Philippines’ South China Sea deal with Beijing hits another snag over profits

Discussions did not reach ‘working-level talks’ as Beijing wanted 50-50 per cent revenue-sharing instead of 60-40 per cent deal in favour of Manila

Negotiations stalled after Beijing pushed for conditions that were unacceptable to the Philippine government, foreign affairs secretary says

2-MIN READ2-MIN

An offshore oil platform in the northern waters of the South China Sea. Photo: Xinhua

Published: 3:46pm, 6 Sep 2022Updated: 4:01pm, 6 Sep 2022

The Philippines has said initial talks with Beijing on oil and gas exploration in the South China Sea have failed to progress, as the issue of profit-sharing remains a major sticking point for both sides.

The Department of Foreign Affairs on Monday said the deals should adhere to the country’s constitution and international law, adding Manila wished to “build on the gains that have been reached in principle by our predecessors” under a new and mutually agreeable framework.

The ministry also said the discussions that took place during the visits of Chinese Foreign Minister Wang Yi and the International Liaison Department chief Liu Jianchao in July and August had not advanced to “working-level talks”.

Foreign Affairs Secretary Enrique Manalo told a House of Representatives hearing last week that China had sought a 50-50 per cent revenue-sharing deal on the joint project rather than a 60-40 per cent arrangement in favour of the Philippines.

Manalo said the negotiations came to a standstill after Beijing pushed for applying conditions in line with its domestic laws that were unacceptable to the government.

In June, President Ferdinand Marcos Jnr’s predecessor, Rodrigo Duterte, terminated talks over joint energy exploration between Manila and Beijing in the South China Sea, citing constitutional constraints.

As the diplomatic stalemate continues, former foreign affairs secretary Albert del Rosario called on the Marcos administration to go ahead and develop the oil and gas fields that are part of the country’s exclusive economic zone (EEZ) in the disputed waterway.