increase the number of U.S. troops stationed in the Philippines.
The Philippines’ deepening commitment to the United States, underpinned by the Mutual Defense Treaty, has cast a spotlight on the disappearing influence of China on Philippine. The historic treaty, solidified in 1951, stipulates mutual defense in the face of an armed attack. Against the backdrop of escalating tensions between the United States and China, President Ferdinand Marcos Jr. is voicing apprehensions regarding the looming prospect of a military conflict between the two nations and the potential entanglement of the Philippines in such a scenario. Both countries have activated new Enhanced Defense Cooperation Agreement sites. Additionally, both countries are dedicated to strengthening regional alliances, fostering partnerships with Japan, members of the AUKUS trilateral security partnership between Australia, the United Kingdom and the United States and with fellow ASEAN nations.
The annual Balikatan military exercises serve as a tangible expression of the Philippines’ commitment to integrating the U.S. security alliance into its broader regional network, solidifying a renewed and forward-looking strategic posture. However, on the other side, the heightened temperatures in the South China Sea, especially between China and the Philippines signify the fact that China is losing the Philippine in the geopolitical chessboard because of its assertive actions and the decision of the Philippines to exit Chinese flagship project is its manifestation.
End note
In conclusion, the Philippines’ decision to terminate major Belt and Road Initiative (BRI) infrastructure projects represents a pivotal moment in the context of how China lost influence in the Philippines. This development reflects a significant departure from the warmth and engagement experienced during President Rodrigo Duterte’s pro-Beijing presidency, underscoring a deepening rift between the two nations. China’s “pledge trap” diplomacy, characterized by grandiose investment promises in exchange for South China Sea concessions, failed to materialize as expected, contributing to the Philippines’ disillusionment with its northern neighbor. The Philippines’ pivot towards traditional allies like the United States, Japan, and other partners highlights the diminishing influence of China in the Philippines. This shift is amplified by the historical and cultural connections between China and the Philippines, complicated by the complex history of colonialism and the evolving assertiveness of China in the South China Sea. In the face of ongoing territorial disputes and shifting geopolitical dynamics, the Philippines’ strategic recalibration exemplifies the broader challenges faced by China in retaining its influence in the Asia-Pacific region, underscoring a significant chapter in how China lost the Philippines.
