As Beijing and Manila shake hands on South China Sea energy deal, backlash from Filipino critics begins

Manila defended its newly signed joint energy exploration deal with Beijing in the disputed waters of the South China Sea, after critics said the move undermined an international tribunal ruling in favour of the Philippines.

After a red-carpet welcome for Chinese President Xi Jinping at the Malacañang Palace in Manila on Tuesday, the two sides signed a memorandum of understanding for joint oil and gas development in the contentious waters, in another sign of Manila’s warming ties with Beijing under President Rodrigo Duterte.

The agreement comes at a time of intensifying tensions between China and the United States – a defence treaty ally of the Philippines – that have gone beyond their trade war to clashes over Chinese militarisation of the South China Sea.

In a joint statement released on Wednesday, the nations said the South China Sea dispute should not affect their cooperation.

They said the disputes should be resolved through peaceful negotiations among the claimants – a veiled reference to the US – and no side should resort to violence. Both nations should exercise restraint to avoid letting the disputes escalate.

Duterte said at the Asean regional summit in Singapore last week that China was “already in possession” of the South China Sea, so it made more sense to work with it in the resource-rich waters rather than create frictions.

“China is there,” he told reporters. “That is a reality, and America and everybody should realise that they are there.”

As Manila pursues an “independent foreign policy” that seeks to balance between the greater powers, Duterte argued that if tensions in the South China Sea result in war, the Philippines “will be the first to suffer”.

In May, then Philippine foreign secretary Alan Peter Cayetano, struck a bullish tone, saying: “Nobody can extract natural resources there on their own. The president has declared that. If anyone gets the natural resources in the West Philippine Sea-South China Sea, he will go to war.”

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Duterte’s government said territorial disputes would not have to get in the way of joint development, and the Philippine leader insisted it would have to be advantageous to the country to move forward.

It also remains to be seen how the joint exploration deal will fit into Manila’s “independent foreign policy”, with analysts envisaging more difficulty for the Philippines to avoid becoming collateral damage as tensions escalate between China and the US, including in the South China Sea.

“If you’re talking about spillovers … the South China Sea is going to be the arena where those geopolitical issues are going to play out,” Herman Kraft, a political-science professor at the University of the Philippines Diliman, said.

Philippine opponents of the joint exploration deal argue that Duterte’s rapprochement with Beijing has prioritised major infrastructure agreements – the two sides signed 29 deals on Tuesday, some including more Chinese funding – at the expense of the southeast Asian nation’s interests in the South China Sea.

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In 2016, under the administration of Duterte’s predecessor, Benigno Aquino, Manila won a lawsuit at an international court that invalidated Beijing’s “nine-dash line” claims to more than 80 per cent of the waters after the two countries engaged in a stand-off at Scarborough Shoal – about 200km (124 miles) west of the Philippines port of Subic Bay on Luzon island – in 2012.

Opposition politicians called for an investigation into proposed joint exploration, with Senator Antonio Trillanes IV publishing a two-page agreement ostensibly drafted by the Chinese side. The draft proposed the establishment of a joint steering committee and working group to forge the deal in the waters Manila officially terms the West Philippine Sea, an area both governments claim.

“The joint oil and gas exploration shall not affect the respective position on sovereignty and maritime rights and interests of the two parties,” the draft document said, indicating China authorised China National Offshore Oil Corporation to take part in the joint exploration.

But current Foreign Minister Teddy Locsin Jnr insisted on Twitter that he alone wrote the agreement signed on Tuesday, “without consulting the so-called Chinese draft”.

“Wrote one entirely out of whole cloth, and it is impossible to attack and irresistible to praise for its sheer breathtaking elegance,” he wrote.

Environmental groups and campaigners criticised the deal for jeopardising the biodiversity of the West Philippine Sea, the livelihood of Filipino fisherfolk in the area, and the 2016 arbitration ruling. In recent years, Beijing has been increasingly assertive in the South China Sea, including building artificial islands and militarising the areas it claims.

“China cannot just draft a framework agreement concerning our sovereignty and impose it to the Philippines,” fisherfolk group Pamalakaya Pilipinas, which represents for more than 100,000 people in the industry, said. “There can never be mutual respect and benefits in the joint venture when China was the one who crafted the framework agreement.”

Fernando Hicap, the group’s chairman, said the fisherfolk felt their situation was deteriorating under the Duterte administration – a government widely criticised for its policy of extrajudicial killings, with six leaders in their organisation killed in the past two years.

“Things are getting worse for us, but we are not afraid,” he said. “The fisherfolk have nowhere to go, but to ask for their rights.”

Celia Lamkin, founder and global chairwoman of the National Youth Movement for the West Philippine Sea, also criticised the joint exploration deal for defying the tribunal ruling.

“It’s not only the Philippines that is being affected by what China is doing in the South China Sea,” said Lamkin, who funds the group to raise awareness about the territorial issue and provide help to fisherfolk. “We have to assert our sovereign rights in the West Philippine Sea. What is ours is ours.”

Analysts said other questions surround the agreement, including potential violations of the Philippine constitution for allowing joint development within the country’s exclusive economic zone, an area reaching 200 miles from the shoreline, as well as where other claimant nations such as Vietnam will be involved.

Kraft said joint development was an idea that had been raised for decades, but China’s growing power in the region and the arbitration decision has changed the context of those discussions.

“The Duterte administration is, of course, trying to push joint development – it’s part of the whole idea of fixing up ties with China,” Kraft said.

“The question that comes to mind is, why should we, from the Philippine standpoint, agree to joint development when it seems that joint development means both of us have claims, but what the arbitral decision shows is that China’s position as far as a claim to resources in the area is not as strong as it was before the arbitral decision came out. How do you accommodate that without seeming to keel over, or accept the way China frames the issue?”