Over the last four years, the Philippines has proven to be the U.S.’s most cooperative partner in Asia, embodied by famously warm relations between Presidents Donald Trump and Rodrigo Duterte. The Philippines’ close proximity to China and it’s disputed waters makes it an important military ally to the U.S, and with a new President stepping into the White House, Biden and Duterte will have to establish a new diplomatic relationship between the two countries.

Duterte’s decision to cut ties with the US exposes the Philippines to many geopolitical threats and represents a strategic victory for Beijing in the region.

On Feb. 12, the government of the Philippines issued a notice to the United States embassy to terminate the Visiting Forces Agreement, or VFA. Under the agreeme

Philippine president Rodrigo Duterte has sent mixed signals about how he will pursue his country’s South China Sea arbitration award against China in 2016, and his recent rhetoric promising to take a tougher stance on China may not come to fruition.

While unable to alter Duterte’s diplomatic strategy towards China, the influential and largely autonomous Philippine defense establishment is conducting a parallel China policy of its own. The result is a dualistic foreign policy, combining both engagement and deterrence.

Recent US Navy drills in the South China Sea invited old friends like Japan and the Philippines, but also new partners like India. An expanded US military presence in these disputed waters is part of America’s “Indo-Pacific Strategy” to block Chinese military expansion — and perhaps to apply pressure during ongoing trade talks.

Despite Duterte’s fiery anti-US rhetoric, the Philippines and the US retain their strong military alliance. Similarly, on China-Philippines relations, Manila’s bark is worse than its bite — alongside South China Sea disagreements, the two sides have rapidly expanding economic ties. A bilateral (not trilateral) approach, with respect for each side’s red lines, is the key to avoiding escalation and deepening cooperation.

Continued friction may define US-China relations in the coming years. As such, balancing ties between the two major powers will constitute the greatest foreign policy test for successive Philippine administrations.

With big-power competition intensifying in the South China Sea region, the Philippines could be dragged into conflict. Reviewing the terms of the US-Philippine Mutual Defense Treaty can only provide minimal security for the entangled Philippines nation.

The Philippines has announced that it will review the 1951 US-Philippine Mutual Defense Treaty, raising questions about the future of the Philippines’s relations with the U.S. and China. The review, however, also provides a unique opportunity for the two allies to upgrade their partnership.