Lutong Makaw

My father, the late Max Soliven once wrote about China. He said: The People’s Republic of China, once a pariah and “doomed” to failure in the world’s eyes after the June 1989 Tienanmen Square “massacre,” is now the Travel Destination of the Year. In ancient times, the saying went that “all roads lead to Rome.” Not anymore. Even Wal-Mart and Starbucks – and yes, Versace – are making a beeline for China. Now, China has become a world power. It is so strong that it could in fact widen its influence wherever they want and get what they want with such ease and candor.

My father first met Chairman Deng Xiaoping when he, as a member of the Philippines’ Foreign Policy Council accompanied the late Vice-President and Foreign Affairs Secretary Salvador Laurel to Beijing in 1988. It was at that session in the Fujian Room of the Great Hall of the People that Chairman Deng first announced that the Spratly’s “belonged” to China.

Chairman Deng called the Spratly’s by another name – Nansha Islands. He also made clear to the Philippine group that whatever name is given to the islands they still belong to China. For years now, China and the Philippines have contesting territorial claims in the South China Sea, an international waterway that Beijing claims as its own.

Remember how former President Benigno Aquino III launched a formal case against China over the matter in 2016 and the Hague tribunal ruled in favor of Manila, invalidating Beijing’s claims? Well, nothing happened because Chinese officials dismissed that ruling.

Then came Duterte. For some reason, he gave up on us and softened his approach to China. His stand is that China is so big and so strong she can wipe us out in a few seconds. Then, he made a dramatic turn around on our foreign policy when he declared a separation from the United States and chose to align with China. The president’s action of course angered many Filipinos.

Records show that in a span of 18 months, the government normalized its ties with China, thought of conducting a joint exploration in the disputed islands, re-enabled the Filipino fishermen to operate within the Scarborough Shoal and strengthened cooperation on tourism. A Six-Year Development Program was signed by the two countries to follow on the progress of their economic partnership in the areas of trade, investments, agriculture and fisheries, infrastructure, and tourism among others.

In October 2016 Duterte visited China. Chinese President Xi Jinping agreed to normalize diplomatic relations as well as resume bilateral dialogues on the issue of the West Philippine Sea dispute. This resulted in the signing of 13 cooperation agreements with the Chinese government and secured financial assistance and investment pledges worth USD24 billion, with business-to-business contracts amounting to USD 15 billion and official development assistance (ODA) comprising the remaining USD 9 billion.

With the closer ties between Manila and Beijing, 19 projects and programs worth a total of P731.7 billion are said to be rolled out during President Duterte’s term through loans and grants from China.

Two projects worth at least P500 million are the Department of Agriculture’s P500-million Philippine-Sino Center for Agricultural Technology-Technical Cooperation Program Phase 3, and the Seawater Desalination Complete Equipment Project in Dauis, Bohol will be financed by Chinese grants.

So far, the Duterte administration has signed two Chinese loan agreements, the P4.37 billion Chico River Pump Irrigation Project and the Kaliwa Dam worth P12.2 billion.

Projects that are still under negotiation for loans from China are the Department of Transportation’s P175.3-billion North-South Railway Project-South Line (Long Haul); and the Bases Conversion and Development Authority’s P57.2-billion Subic-Clark Railway Project; the P39.2-billion Ambal-Simuay River and Rio Grande de Mindanao River Flood Control Projects; P25.6-billion Davao City Expressway Project; P97.3-billion Panay-Guimaras-Negros Island Bridges; P56.6-billion Cebu-Bohol Link Bridge; P44.6-billion North Luzon Expressway East Project; P47.4-billion Dinagat (Leyte)-Surigao Link Bridge; P57.6-billion Luzon-Samar Link Bridge; P72.1-billion Bohol-Leyte Link Bridge; P14.4-billion Negros-Cebu Link Bridge, and P2.3-billion Camarines Sur Expressway Project.

The Camarines Sur provincial government’s P4.7-billion Pasacao-Balatan Tourism Coastal Development Program as well as the Department of the Interior and Local Government’s P20.3-billion Safe Philippines Project-Phase 1 are also seeking Chinese loan financing.

All these planned projects tapping China’s ODA sparked concerns on a “Chinese debt trap. How much price do we have to pay for the realization of the country’s “golden age of infrastructure”? It has been reported that among the loan contracts signed by the Philippines with other countries such as Korea and Japan, the deals with China had specific waivers on sovereign immunity and mentioned patrimonial assets. Socioeconomic Planning Secretary and NEDA chief Ernesto M. Pernia said that the Philippines was “more cautious” and “extra careful in having projects funded by China.

What about the dozens of Chinese citizens working on at least two construction projects under Duterte’s “Build, Build, Build” program and funded by Chinese grants? Foreign Minister Wang Yi said that Chinese investments in the country increased more than five-fold in the first six months of the year after a 67 percent expansion last year.

An exclusive report on “24 Oras” mentioned that project managers and many of the engineers and surveyors of the construction of the Binondo-Intramuros Bridge and the Estrella-Pantaleon Bridge are Chinese citizens. Based on DPWH data, there are 93 Filipinos and 55 Chinese nationals working on this project. These two projects cost P3.38 billion and P1.47 billion respectively and are funded by China through grants. By the way, the contractor is also Chinese.

The DPWH also said that it has urged China to abide by the Republic Act 6685 which requires private contractors to hire not less than 50 percent of unskilled laborers and 30 percent of skilled laborers from the residents of the area where the project is being undertaken.

Malacañang said that the Chinese workers are legally entering the country with permits. Those without proper documents shall face violations of immigration laws. Chinese Ambassador Zhao Jianhua told Presidential Spokesperson Salvador Panelo that, “If this government will just deport Chinese not in accordance with law, then we will also do the same.” That’s tit for tat.

The point is we are anxious about all these. The Spratly’s have clearly been taken over by China with the huge developments taking place over there. The Chinese financial assistance is enormous. Reports say that out of the 75 major projects the Duterte administration aims to complete on or before 2022, about one-fourth or 19 will be funded by China. The conditions and situation we are in with China is scary especially with the predicament we have with a country who we all know is positioning itself to be a global superpower. If these loans are not managed well, it can work to our disadvantage. Where do we go from here? Where will all these lead us to? Why is Duterte in a fix?