Vital visit

China’s growing importance to the Philippine economy is beyond dispute.

Latest trade statistics show that the top import and export partner of the Philippines is China. Data released by the Philippine Statistics Authority (PSA) earlier this month show that China’s imports from the Philippines hit $939.98 million or 34.4 percent higher than that from the same period last year of $699.48. 

The figure above excludes those from Hongkong, which is a special administrative region of China. Hongkong came in third, importing $851.94 million or a 5.2 percent from the $810.17 million recorded in August 2017. If the two were reported as one, the total would be $ 1,791.92 million, leading by a mile the second top Philippine export market which is the United States which recorded $934.04 million.

In 2017, Philippine exports to China grew 8.4 percent, with top exports or about half to China mostly being electronic products, according to Socioeconomic Planning Secretary Ernesto Pernia.

Pernia has said that the Philippines’ total merchandise trade with China continues to rise and China has become the country’s top bilateral trading partner, surpassing Japan in 2016. This was brought about by imports growth averaging 20.7 percent from 2010 to 2017, he said.

Export commodities showing promising growth were coconut oil, communication radar equipment, abaca fibers, copra meal or cake, and mangoes.

In 2017, imports from China increased 8.1 percent comprised mostly of capital goods and raw materials and intermediate goods.

The Philippines’ balance of trade with China is severely lopsided in favor of the latter, a situation which China recognizes and wishes to correct by ramping up its imports from the Philippines.

China’s ambassador to the Philippine Zhao Jianhua has expressed his country’s desire to import $9 billion more from the Philippines by the end of President Duterte’s term in 2022.

We should then be prepared as a nation to deliver the additional $9 billion worth of goods, while our government should make sure that the commensurate profits from these exports benefit majority of Filipinos.

Proof of the improving relations between the two countries was the recent visit of Chinese State Councilor and Foreign Minister Wang Yi, who inaugurated the Consulate General of The People’s Republic of China in Davao City over the weekend. He was also scheduled to sign bilateral documents with newly installed Foreign Affairs Secretary Teodoro Locsin Jr.

Meanwhile, preparations are underway for the visit of Chinese President Xi Jinping in November, with at least 10 loan agreements expected to be signed.

Among the agreements scheduled to be signed are the P12.2 billion-New Centennial Water Source-Kaliwa Dam Project; P175.3-billion PNR South Long Haul Project; P20.3-billion Safe Philippines Project Phase I; and the P57.1-billion Subic-Clark Railway Project.

For June 2019, those that will be signed include the construction of five bridges across the Pasig-Marikina River, Manggahan Floodway (P13.6 billion), and the Ambal-Simuay River and Rio Grande de Mindanao River Flood Control Projects (P39.1 billion).

Other projects included in the first basket of projects to be financed by the Chinese government are the Chico River Pump Irrigation Project, and the Binondo-Intramuros and Estrella-Pantaleon Bridges Construction Projects.

Budget Secretary Ben Diokno earlier said that the Chinese government is one of the country’s development partners to ensure the success of the Build Build Build infrastructure program.

Diokno has also said that China is interested in financing a park in Clark Freeport and in co-financing with the World Bank the rehabilitation of a power plant in Mindanao.

It is also expected that crucial joint oil and gas exploration and exploitation projects with China will be unveiled.

Malacañang has revealed that in order to minimize the country’s dependence on imported oil, the government is working double time so it could sign a joint oil exploration deal with China in November.

Our government is hoping that a joint agreement would help pave the way for commercial oil production by 2027. The Malampaya natural gas field in Palawan has a contract until 2022, but the field could still supply gas until 2032.

Just last week, Japanese Prime Minister Shinzo Abe went to China and signed 10 agreements, including a currency swap deal.

China is the present and the future of the world, America is in the past, and it is good that President Duterte has recognized this shift early in the game.

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