Hosting Philippine President Ferdinand Marcos Jr. was the opening act for China’s diplomatic efforts this 2023. As the Lunar New Year dawns, it is worth reflecting on what the visit meant for both countries.
Rise of neighborhood diplomacy
For China, the visit portends greater importance attached to neighborhood diplomacy. Despite signaling its intent to improve ties with the United States, as demonstrated in the appointment of its former ambassador to Washington, Qin Gang, as its new Foreign Minister, Beijing expects competition will continue to dominate great power relations, that decoupling will carry on, and that regional flashpoints may become potential tinderboxes for U.S.-China confrontation. As the U.S. and other major powers diminish reliance on the Chinese market, so too does China on Western capital and technologies.
The turn to its immediate neighbors, especially in Southeast Asia, has a strong economic and security impetus. Since 2020, the second year of the U.S.-China trade war, ASEAN members have emerged as China’s largest trade partners. Meanwhile, hotspots that pit China with its ASEAN coastal neighbors, notably the South China Sea, have the prospect of inviting rival powers. Hence, it is in Beijing’s interest to keep sound relations with its neighbors. Such desire is reflected in the timing of the hosting of regional leaders. For instance, in July of last year, Indonesian President Joko Widodo became the first head of state hosted by China since the Beijing Winter Olympics. Last November, Communist Party of Vietnam Secretary General Nguyen Phu Trong was the first foreign leader to visit Beijing after the 20th Communist Party of China Congress. Seen from this vantage point, Marcos’ visit to start the year was not an outlier. Rather, it is a trend that is likely to gather pace as China leverages proximity and economic heft to win countries in its critical periphery.
China understands that the Philippines-U.S. alliance runs deep. With the departure of China-friendly former president Rodrigo Duterte, Washington is doubling down in entreating Manila back to its fold. Beijing does not expect to flip Manila to its side,but it does wish to convey its security concerns. Through inducements and disincentives, it aims to dissuade its neighbors from closing ranks with rivals.
Gearing to gain from China’s reopening
For the Philippines, the state visit is in line with its independent foreign policy strategy of being “a friend to all and an enemy to none.” It also underpins Manila’s conviction that the maritime row does not represent the sum total of its relations with its big neighbor. China is the country’s largest trade partner, major investor, rising infrastructure builder, and fastest-growing tourist market. Coming amid a surge in Covid-19 cases, Marcos’ visit was much a show of solidarity as it is about positioning the Philippines as China reopens to the world.
Compared to its mainland ASEAN neighbors like Vietnam and Thailand, Manila’s insularity, high utility, and production costs, lack of coherent long-term economic planning, and traditional Western orientation long disadvantaged it in attracting more Chinese trade and investment. Like his predecessor, Marcos wanted to arrest this. He wants to offset some of his country’s geographic and infrastructure handicaps by fostering robust political and diplomatic ties with Beijing. Economics is a key piece behind his aspiration to shift relations to a higher gear.
Of the fourteen bilateral deals signed during the visit, eleven pertain to agriculture, fisheries, infrastructure, tourism, e-commerce, and development cooperation. Marcos sees a synergy between his “Build Better More” and China’s nine-year-old Belt and Road Initiative with both sides renewing partnerships for infrastructure development. He obtained funding for three priority bridges in Metro Manila as China commenced work on the Davao-Samal Island bridge in Mindanao. Eager to bolster his country’s e-connectivity, he bagged a deal to promote cooperation on digital and emerging technologies.
Marcos added durian to a growing list of lucrative tropical fruit exports to China that already includes bananas, pineapples, green coconuts, and avocados. More than sourcing fertilizers and farm produce from China to address poor domestic production and rising costs in the short run, he hopes to attract Chinese investment to modernize Philippine agriculture. Raring to get more Chinese travelers as the world’s largest tourist market returns, he obtained an agreement to boost tourism. Hence, pragmatism - not geopolitics - was the driver behind his visit.
Downplaying disputes to expand economic ties
Keen to insulate broader relations from a long-running multiparty maritime spat, both sides restored high-level dialogue on the South China Sea. A communication mechanism between their foreign ministries was established. Both sides are poised to resume a bilateral consultative channel setup in 2016, as well as practical cooperation between their coast guards and annual security talks. While such dialogue and confidence-building measures remain stopgap measures, their role in managing sea incidents cannot be understated. Such venues can also complement efforts by ASEAN members and China to step up negotiations for a Code of Conduct and explore other options in handling the persistent row.
No claimant is expected to diminish their position in the flashpoint. Duterte, despite fostering cozy ties with Beijing, has upgraded Philippine facilities in the Spratlys and embarked on military and coast guard modernization. The country became the first foreign buyer of India’s BrahMos cruise missiles co-developed with Russia and Turkey’s T-129 ATAK helicopters. Manila also became the first market of Japan’s overseas defense export - four radar systems - with Tokyo also supplying the Philippine Coast Guard with a big brand new multirole response vessels. Under Duterte, the country also acquired Brazilian Super Tucano light attack aircraft, and Black Hawk helicopters, and ordered Korean corvettes and offshore patrol vessels, not to mention Russian heavy-lift choppers. Before the pandemic hit, Manila was close to signing a contract for submarines. Hence, diplomacy did not crowd out defense buildup. What Marcos’ predecessor did was to prevent the disputes from defining relations with Beijing and for good reason.
While protesting and responding to China’s actions in the Philippines’ exclusive economic zone is imperative, making the maritime tiff front and center of ties is counterproductive. As the late Philippine Ambassador to China Jose Santiago Sta Romana stressed, the contentious part of the relations should be compartmentalized so that other aspects can flourish. Disputes aside, no littoral state in the contested sea has reduced trade with and investment from China. Quite the contrary, all of them expanded their business with Beijing. Vietnam, China’s arch-foe in the South China Sea, is its largest trade partner in ASEAN and sixth largest overall trade partner. Malaysia and Indonesia are also among China’s largest global trading partners. These neighbors continue to shore up their maritime capacity and reinforce their presence in the flashpoint, all the while maintaining dialogue and downplaying the disputes. Such a lesson is worth pondering for Manila.
Marcos’ visit to China signals the growing importance of neighborhood diplomacy in China’s foreign relations hierarchy. For the Philippines, it conveys a desire to ride on its big neighbor’s rebound and to keep disputes from impairing overall relations.
