The Philippines received an $8.7-billion aid package at the end of Japanese Prime Minister Shinzo Abe’s two-day official visit. Now, that is indeed a huge sum for a new president who has been in office for only six months. The generous financial assistance, according to official statement, said the funds are loans and business investments from the Japanese private sector. It also includes several patrol boats to be used in the fight against pirates in Philippine seas.
Although it was left unsaid, there’s much more to Abe’s going-away gift in the first stop of his four-nation swing through the Philippines, Indonesia, Australia. and Vietnam. While we can assume that a strong bond of friendship developed between Abe and Duterte who visited Japan late last year, one can also read the reason behind the huge Japanese aid.
An ally of America which helped rebuild Japan’s economy from the ashes of war, Prime Minister Abe could be reminding Duterte the Philippines need not carry on a ménage a trois with military powers China and Russia. It is a reminder to Duterte that the Philippines has other friends in Asia and that it should not veer away from the United States.
Japan has a historical enmity with China, having occupied it during World War II. Japan also has a bitter territorial dispute with China involving the strategic Senkaku Island which the Chinese claim and call Diaoyu. Meanwhile, Russia and Japan are also locked in a 60-year territorial dispute over the Kuril Islands. Japan has seen how Russia annexed Abkhazia and South Ossetia in Georgia, and more recently, grabbed Crimea from Ukraine. Amid Japan’s and the region’s growing concern about China’s rising dominance in Asia, Abe’s assistance clearly can help prop up the Philippine economy and make it less susceptible to Chinese and Russian influence. The patrol boats surely were not meant just for use in the fight against pirates in the sea off Basilan, Sulu and Zamboanga. Surely, Japan intends for the Philippines to boost its maritime security against Chinese encroachment in the West Philippine Sea.
China in the last four years has taken aggressive moves in the South China Sea, reclaiming land and building artificial islands from the shoals, reefs and protruding rocks to build military installations for an airstrip and a naval station. This, despite The Hague international arbitration court ruling China’s nine-dash line claiming 90 percent of the South China Sea is illegal and without basis.
Why is China bent on staking its sweeping claim to nearly the entire South China Sea? Geopolitical observers attribute China’s aggressive move is to cushion itself from the impact of its possible collapse due to domestic problems including a restive Xinjian province and an economy that could face sanctions. While US President-elect Donald Trump has not announced any official policy on trade vis-à-vis China, the US could impose strict and heavy tariff on Chinese-made products. Manufactured Chinese export products comprised a huge percentage of China’s global revenues. Trump’s campaign theme to bring back home lost American jobs could add to China’s economic woes. He stopped the Indiana-based Carrier air condition firm from moving to Mexico by offering it tax breaks and other incentives.
Chinese products in the last three decades have flooded the US and European markets. While China has a population of 1.3-billion people, global market analysts doubt domestic consumers can prevent the economic bubble from bursting.
In the event of a showdown with the US, China could see its oil and energy supplies cut off if the strategic Strait of Hormuz is blocked by American warships. Iran might oppose such a move as it is a steady oil supplier of China. A blockade of the Hormuz is not going to have a big repercussion in the US which is self sufficient in oil from the Alaskan pipeline and under the ground in Oklahoma, Texas and the Gulf of Mexico.
An armed confrontation with the US could also have dire consequences for China. A preemptive strike on its lone aircraft carrier, the Lioning, could render the Chinese vulnerable in the South China Sea where US warships and war planes patrol the area.
While the US owes China some $1.3 trillion in debt, it seems more the lender’s problem than the borrower’s.
China’s answer to stem this possible grim scenario lies beneath the resource-rich South China Sea. Geologists believe the SCS seabed is a possible source of oil, gas and minerals which would solve China’s dependence on Middle East oil.