Oct 13, 2012

Philippines - China splits Philippine politics

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MANILA - Rising diplomatic tensions with China have sown divisions inside the Philippine ruling establishment, a widening and potentially destabilizing rift that has split President Benigno Aquino's administration.

While Aquino has publicly taken a hard line in response to Beijing's perceived provocations in the South China Sea, he has privately bid to use back diplomatic channels to maintain crucial bilateral trade and investment ties.

The domestic infighting comes in response to strained bilateral relations with China that some fear could break into open confrontation without a diplomatic course shift. That risk has risen in the context of America's "pivot" towards Asia and as Aquino makes strategic overtures towards the United States, including calls for more military assistance and the provision of spy planes to monitor China's naval activities in adjacent waters.

After Aquino issued a September 5 administrative order to officially rename the South China Sea the West Philippine Sea, a move that asserted Manila's sovereignty over contested maritime areas and potentially legally bound the US to defend those claims through a mutual defense treaty, Chinese President Hu Jintao refused to meet Aquino on the sidelines of last month's Asia-Pacific Economic Conference (APEC) summit in Russia.

Although the president legally has the final say over Philippine foreign policy, the Department of Foreign Affairs (DFA) is functionally the main institutional arbiter of external relations. Owing to the outsized significance of Sino-Filipino relations, DFA's control over China policy has been steadily undercut by competing interest groups, including highly influential business corporations with interests in China.

While Aquino has publicly condemned Chinese aggression, he apparently secretly sanctioned neophyte Senator Antonio Trillanes to pursue a parallel track of "back door" diplomacy with Beijing. The gambit was apparently initiated with little or no consultation with Foreign Secretary Albert Del Rosario - although other sources say that Del Rosario was in the cabinet meeting while Aquino was talking with Trillanes on the phone in the loudspeaker mode - and without the permission of Senate President Juan Ponce Enrile.

The gambit became public, with some commentators claiming the diplomatically inexperienced Trillanes fell unwittingly into a Chinese trap. The commentators claimed Beijing exploited the junior legislator's budding political ambitions by using him to divide the Philippine leadership, assert greater control over the contested Scarborough Shoal, and isolate the purportedly pro-US faction within the DFA.

Chinese officials apparently convinced Trillanes they were willing to withdraw their vessels from the disputed maritime territory around Scarborough Shoal in exchange for a reciprocal move by Manila. US senior envoy for East Asian and Pacific Affairs Kurt Campbell had earlier suggested to both the DFA and China to make a simultaneous withdrawal to de-escalate tensions and avoid militarization of the disputed area.

However, Trillanes boasted soon after in the local press about his role in "easing tensions" and "avoiding war", bringing the back channel talks into the public eye. Manila's withdrawal, however, was met by China removing only some of its naval ships. Beijing has since fortified its position around the shoal with a growing number of paramilitary and surveillance vessels.

In July, China consolidated its claim to the area by upgrading the administrative status of the nearby Sansha island, and demonstrated a willingness to defend the contested outpost through subsequent naval maneuvers in the vicinity. The Scarborough Shoal area has since for all practical purposes been off-limits to even Filipino fishermen and once-probing media.

Critics of the Trillanes-led deal claim as a result the Philippines has lost whatever measure of control it previously exercised over the shoal and its surrounding lagoon through its secretly negotiated withdrawal. They note that China has even refused to honor an earlier mutually agreed fishing ban to preserve the shoal area's fragile eco-system.

The fallout has reverberated through the Philippines' domestic politics, pitting China hawks versus China doves. For his part, Trillanes is said to have accused Del Rosario of "treason" for his dealings with the US and antagonism towards China, charges of treachery the foreign secretary has strongly refuted. As a veteran diplomat, including as former ambassador to the US, Del Rosario has driven a revitalization of Philippine-US strategic ties, including through several hat-in-hand trips to Washington.

In criticizing DFA policy, Trillanes has claimed that most Filipinos are uninterested in the Scarborough Shoal issue and would prefer instead to have cordial relations with China. According to an opinion poll conducted across 77 provinces by Laylo Research Strategies in August, 69% of Filipinos are concerned about preserving national sovereignty over the disputed shoal.

