Philippines prefers China loans over US 'strategic confusion' in South China Sea

Filipino soldiers on Thitu island in the disputed South China Sea on April 21, 2017. PHOTO: REUTERS

MANILA (BLOOMBERG) - The US is projecting "strategic confusion" in the South China Sea, the Philippines' top diplomat said, prompting the South-east Asian nation to deepen its ties with China.

President Rodrigo Duterte prefers China's offer of loans and investments in the absence of a clearer stance from the US in the disputed sea amid growing rivalry between the two nations, Philippine Foreign Affairs Secretary Teodoro Locsin said.

"China's offer of a strategic partnership is a bit more attractive than the current offer of the US of strategic confusion," Mr Locsin said in an interview on May 16 in his Manila office.

Mr Locsin recalled how former president Barack Obama, in his visit to Manila in 2014, didn't give a clear assurance that the US would defend the Philippines against China in case of a conflict in the South China Sea.

Since then, President Donald Trump's administration has been at pains to stress "we have your back".

Still, the Philippines continues to be a US military ally and will come to its side if conflict erupts, Mr Locsin said, adding he wants to retain an almost seven-decade-old defence treaty with the US.

"It has always been clear, that in a war, we are allies of the United States. There's no question about that."

Tensions have flared between the US and China in the resource-rich South China Sea amid an ongoing trade war.

The US sent two warships near disputed islands earlier this month - a move that drew opposition from China.

Mr Locsin pushed for boosting the Philippines' defence capabilities and more patrols by claimants in the disputed waters.

"If there's an incident that happens in any of those features, it won't be one nation's word against another. You'll have witnesses all around. That's what I'm looking forward to; when we saturate our oceans with our coastal presence."


Mr Duterte plans to further boost ties with China in the remaining three years of his term, Mr Locsin said, adding that Manila's renewed friendship with Beijing had resulted in infrastructure funding, trade deals and investments.

Yet talks on a joint resource exploration in the South China Sea have dragged even as Mr Duterte pivoted his foreign policy to China when he took office in 2016.

Commercial talks on the joint exploration pact signed by Mr Duterte and Chinese President Xi Jinping in November could begin later this year, Mr Locsin said.

China has also stepped up efforts over the past decade to block other nations from extracting energy resources in the South China Sea.

A 2016 ruling by an international arbitration panel in the Hague rebuffed Chinese claims over parts of the sea - but failed to halt its activities in areas also claimed by the Philippines, Vietnam, Brunei, Malaysia and Taiwan.

"Our defence treaty with the US does not preclude increasing or deepening economic relations with China. In that regard, we're very far behind in the region. We're not the biggest or most-linked with their economy," Mr Locsin said.

Still, the Philippines will not yield its South China Sea claims in exchange for improved economic ties, the foreign secretary said.

He added his department will file more diplomatic protests against China over the continued presence of its ships near a Philippine-occupied island in the disputed sea.

"When it comes to our policy with China, it can be summed up in one sentence: surrender is never an option," he said.

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