Philippine and American troops are set to hold naval exercises this month near a disputed shoal that will almost certainly anger China with tension already high in the South China Sea.
China claims 90 per cent of the South China Sea, which is potentially rich in oil and gas and fisheries.
The Philippines, Malaysia, Brunei, Vietnam and Taiwan also claim parts of the waters, and China has viewed with suspicion what it sees as US moves to "provoke" tension by supporting its regional allies, notably Vietnam and the Philippines.
Five warships, including a US guided-missile destroyer, and about 1,000 troops will take part in the week-long Cooperation Afloat Readiness and Training (Carat) exercises, which include live-fire drills 64km off Zambales, on the western shores of the Philippine island of Luzon.
The drills are to be held about 80 nautical miles from two or three ships of the Chinese coastguard that are stationed off the disputed Scarborough Shoal. China seized control of the shoal from the Philippines in 2012.
The US economic and strategic rebalancing to the Asia- Pacific region has prompted China to become more assertive, according to Marc Faber, publisher of the Gloom, Boom & Doom report, speaking at a forum in Ho Chi Minh City.
"You have to put yourself in the chair of a Chinese leader," Faber said. "You depend on oil imports from the Middle East. They're vulnerable in the Strait of Malacca. They're vulnerable up to the northern ports of China because they're all surrounded by naval and military bases of America that have a security agreement with Japan. So of course you want to make sure that the access to the oil will always be there."
In January 2013, the Philippines went to an arbitration court in The Hague to question China's "excessive" policy in the South China Sea, hoping the court would order China to pull its ships away from the rocky outcrop.
The exercises were aimed at strengthening the capabilities of both sides in amphibious operations, special operations and surface warfare, besides enhancing information-sharing, Philippine navy spokesman Lieutenant Rommel Rodriguez said.
Rodriguez said the drills were a regular annual event.
"They'll have targets at sea, called 'killer tomatoes'," he said, referring to the live-fire exercise. "All ships will aim at the hostile objects. Then they will take turns to fire their guns."
The USS Halsey, an Arleigh Burke-class missile-guided destroyer, will dock in the Philippine port of Subic Bay next Thursday for the exercises. It will be joined by the Safeguard and the Ashland.
Manila will send the Ramon Alcaraz, a former US coastguard cutter, and the Emilio Jacinto, a former Hong Kong-based British Royal Navy ship, for the drills, along with Polish-made helicopters.
Additional reporting by Bloomberg