South China Sea: New Philippine leader must honour joint exploration agreement with Beijing or face conflict, says Duterte
- Manila and Beijing agreed in 2018 to work out joint oil and gas exploration in contested waters without addressing the issue of sovereignty
- Duterte, who leaves his post on June 30, said ‘someone’ in China reminded him of the Memorandum of Understanding. ‘If that is changed, it’s going to be risky’.
Philippine President Rodrigo Duterte has told his successor that Manila must honour an agreement his administration made with China to jointly explore an area in the disputed South China Sea for oil and gas deposits – or face possible conflict.
He said that in light of the presidential election taking place in May, someone “reminded me – I won’t say who from China” that both sides already had an agreement on joint development of Reed Bank, also known as Recto Bank, which falls in a contested area of the South China Sea.
An international tribunal ruling on Manila’s unilateral challenge to Beijing’s claims in 2016 said Reed Bank was considered part of the Philippines’ exclusive economic zone (EEZ) and continental shelf, where Manila has exclusive sovereign rights.
It is an undersea feature that is 85 nautical miles from Philippines’ Palawan island but 595 nautical miles from China’s nearest land mass, Hainan, according to retired Supreme Court justice Antonio Carpio. China has rejected the tribunal ruling.
But in November 2018, during Chinese President Xi Jinping’s state visit to Manila, both sides signed a “Memorandum of Understanding (MOU) on Cooperation on Oil and Gas Development between the Philippines and China”.
They agreed to set up committees to work out how they could conduct joint oil and gas exploration without having to address the issue of sovereignty. Both sides committed to a deadline of signing a cooperation agreement by November 2019, but this has not taken place.
The MOU itself has never been officially released to the public but a leaked draft stated the involvement of the state-owned China National Offshore Oil Corporation.
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But the person from China “whispered to me ‘Don’t be that way, we should follow our original contracts’,” Duterte added.
In the broadcast that aired on national television on Monday, Duterte, who can only serve a single six-year term under the constitution, said he was told by the person in China that “just in case you send soldiers, we will also send soldiers”.
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This, he said, was a situation he had been trying to avoid as “then we will have a war here, there’s war in Ukraine, then there’s Taiwan that China wants to grab back, then here … so many flash points, so many areas which can blow up. We do not need it. We don’t need to fight over this.”
The next administration, Duterte said, “should just follow what we have talked about”. After all, he added, both sides had held talks and had a written agreement. “If that is changed, it’s going to be risky,” he concluded.
Duterte’s comments come as campaigning for the presidential contest heats up, with former senator Ferdinand “Bongbong” Marcos Jnr seen as the front runner, buoyed by his partnership with Duterte’s daughter Sara Duterte-Carpio.
Marcos, whose dictator father Ferdinand Snr established relations with China, is expected to continue Duterte’s policy of setting aside the tribunal ruling in favour of close economic ties with Beijing.
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Beijing claims almost the entire South China Sea, and this is countered by the Philippines, Malaysia, Brunei, Vietnam and Taiwan.
Jaime FlorCruz, currently a visiting professor at Peking University and a retired journalist based in China, told Filipino educators during a webinar held by the Manila-based Asian Institute of Management earlier this month that the Chinese sense of nationalism was shaping their claim in the South China Sea.
But while Filipinos should be aware that the Chinese were as patriotic as them, the Philippines should “just as much defend our territorial and sovereign rights and claims”.
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“And that’s what makes this a very complex issue,” he said, adding that oil and gas exploration in the South China Sea was also an economic issue as China needed energy resources for economic growth.
“My hope and my wish is that we will protect our own national interest and that we will strike a deal ... that is mutually beneficial and that is fair to both sides. It’s an economic or commercial decision but it should not be at the expense of our national patrimony and our national sovereignty,” FlorCruz said.
Philippine Ambassador to China, Chito Sta Romana, aired the same sentiment in a forum several days later by the Manila-based Philippine Association for Chinese Studies.
He recommended that the next president “take advantage of the momentum of the growth of our various areas of cooperation, particularly in trade and investment, tourism, cultural, educational and other people-to-people exchanges”.
He said “it is not advisable for us to stop engaging with China” and one way to “manage the tensions arising from maritime issues” is through the Bilateral Consultation Mechanism on the South China Sea (BCM) which met for the first time in 2017 and for the last time on May 21 last year via video conference.
Through the BCM, discussions had been frank, candid, in-depth and friendly, he said, adding that both countries should find common ground.
Manila, he said, would need to craft “a long-term strategic view of our relations with China” that goes beyond the six years of the term of a sitting president, using national interest as “our compass as embodied in the Philippine Constitution and international law”.
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Based on precedent, it is unclear how binding the Reed Bank MOU is for the next administration. Philippine presidents have rescinded even signed and ongoing contracts entered into by their predecessors.
For example, in 2002 President Gloria Macapagal-Arroyo scrapped a multibillion pesos deal to construct the Ninoy Aquino International Airport Terminal 3 by the Philippine International Air Terminals Co.
In 2012 President Benigno Aquino III did away with another multibillion pesos deal over the construction of Northrail by the China National Machinery Industry Corporation (Sinomach), while Duterte scrapped the contracts of Metro Manila’s water service firms, Manila Water Company and Maynilad Water Services, after coming to office in 2016.
All three presidents used the same argument that the contracts had terms onerous to the current government.
