When President Rodrigo Duterte visited China last year, he brought home untold stories of China’s generosity to the tune of over $160 billion dollars. The president was so smitten; he tried to ditch a longtime ally – the United States of America in favor of an old nemesis now turned kaibigan. For some odd reasons, Duterte kept up his petulant whining of how America this, America that like an old spurned lover seeking attention.
Now, it seems the budding relationship with China is entering a new realm as both countries are now talking about joint exploration of the Panatag (Scarborough) Shoal for economic purposes. This idea was advanced by no less than former Speaker Joe De Venecia, the newly minted special envoy for the Asia-Pacific Economic Cooperation. De Venecia is the same guy who convinced former president Gloria Macapagal Arroyo (PGMA) to undertake the joint seismic exploration of the areas near Palawan. That joint project turned out to be a big lemon for the Philippines but reinforced China’s understanding of how much petroleum reserves are down there. So much so that China’s next move was to claim this group of islands as theirs being within their claimed 9-dash line – a claim that a UNCLOS said was bogus.
Despite repeated warnings from Supreme Court Justice Antonio Carpio that the Philippine government, meaning President Duterte, needs to be careful with their words and actions that could be used by China as evidence of the Philippine’s lack of will in implementing the UNCLOS ruling. Now De Venecia’s “brilliant” idea of having China harvest the oil and fish from the area jointly with the Philippines could prove to be another lemon for the Philippines. The reason the first joint project with China did not do well because one of the things China insisted on is for the Philippines to recognize China’s sovereignty over these islands. China will insist again about this sovereignty issue but this time they will have leverage: Duterte’s malleability to China’s wishes because of China’s generosity to the Philippines.
Sanamagan! The loan has not even materialized yet but China and Duterte are already talking as if they are in bed together when all the Philippines got so far is the saliva from the sweet-talking Chinese leader. But let’s pause and look at what the Philippines might be getting into.
First, there will be billions for an infrastructure loan. With such loan come conditions like hiring of Chinese construction companies, Chinese materials, and following their timetables. There was already an earlier report that a blacklisted Chinese company will be back to do business in the Philippines because of these upcoming loans. This alone should already raise alarm bells because of the Philippines’ experience with the North Rail project. That project started off small but ran into cost overruns in the billions because of corruption and lack of seriousness by the PGMA administration to see through a quality project. The aborted NBN-ZTE Broadband deal was another wake up call. But it seems many in government are in deep stupor to not see the albatross that comes with such loans.
If the Duterte administration is serious about getting rid of corruption, here is an opportunity to stop one before it happens. China has been known to impose high interest rates on their loans. Even just half of a percentage over a going rate could amount to hundreds of billions that the Filipino people will have to pay for. There are plenty of lessons to be learned not only from the Philippine experience but other countries too like Vietnam, some countries in Africa and Latin America. Their stories have common themes: poor quality, unfinished projects, excessive costs, or cost-overruns. If the Philippines has a “bridge to nowhere” in Mindanao, Vietnam has a “freeway to nowhere” because the Chinese company constructing it refuses to finish the project unless Vietnam borrows more money for the cost overrun.
The quality or poor quality of Chinese products is an open secret from steel to cement and other products that will find their way into these Philippine projects. Even the cheap firearms and other weapons that China is offering the Philippines for dirt cheap prize, the Armed Forces of the Philippines is resisting to acquire because lives are at stake. Duterte has been stopped from acquiring U.S. made firearms because of his record on the drug war and American legislators do not want their weapons involved in extra judicial killings. Now, Duterte wants to borrow money from Russia to buy Chinese weapons.
Justice Carpio knows what he is talking about because he has become the expert on the South China Sea matter. Carpio’s wisdom is shared by former president and AFP Chief of Staff Fidel Ramos regarding its military alliance with the United States. These gentlemen are urging the Duterte administration to continue to seek such military alliance as a way of checking China because China clearly is hell bent in owning South China Sea by hooks or by crooks. Last month PGMA’s lawyer former Solicitor General Estelito Mendoza opined that the South China Sea saga was quiet during the Arroyo administration but only got heated during NoyNoy Aquino’s term. Perhaps this was Arroyo’s way of sucking up to Duterte given her newfound liberty but the reason the Chinese were quiet during her administration was because they were quietly building military bases on these islands. Her former Public Works secretary and then Zambales governor Hermogenes Edbane quietly issued environmental permits to Chinese companies who literally leveled an entire mountain to use the soil to reclaim these islands.
Too, Arroyo’s lackeys were busy making money quietly from the North Rail project and other Chinese funded projects. Furthermore, it was Arroyo and her people (through the Philippine Mining Act of 1995 that she signed) who quietly engineered a 50-year lease for Chinese mining companies to mine in various sites in the Philippines, send the metals and ores to China and sold back to the Philippines and the West. Now, it is Duterte’s turn to surrender Philippine sovereignty to the Chinese but not so quietly.
Either Philippine officials are unaware or just plain indifferent to the plight of the country and the Filipinos, nickel is a prime commodity that helps promote China’s hi-tech industries and defense capabilities such as satellites and other surveillance systems. Furthermore, to mine nickel ores thousands of trees will have to be cut (Palawan is a recent site), rivers and watersheds polluted, and the environment contaminated from destructive mining practices. China does not care about the damage they are inflicting on the environment or the Filipino people. All they care about is getting what they need and bribing Philippine officials, if needed be, they will do.
Centuries ago Greeks introduced the idea of grand deception through a wooden structure called the Trojan Horse. Brought to the city of Troy as a trophy, the Greeks hid their special forces in the hollow structure and dispersed in the darkness of the night, opened the gates to the city for the conquering Greek warriors who sailed back for the coup de grace. The Chinese are wining and dining the Duterte officials and showered with billion dollar loans. Are we seeing a modern version of the Trojan?