Philippine-BRICS Strategic Studies report

November 6, 2017

 

 

 

In just a year since President Duterte’s handshake with President Xi Jinping in October 2016, PH-China trade and infrastructure project have not only taken off but is already soaring high.

 

 

Trade, Tourism and Investment.

 

Now the largest trading partners.

 

In 2017 China became the Philippines’ largest trading partner, largest import market and fourth largest export destination.

 

From China’s data, bilateral trade volume hit US$ 27.86 billion in the first seven months of 2017, with a 7.6% year-on-year increase.

 

Fruits exports rise 50% and growing.

 

Since October 2016, the Philippines’ fruits export to China registered a sharp increase of 50% and is bound to boom as the Filipino producers step up production to meet China’s orders in December 2016 for 100,000 tons more.

 

Tourism

 

The National Economic and Development Authority (NEDA) revealed on January 26, that the number of Chinese applying for a tourist visa to the Philippines has surged by 250% to 1,400 daily.

 

Following the lifting of Beijing’s travel restrictions In 2016, the Philippines recorded a 37.65-percent rise in Chinese arrivals to 675,663 from 454,962 in 2015.  As of the first half of 2017, Chinese tourist arrivals surged 33.44 percent with 454,962 visitors from 340,958 in the same period last year.

 

By October 2017 data already also shows that China has become the second most fruitful tourism market as China registered 90,763 arrivals, pushing down the US to third with registered 86,017 arrivals. China is set to fulfill its pledge of brining 1 million tourists to the Philippines.

 

Foreign Direct Investment.

 

China’s FDI to the Philippines reached US$ 35 million in 2016, a rise of 47% on a yearly basis, and in the first seven months of 2017 Chinese FDI already registered US$ 20 million with five months to go.

 

 

January 2017, Fast Track “Build, Build, Build”

 

In October 2016 multifaceted PH-China infrastructure projects were announced during the visit of President Rodrigo R. Duterte to Beijing to meet President Xi Jinping.

 

Three months later, in January 2017 the Philippine delegation led by Finance Secretary Carlos “Sonny” Dominguez and other cabinet members arrived in Beijing to present the list of projects to be funded by grants and loans by China.

 

The high level Philippine delegation submitted a total of 40 “large and small” infrastructure projects to China for possible loan financing and assistance in conducting feasibility studies during its Jan. 23-24 trip to Beijing.

 

 

The “Strides of March 2017”.

 

Two visits from higher and higher delegations from China to Manila marked what we call the “Strides of March” when the PH-China project took two giant steps forward.

 

In the first week of March Chinese commerce minister Zhong Shan arrived in Manila and met with cabinet officials led by Finance Sec. Carlos Dominguez and had a formal exchange of notes related to the financing and feasibility studies of various projects worth $ 3.5-B.

 

On March 15 Chinese Vice Premier Wang Yang arrived in Manila and visited President Rodrigo R. Duterte in Davao City. Subsequently, Vice Premier Wang Yang signed agreements for the import of agricultural products worth more than $ 1.5-B and formalize LOIs (Letter of Intent) for $ 10-B worth of investments to be registered with the BOI.

 

 

Bridging Trust.

 

Eager to build the trust of between the Philippines and China, China has donated and rushed two bridges worth $ 75-Million to be constructed across the Pasig River to help alleviate the traffic crisis in Metro-Manila.

 

These are the ones crossing from Estrella-Pantaleon bridge linking Makati to Mandaluyong over the Pasig, and the Binondo-Intramuros bridge. Ground breaking is expected to be graced by China’s Premier Li Keqiang during his visit in the next week during the Asean and East Asian summits in Manila.

 

 

Status of 3 PH-China Big Projects.

 

Despite LOIs and agreements signed and ready, approvals by the Philippine government is still required. Only in September 2017 did the NEDA approve the major infrastructure projects.

 

The largest of all the infrastructure projects is the $ 3.5-B ( P 175-B) 581-km. South Rail (Manila-Legaspi-Matnog to be funded by China was just been approved this September by NEDA.

 

The “New Centennial Water Source – Kaliwa Dam Project” worth Php 18.724-B from China, involving construction of Laiban and smaller Kaliwa dam, has been undergoing coordination between DPWH with the LGUs and concerned agencies.

 

The P2.69-b Chico River irrigation broke ground in August 2017 with Cagayan Gov. Manuel Mamba and NIA regional manager Antonio Lara. To be finished in three years, and as of September 2017 construction companies have been shortlisted.

 

 

Visayas-Mindanao Projects.

 

China is financing feasibility studies for the construction of Davao City expressway and Panay-Guimaras-Negros link bridge. Both sides identifying these second basket of infrastructure projects which can be implemented in the following years.

 

 

China’s helping hands.

 

 

China made A p 50-M cash donations along with hybrid rice seeds to the farmers which were heavily affected by typhoons “Karen” and “Lawin”, and also extended humanitarian aids and donated $ 1-M to the Surigao earthquake victims rehabilitation.

