MANILA - The agreement for cooperation on the Belt and Road Initiative that the Philippines and China signed earlier this week calls for stronger infrastructure and trade cooperation while maintaining “mutual respect for territorial integrity and sovereignty” between the South China Sea rivals.
The Memorandum of Understanding (MOU), signed during Chinese President Xi Jinping’s state visit here earlier this week, puts on paper Manila’s participation in the Chinese initiative that seeks to revive ancient Silk Road trade routes to connect Asian markets with economies in Europe.
Under the signed deal, Beijing can finance infrastructure projects and programs proposed by Manila particularly in the sectors of transportation, telecommunications and energy.
For financial cooperation, use of local currencies will be expanded under the said agreement. The Philippines and China will also engage in regular dialogue for economic development and cultural cooperation.
The pact also said cooperation will be pursued in accordance with the "respective national laws, rules and regulations" of the two countries.
The MOU, however, "does not create legally binding obligations" and is merely an "expression of their common aspiration to cooperate on the Belt and Road Initiative for their mutual benefit."
It described the initiative as China's effort to "take its remarkable economic progress and development even further by offering to assist in the development of other countries to help build stronger economies and, therefore, more and richer markets for commercial and culture exchanges along the ancient Silk Route."
The MOU also cited that "the most sustainable growth of a country should not be at the expense of another, and that national progress is not zero-sum game."
The pact was among 29 deals sealed by the Philippines and China during Xi's visit, during which the two sides affirmed improving ties.
It can be recalled that President Rodrigo Duterte in 2016 secured an estimated $24 billion in investment and loan pledges from China to boost his administration's "Build, Build, Build" infrastructure push.
Duterte has accepted Xi's fresh invitation for him to visit China in 2019 for the second Belt and Road Forum for International Cooperation.
The President has set aside the country's maritime disputes with China in pursuit of improved ties with Asia's largest economy.
Read the full MOU below: