BEIJING, China - Philippines might procure defense equipment from China, Secretary of National Defense Delfin Lorenzana confirmed late Sunday.

In a press conference on the sidelines of the Belt and Road Forum here, Lorenzana said the government will sign a letter of intent Monday to deal with Chinese arms manufacturer Poly Technologies Inc.

The decision came after representatives of Poly Technologies, and its mother company China Poly Group Corporation, paid a courtesy call to President Rodrigo Duterte in Beijing Sunday afternoon.

"It's not yet a document. It's a letter of intent to deal with them because they're offering us a lot, a wide array of defense equipment," Lorenzana said.

The official said Philippines will be sending a technical working group to Beijing to inspect the equipment and see what the military needs.

"We don't know yet because we are going to involve the Army, Navy, and the Air Force, what equipment they need," the defense chief said.

"We are not going to choose for them. They are going to choose for themselves, what they need from the Chinese defense industry."

He also assured that arms from the Chinese manufacturer passed NATO specifications.

Lorenzana added China has offered a $500-million loan to the Philippines, which can be used for procuring defense equipment once the military's modernization fund has been depleted.

"We are not saying that we will buy from them, or we will not buy from them, but if we need anything from the Chinese Defense industry then we're going to procure using the loan that they are going to offer to us," Lorenzana said.

The official also cited a $14-billion grant from China last December, which he said would be used to buy 4 fast boats, 200 sniper rifles and several hundreds of rocket propelled grenades for the military by the end of the year.

Responding to concerns on whether this presents a clear conflict of interest amid tensions in the West Philippines Sea, Lorenzana said, "Can we get them? Yes. We should separate our disputes in the South China Sea from our relationships with the Chinese."

China claims most of the energy-rich South China Sea through which about $5 trillion in ship-borne trade passes every year. Neighbors Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have claims.

The previous Philippine government in 2013 filed a case with the Permanent Court of Arbitration in The Hague to set the record straight on maritime boundaries. The tribunal did that last year, and invalidated China's claim to sovereignty over most of the South China Sea.

President Rodrigo Duterte has put the ruling on the back burner and said he will revisit it later in his term.

China and the Philippines will start bilateral consultations on the disputed South China Sea this week, Philippine Ambassador to China Jose Santiago Santa Romana said.

-- With Reuters