When President Marcos meets Japanese Prime Minister Kishida Fumio today, security in the South China Sea and the need to replace Chinese funding for key infrastructure projects that dried up when Manila refused to bow to Beijing’s expansive claims will be high on the agenda.
Kishida, on an official visit from Nov. 3 to 4, will meet with the President on Friday and address a joint session of Congress on Saturday.
In a statement on Thursday, the Department of Foreign Affairs (DFA) said the two leaders would discuss the West Philippine Sea and Japan’s official development assistance (ODA) when Mr. Marcos receives Kishida at the Palace Friday.
The DFA also said there was no legal basis for the Chinese claim that the Philippine Navy warship BRP Conrado Yap (PS39) intruded in the waters off Scarborough Shoal, locally known as Bajo de Masinloc or Panatag Shoal, on Oct. 30.
The remarks of the Southern Theater Command of the Chinese People’s Liberation Army would only raise tensions in the West Philippine Sea, the DFA said.
“The Philippines’ conduct of maritime patrols in the waters around Bajo de Masinloc is a legitimate and routine act of a sovereign country in its territory and territorial sea and is part of the Philippines’ administrative responsibility,” the DFA said in a statement.
“There is no obligation for the Philippines as the sovereign state to seek the approval of another when navigating its own territorial sea,” the agency added.
It said that it was China that has been intruding into Philippine waters.
Beijing, which claims the shoal, earlier said a Philippine military ship illegally entered waters near Scarborough Shoal without authorization. It also urged the Philippines to immediately stop its provocations.
China’s statement marked a rare warning from the Chinese military aimed at the Philippines over its moves in disputed waters in the South China Sea.
But the DFA asserted that Bajo de Masinloc is an integral part of the Philippine territory over which the country has sovereignty and jurisdiction.
“The 2016 Arbitral Award upheld its status as a high-tide feature that has no exclusive economic zone or continental shelf of its own as opposed to an island as defined under Article 121 (3) of the United Nations Convention on the Law of the Sea (UNCLOS),” the DFA said.
It also pointed out that China’s claim to historic rights over the region are contrary to UNCLOS.
Earlier, National Security Adviser Eduardo Año insisted that the Philippines has the right to patrol Bajo de Masinloc.
The tit-for-tat exchange between Manila and Beijing heightened following a collision between a Chinese coast guard vessel and a boat from the Philippines.
The US Embassy in Manila called out China’s military for shadowing a Philippine Navy vessel near Bajo de Masinloc, saying the act was “detrimental to regional peace.”
In a statement Thursday, the embassy urged the Chinese government to respect the rights and freedom of all states under international law.
“The PLA’s (People’s Liberation Army’s) persistent swarming and shadowing of the Philippine Navy and Coast Guard – as well as of fishing and other vessels – near Scarborough Reef are detrimental to regional peace and stability,” it said.
“We urge the PRC (People’s Republic of China) to respect the navigational rights and freedoms guaranteed to all states under international law,” it added.
The Chinese PLA Southern Theater Command had confirmed it warned off and “restricted” a Filipino warship, the BRP Conrado Yap (PS-39), after it entered the waters “adjacent to China’s Huangyan Dao” on Oct. 30.
Contrary to international law, China claims it has sovereignty over Scarborough Shoal, which it calls Huangyan Dao.
In an Oct. 30 statement, the Chinese PLA Southern Theater Command said its troops “remain on high alert at all times to resolutely defend China’s national sovereignty and security and peace and stability in the South China Sea.”
A congressional leader, meanwhile, said he sees the Japan International Cooperation Agency (JICA) as the “logical fallback funding source” for the construction of the massive Mindanao Railways Project (MRP) after the Philippine government backed out from loan negotiations with China.
“Our sense is, Japan is our best recourse, considering that JICA is already helping our Department of Transportation in modeling our 30-year railways master plan for Metro Manila, Central Luzon, and Calabarzon,” Surigao del Sur Rep. Johnny Pimentel said.
“JICA is already providing us the extremely low-interest official development assistance (ODA) loans for the Metro Manila Subway and other other rail projects in Luzon. We might as well ask them to double down and grant us the concessional loan for the MRP,” Pimentel said.
“We absolutely need the MRP to accelerate the transfer of people and goods, and drive Mindanao’s economic and social development,” Pimentel said.
Pimentel said he expects the MRP to produce tens of thousands of construction-related jobs and livelihood opportunities that would benefit low-income families over several years.
Phase 1 of the MRP is projected to cost P83 billion and will involve the construction of a 100-kilometer train line linking Tagum City, the provincial capital of Davao del Norte, with Digos City, the provincial capital of Davao del Sur, through Davao City.
The train line will cut travel time between Tagum and Digos from the usual three hours to just an hour.
Phase I will accommodate 122,000 commuters every day in its first year of operation.
Six commuter trains (with five cars each) will be deployed every hour and run through eight stations.
The line will also have 15 freight cars and three spare cars.
As originally designed, the entire MRP will eventually consist of a 1,544-kilometer railway stretching out to the cities of General Santos, Cagayan de Oro, Iligan, Cotabato, Zamboanga, Butuan, Surigao, and Malaybalay.
Transportation Secretary Jaime Bautista said Manila has no regrets about losing ODA loans from China, saying the country is looking at other sources of loans with lower interest rates.
“There are other [ODA] sources, and personally I’m not saddened. No regrets,” Bautista said.
In a letter to Huang Xilian, Chinese ambassador to the Philippines, Finance Secretary Benjamin Diokno informed China that the Philippines is no longer inclined to pursue Chinese ODA financing for the Mindanao Railway Project Phase 1-Tagum-Davao-Digos Segment (MRP-TDDS).
“We inherited this project and since there’s not much movement on the financing, we requested the DOF to help us look for other funding sources,” Bautista said.
“We will look for another funding source; we are working on that now. We can still go to other ODAs like JICA [Japan International for Cooperation Agency], the ADB [Asian Development Bank], WB [World Bank] and other governments that are talking to us,” he added.
Michael Ricafort, chief economist at Rizal Commercial Banking Corporation (RCBC) agreed with Bautista that the Philippines can tap other ODA partners with low interest rates.
Ricafort said that interest rates or borrowing costs would be cheaper from other developed countries compared to loans from China.
“For instance, loans from the Japanese government have near zero percent interest rates,” he said.
The Chinese government, on the other hand, imposed a 2 percent interest rate for concessional and tied loans.
Ricafort said the recent maritime incidents and territorial dispute with China may be why ODA loans from China have dried up.
Aside from the Mindanao Railway Project, other Chinese-funded projects that have yet to be implemented are the P142 billion Philippine National Railways South Long Haul Project and the P51 billion Subic-Clark Railway Project.