Duterte selling out sovereignty for Chinese funding – IBON

June 20, 2019

by IBON Foundation

Research group IBON said that the Duterte administration’s downplaying of the hit-and-run by a Chinese vessel of a Philippine fishing boat in the West Philippine Sea (WPS) shows how it gives more importance to Chinese funding over Philippine sovereignty.

On June 9, a Chinese vessel rammed and sank the Filipino fishing boat F/B Gem-Ver and left the 22 fishermen on board adrift at sea. President Rodrigo Duterte’s first comment on the issue over a week after it happened, on June 17, was to dismiss it as a simple “maritime incident” being played up by “stupid politicians”.  The president echoed the Chinese foreign ministry’s statement a few days earlier calling the boat sinking “an ordinary maritime traffic accident” and warning against “irresponsibly politicizing” the collision.

IBON explained that the Duterte administration’s position is most likely influenced by how it is courting billions in dollars in aid, debt and investments from China. The government is reportedly seeking as much as US$14.3 billion in official development assistance (ODA) from China to finance 29 ‘Build, Build, Build’ infrastructure projects costing US$16.8 billion.

China ODA has already increased by 24,200% under the Duterte administration – from US$1.5 million in 2016 to US$364.9 million in 2018, said the group. China ODA is seen as essential to fund flagship infrastructure projects. Loan agreements with China have already become controversial for having terms disadvantageous for the Philippines and compromising its sovereignty. The most expensive infrastructure project to be funded by China is the Philippine National Railway (PNR) South Long Haul Project worth US$3.3 billion. China is also being targeted to fund the Mindanao Railway Project Phase 1 worth US$677 million.

IBON also noted surging foreign direct investments (FDI) from China. China FDI increased from US$0.4 million in 2016 to US$163.4 million in 2018. Moreover, the Duterte administration also managed to get pledges from Chinese companies of around US$12.1 billion during the second Belt and Road Forum for International Cooperation last April 2019. Prime Minister Xi Jinping also pledged US$148 million in grants to help boost the Philippine economy during the forum.

The Duterte administration is not asserting the country’s sovereignty or upholding the rights of the Filipino fishermen for fear of jeopardizing the China aid and investments it is so eager for, said IBON. It is desperate to stimulate the Philippine economy amidst its sluggish performance. Growth of gross domestic product (GDP) fell to 5.6% in the first quarter of 2019 from 6.5% in the same period last year.  

IBON also warned that China has already been implicated in controversial deals gone bad where governments were pressured to give up strategic assets like ports. China-funded projects around the world have also been hounded by allegations of hundreds of millions of dollars in corruption and overpricing.

IBON said that a truly independent foreign policy includes asserting the country’s sovereignty and upholding domestic economic development including the welfare of all Filipinos. The Duterte administration should stop privileging China in Philippine territory just because it is promising so much financing, the group said. ###