The Trillanes camp has also highlighted Del Rosario's former employment under Manny Pangilinan, chairman of Philex Petroleum and a potential key player in future exploitation of oil and gas in disputed South China Sea territories. They have publicly questioned Del Rosario's "impartiality" in dealing with China, insinuating a conflict of interest between his public and past private roles.

The war of words and Aquino's apparent secret diplomacy outside of DFA channels have reportedly prompted Del Rosario to consider resigning his post in protest. Trillanes has already called for Manuel Roxas, the newly appointed interior secretary, to replace Del Rosario should he step down.

Treason all around

On the other side of the political divide, Senate President Enrile has rushed to Del Rosario's defense. Enrile has accused Trillanes of not only bypassing normal parliamentary procedures in pursuit of the "back door" gambit (protocol required notification of the Senate president), but also of serving as a Chinese "fifth column".

Citing information provided by Philippine Ambassador to China Sonya Brady (who recently suffered a stroke and will soon be replaced), Enrile claimed that Trillanes held talks with top Chinese officials on at least 16 occasions. Enrile also insinuated Trillanes' "treason" allegations against Del Rosario, including accusations that the foreign secretary aimed to create a "war event" to justify boosting US military ties, were motivated by his Chinese contacts. Enrile himself has since been accused of treason for revealing confidential diplomatic notes in an open Senate session.

The antagonistic rhetoric and intra-government rifts has put Aquino in a tight political spot. In a bid to stem the political damage, Aquino has asked both Del Rosario and Trillanes to stop making public statements on the issue. "Senator Trillanes has the best interest of the country in mind ... I can categorically say the secretary of foreign affairs enjoys the trust and confidence of the President," presidential spokesman Edwin Lacierda said diplomatically in a recent news briefing.

Aquino has publicly denied Trillanes' claim that he was quietly appointed as a special envoy to China, saying instead he merely responded positively to Trillanes' suggestion to explore talks and ease tensions with China ahead of a trip he planned to make to China in May sponsored by Filipino-Chinese business executives. Philippine industrialists and businessmen have looked to Trillanes to smooth relations after Beijing imposed obstacles to bilateral trade and travel in the wake of the Scarborough Shoal stand-off.

In a press interview, Trillanes said he was approached by the Federation of Filipino Chinese Chambers of Commerce and Industry to play a mediating role. Lucio Tan, the Filipino-Chinese owner of Philippine Airlines with business interests in China, even sponsored his first-class trip to Beijing, Trillanes said in the interview.

The economic stakes of falling afoul China are huge. China, including Hong Kong, is the Philippines' largest export destination, accounting for 24% of total exports last year. Mainland China is the country's third-largest trade partner, with annual bilateral trade hovering around US$30 billion. Last year, the two countries agreed to expand their bilateral trade to $60 billion by 2016, which if achieved would transform mainland China alone into the Philippines' biggest export market.

Leading Filipino entrepreneurs with interests in China's booming real estate and retail sectors have banked heavily on their growing foreign investments there. Chinese visitors to the Philippines, meanwhile, were the fourth largest source of tourist revenues in 2011.

Beijing has also been a growing source of badly needed foreign direct investment, with China-financed projects across the Philippines now worth nearly $8 billion. Despite concerns about corruption and transparency, China is still considered a key source of concessional loans, primarily in the area of infrastructure development, a core component of Aquino's economic agenda.

In this light, Aquino's apparent approval of Trillanes' s back-channel diplomacy was an attempt to balance competing interests and appease Beijing while not backing away publicly from his tough rhetoric to defend the country's territorial integrity. In the wake of last month's APEC snub and the Del Rosario versus Trillanes fiasco, Aquino tasked interior secretary Roxas to meet on September 21 China's next leader, Xi Jingping, as a special envoy.

"I conveyed to vice president Xi [that] talk is better than no talk. So the fact that we are talking at the highest levels, the fact that messages are reliably conveyed, I think it's a good foundation," Roxas said in a news briefing after the meeting. "I think given the situation at least we are talking again with senior officials of the People's Republic of China, so that's a nice start," Aquino added.

The diplomatic niceties have helped to ease bilateral tensions while China's leadership transition unfolds, but the pitched struggle between competing factions with divergent views towards China inside Aquino's administration remains wholly unresolved. As Aquino attempts to strike a balance between national security concerns and economic imperatives, the risk of more infighting and policy incoherence is high.

Richard Javad Heydarian

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