OPINION: Banana Diplomacy: Duterte’s Bet on China

Richard Heydarian

Posted at Oct 17 2016 02:55 AM

China, a major market, has relaxed restrictions on imports of Philippine-made bananas. Prior to the imposition of sanctions in 2012, shortly after the Scarborough Shoal crisis, China represented a $60 million customer for our banana exporters. 

This will go a long way in helping Filipino fruit exporters and could very well be the beginning of expanded export opportunities for Filipino businessmen, many of whom will accompany President Duterte during his upcoming visit to China. 

The bilateral investments picture, which has been undermined by territorial tensions in recent years, is also looking more promising. By some accounts, the Philippines invests more in China than the other way around. And the Philippines is the only country in the region that doesn’t count China as its top trading partner. 

As a leading global supplier of public infrastructure, including in the United Kingdom’s nuclear sector, China could soon be involved in big-ticket projects in the Philippines, including a prospective "bullet train" between Subic in Zambales and Clark in Pampanga. A trans-regional railway, connecting Mindanao internally and with the rest of the country, could also be in the cards. 

Interestingly, the entry of China into the Philippine infrastructure picture has encouraged Japan, South Korea and other major players to up the ante. So we may expect more competitive bidding among major infrastructure suppliers. 

In a nutshell, these are encouraging developments -- and should be welcomed accordingly. Improving relations with China is also a good reminder that when it comes to foreign relations, Duterte’s first 100 days haven’t been a straightforward ‘diplomatic disaster’ as some critics put it.  

In the next few months, however, the Duterte administration should engage in a systematic effort to ensure we maintain robust relations with our traditional partners and protect our territorial integrity just as we normalize and improve ties with China. This is ultimately what foreign policy balancing is all about.

Shaking Things Up 

Without a question, as far as the Philippines’ relations with the Western world are concerned, the past few months have been, to put it mildly, a wild ride. There is no denying that. No less than senior advisers such as former President Fidel V. Ramos have begun to speak out on the issue. 

Incensed with Western criticism of his signature policy, namely ongoing ‘shock and awe’ campaign against drugs, President Rodrigo Duterte has not shunned profanity and braggadocio in his retaliatory statements. 

For the president, the West is violating the Philippines’ sovereignty and his electoral mandate. For the West, Duterte is violating basic rules of diplomacy and undermining mutual trust and confidence. When it comes to relations with fellow Asian countries, however, things are looking nowhere as worrying. 

If anything, relations with Japan, Asia’s most developed nation, look robust, while much of the Association of Southeast Asian (ASEAN) nations has welcomed his pragmatism in regional maritime disputes. 

Although, it must be said, based on my exchanges with policy-makers across East Asia, even our closest neighbors have been astounded by Duterte’s off-the-cuff-remarks and invective-laced rhetoric. 

In pursuit of a more independent foreign policy, Duterte has sought to diversify Philippine foreign relations by reaching out to Eastern powers such as China and Russia. This way, the president hopes to expand the Philippines’ room for maneuver and avoid excessive dependence on any specific external power. 

The Balancing Imperative

Unquestionably, China is an economic powerhouse. It is, by some measure, the world’s biggest economy, trading nation, and manufacturing exporter. It is the ‘factory of the world’, an impressive developing country that has lifted 680 million people out of poverty within less than two generations. 

China is the most successful and astonishing story of capitalist success, if sustained growth is our barometer. And since the beginning of this century, it has served as a major importer of raw materials and supplier of goods, loans, and infrastructure for much of the developing world.

Yet, we still, in many ways, live in a “Western” world, where America, Europe and Japan continue to dominate the world of finance, science and technology, development aid, and military.  As some leading scholars have argued, it is unlikely that China will fully catch up with America, let alone the Western world as whole, anytime soon. Not to mention, China is also grappling with its own economic troubles

A cursory look at the Philippines’ top investors, source of remittances, and development aid shows that the “West”, including Japan, remains indispensable to the Philippines. And this is expected to be the case for the foreseeable future. 

In short, as much as we should welcome more Chinese tourists and their appetite for our bananas, the Philippines shouldn’t lose sight of the bigger picture. Manila should ensure that improved economic ties with Beijing would not have any deleterious bearing on the Philippines’ legitimate claims and rights, per the arbitration award at The Hague, in the West Philippine Sea. And keep the NBN-ZTE experience in mind. 

We need to improve our relations with neighbors like China, peacefully manage our disputes in accordance to international law, and expand our areas of cooperation. Duterte’s upcoming visit to China will help in achieving these goals. 

But we also need to maintain robust ties with our tried and trusted ‘all-weather’ friends, who are our best insurance policy in moments of crisis, man-made and natural, and if things go south in the West Philippine Sea.  

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Editor's note: 

Richard Heydarian is an academic, internationally published author, and a widely consulted policy adviser, focusing on Asia-Pacific affairs. This is his second blog/opinion piece for news.abs-cbn.com. He will soon be appearing regularly on the ABS-CBN News Channel (ANC) to give in-depth analyses of current affairs. 

As an academic, he has taught at De La Salle University as well as Ateneo de Manila University in the Philippines, and been invited to talk at conferences in leading universities around the world. His latest book is Asia's New Battlefield: US, China and the Struggle for the Western Pacific (Zed, London). 

Disclaimer: The views in this blog are those of the blogger and do not necessarily reflect the views of ABS-CBN Corp.