 

The Chinese Embassy donated 100 million pesos to the DSWD for its poverty relief and disaster response programs in the most poverty-stricken areas.      China donated P 65-M to families of AFP soldiers wounded in the Marawi anti-terrorists operations, and 47 sets of heavy equipment with a total value of P 150-M for the Marawi rehabilitation.

 

Since October 2016, the Chinese side has provided all in all more than 5.5 billion Pesos of grants and development assistance to the Philippines.

 

 

Anti-Illegal Drugs Assistance and Security.

 

China already provided the Philippines with two batches of equipment worth 436 million pesos, among which were drug detecting and testing equipment.

 

Two drug rehabilitation facilities in Mindanao are to be launched this November. Since 2016 more than 20 training programs for around 200 trainees from Philippine law enforcement agencies such as PNP, NBI and PDEA, similar programs have been conducted and will continue in the years to come.

 

China-Philippine cooperation interdicted in May a major shabu shipment on information from Chinese customs authoirties.

 

China has donated two batches of arms and ammunition critrical to improving the anti-terrorism campaign fo the government, first in June of 2017 the arrival of P 370-M worth of firearms and ammunition form China, and in October 3,000 rifles, 90 sniper rifles and 3 million rounds of ammunition.

 

 

The “desaparasido news”.

 

If there is “fake news” there’s also the “desaparasidos news” or the disappeared news –

 

There is no let-up in the efforts of some quarters identified with the old foreign policies contrary to the new Independent Foreign of the present Philippine government to kill the good news from the Philippine-China “entente” or friendly engagement.

 

Three mainstream media articles timed for the Asean and East Asian Summits in Manila this month of November highlight this continuing occurrence:

 

• Asia Times article “Is China Withholding Funds from Duterte?”, a deliberately “disappearing” the countless factual developments and positive statistics pointing to tremendous progress in the project between the Philippine and China;

 

It asks “… it remains unclear why Beijing has tarried in making actual outlays while other One Belt, One Road initiatives are steaming ahead in other Asian countries. Some analysts suggest Beijing may be withholding the funds until the bilateral relationship is more firmly consolidated, including in regard to unresolved territorial disputes in the South China Sea.”

 

We have provided the facts and statistics in this paper while at same time adding that “six years of the ‘lawfare’ Noynoy Aquino waged against China in the non-UN body that is called the PCA caused the major delays in constructive engagement with China while the rest of the Asean continued to complete their negotiation with China on railway and other economic projects that are in 2017 already underway”.

 

• Philippine Daily Inquirer editorial of November 4, 2017 “Promises, promises” asking in its first paragraph “Can China’s word be trusted—specifically its much-ballyhooed promise of billions of dollars of aid to and investment in the Philippines?”

 

This technique of hiring a non-entity to write a piece in any international magazine for a local mainstream media to pick and spread is old hat, but the Philippine Daily Inquirer is clearly in cahoots with the “disappeared news” the Asia Times and its correspondent from an little southern Philippines newspaper.

 

• BusinessWorld article of November 2, 2017 – “Has our One China policy worked to our benefit?” with grossly misleading statements like “Data from the BSP shows that … China invested an anemic $3.34 million in the Philippines … , China purchased a mere $3.296 billion worth of goods from the Philippines … China’s relatively inexperienced construction firms,… Taiwan, being the more affluent nation, has been a generous neighbor to the Philippines ….”, and “… Contrary to what many believe, the funds made available to us is not a grant — they are loans that must be repaid at interest rates substantially higher… “

 

Aside from all the factual data already provided in this article, the BusinessWorld piece “disappears” the P 1.25-B two Pasig river bridge grants and the less than 2% interest on Chinese loans announced by Secretary Carlos Dominguez that debunks all the black prop started by Forbes magazine (May, 2017) from Booz-Allen (CIA) analyst Anders Corr’s claim of 10% interest on the loans,

 

 

PH-China on course to “The Community of Shared Golden Destiny”

 

 

The Philippines and China have re-established a thousand years of economic and people-to-people relations little paralleled in amongst the community of nations today. The relations 60-years ago highlighted by the symbolic expedition this week of the three Balangay boats retracing the journey of the Sultan of Sulo Paduka Batara in 1417 made the Philippine islands then “the emporium of Asia” is now once more a reality.

 

By PPP (power purchase parity) China is now the largest economy in the World and its 1.4-Billion consumers the major market of the planet, and engineering expertise from 125,000 km. of railways and 330 dams hydroelectric dams, most successful telecoms, ad nausea.

 

Its a New Era of a Community of Shared Destiny providing the vision of Peace and Prosperity for the 21^st Century under the new model of international relations based on “Win-Win” through the Belt and Road Initiative and multi-Polar World of the BRICS (Brazil-Russia-India-China-South Africa) multi-continental partnership.

 

It is in this setting that the PH-China era of cooperation and engagement that the Philippines launches its golden era of infrastructure and economic development – and soars high. ###