Diplomatic Pouch / April 3, 2015
By Larry Luxner
China’s aggressive actions in the South China Sea threaten the security of the entire Asia-Pacific region, Philippine Ambassador José L. Cuisia Jr. said recently.
The diplomat’s warning came during a wide-ranging speech on Philippine-American ties that touched on everything from maritime border disputes to the bilateral Enhanced Defense Cooperation Agreement (EDCA) and the Partnership for Growth.
“Security continues to be a major issue in Southeast Asia, and the Philippines remains very concerned over the exacerbating tensions in our region,” he said. “China is still undertaking dangerous, reckless and forceful activities in an attempt to impose unilateral change in the maritime status quo.”
The ambassador spoke at a March 27 event co-sponsored by the US-Philippines Society and Johns Hopkins University’s School for Advanced International Studies (SAIS), located right across Massachusetts Avenue from the Philippine Embassy.
Cuisia said Bejing’s actions in advancing its so-called “nine-dash line” over nearly the entire South China Sea is in contravention of the 2002 declaration by the Association of South East Asian Nations (ASEAN) as well as the United Nations Convention on the Law of the Sea (UNCOLS).
“China is currently undertaking a series of massive reclamation projects, all of which look to be near completion,” Cuisia said, pointing to before-and-after slides of photographs showing reefs in the nearly uninhabited Spratly Islands, which are claimed by five nations besides China: Taiwan, Malaysia, Brunei, Vietnam and the Philippines.
“The reclamation, combined with other actions such as setting up onshore and offshore observation networks, and a future air defense identification zone, pose a threat to freedom of navigation and impede lawful commerce,” he said.
Cuisia urged for “the rule of law to prevail in settling this dispute for the sake of peace, security and stability” in the region. He said that ASEAN would intensify efforts to conclude a multilateral code of conduct while Malaysia occupies the 10-member bloc’s rotating presidency this year.
“ASEAN has been working with China for quite some time now. The pace of negotiations can only go as fast as the parties want it to proceed,” he said. “We hope to increase the frequency of meetings so that the issue can be resolved as soon as possible.”
Among the 50 or so people listening to Cuisia’s speech were Ambassador John F. Maisto, president of the US-Philippines Society, and national security expert William Wise, associate director of Southeast Asia Studies Program at SAIS.
“The Philippines has strongly urged China to desist from its reclamation activities that are intended to alter the status quo,” said the ambassador, noting that on March 20, the Senate Committee on Armed Services sent the State Department a letter regarding China’s reclamation projects in the South China Sea.
“The letter says the Obama administration needs to do more on the reclamation issue,” he said. “We’re pleased that the legislative branch has spoken prominently on this issue, and we hope the Chinese get the message.”
In mid-November, Manila will host the 2015 Asia-Pacific Economic Cooperation summit — an opportunity Cuisia says offers the Philippines a chance to showcase what it has accomplished under the leadership of President Benigno S. Aquino III.
Last year, the Philippines reported GDP growth of 6.1 percent — one of Asia’s highest — down from 7.2 percent in 2013. This year, the country could see growth of 6.9 percent. And by 2016, the Philippines will outperform China, with GDP growth of 7.3 percent (versus 6.7 percent for China), according to Citibank’s 2015 annual outlook.
The APEC summit is an annual gathering of 21 Pacific Rim member countries. The first meeting was held in Canberra, Australia, in 1989; the only other time the Philippines hosted an APEC summit was in 1996, when Fidel Ramos was president.
In recent years, said Cuisia, his country has made “tremendous strides.”
For example, the business process outsourcing (call center) sector has grown by more than 20 percent in the last six years. Overseas remittances are also up, with Philippines working abroad now sending back an average $25 billion a year.
Meanwhile, in 2014, foreign direct investment (FDI) reached $6.2 billion, a 66 percent jump from the $3.7 billion in FDI recorded in 2013 — with investments coming mainly from the United States, Hong Kong, Singapore, Japan and the United Kingdom.
The Philippines now ranks 76th place in the Heritage Foundation’s 2015 Index of Economic Freedom, up from 115th in 2011. That makes it the most improved ASEAN country in the ranking. It also jumped 33 notches, from 85th place in 2010 to 52nd last year, in the World Competitiveness Index, while Transparency International’s latest Corruptions Perceptions Index ranks the nation at 85th worldwide, up from 134th in 2010.
Cuisia added that 2014 was a good year for Philippine tourism, with five million visitors generating $4.8 billion in revenues. The United States now comprises 15 percent of all arrivals — a number expected to grow with the mid-March resumption of direct service between New York JFK and Manila on Philippine Airlines.
Filipino-Americans have eagerly awaited the new 16-hour flights, which operate four times a week, ever since the country’s national flag carrier stopped serving the region in 1997. About half a million ethnic Filipinos live on the East Coast, including 90,000 in Virginia and 75,000 in Washington, D.C.
Separately, the Feb. 25 signing of a memorandum of cooperation between Washington and Manila could dramatically boost U.S. investment in the construction of highways, gas pipelines, mass transit systems, bridges and other public works.
“The idea is to get more U.S. firms involved in infrastructure projects, which will reach 5 percent of GDP by 2016, up from 1 percent when President Aquino took over in 2010,” he said. “So there will be tremendous opportunities for U.S. firms to participate.”
EDCA’s future is less clear. Signed during President Obama’s April 2014 visit to the Philippines, the 10-year accord is the first substantial bilateral military agreement since U.S. troops were kicked out of Subic Bay Naval Base in 1992. It allows the Pentagon to station troops and operations on Philippine soil but prohibits the establishment of a permanent base or the storage of nuclear weapons.
However, EDCA now appears to be bogged down in a major legal dispute.
“A month after signing the agreement, a suit was filed by groups who either believe the agreement is not constitutional or they’re not convinced of its merits. This is inevitable in a democracy,” Cuisia said. “I’m hopeful that as the Supreme Court deliberates this case, its merits will be brought to the fore and that the court will rule in favor of the agreement.”