Deteriorated

There is little that could be done about the deterioration of our bilateral relationship with China – unless the aspiring Asian superpower abandons its outlandish territorial claims over the entire South China Sea.

Last week, the Philippines withdrew its request for Chinese financing for a major rail project saddled by charges of corruption. It is unlikely the country will seek any more financing from Beijing.

Apart from rising geopolitical tensions, the cancellation of our request for financing is burdened by the high interest China charges. The loans, too, come with strings attached. China requires us to award the projects to Chinese contractors.

We have better options. The massive infra projects could be financed by contracting official development assistance from other countries. Japan and South Korea are ready to offer support in this regard.

Or else, the projects can be undertaken entirely by Filipino conglomerates. Both San Miguel and Metro Pacific have demonstrated remarkable capacity for building large infrastructure projects. Between them, they operate all our tollways.

The newfound alliance between Metro Pacific and San Miguel produces astounding financial and engineering synergy. The two conglomerates are partnered to build a new expressway that cuts through Batangas. The project is expected to be completed in four years.

The possibility that the payments system for all our expressways can finally be unified. That can happen even ahead of the integration of the payments systems for our fragmented light rail systems.

SMC’s Ramon Ang has expressed interest in building tollways all the way to the Bicol region. He has shown interest in investing in our decrepit rail system.

We wasted two decades trying to build the North Rail system. So much money was lost to corruption during those years and all we have are the abandoned posts of what should be a profitable rail line. Without a rail link to Manila, all the grand plans for the Clark Zone cannot be realized.

The New Manila International Airport that is being built in Bulacan will have its own expressway and light rail link. That massive project includes an industrial estate ready to absorb high tech industries abandoning China.

Our people trust the private sector more than government in getting large infra done. The experience of the past few years reinforces that. We do not have to deal with the vagaries of geopolitics to get the projects done.

In addition to cancelling our financing requests, the Philippine government showed willingness in building up our Coast Guard capacity over the next few years. We have one of the longest coastlines. We need to have more ships to guard against smuggling and piracy – not to mention the encroachments of alien ships laying claim to our waters.

That brief skirmish between Philippine boats supplying our troops stationed at Ayungin Shoal and China Coast Guard and maritime militia vessels blocking them from doing so drew worldwide condemnation. First the Chinese vessels aimed a powerful laser beam at our vessels well within out territorial waters. Then they used water cannons against our boats. They put up a funny blockade at the mouth of Scarborough Shoal. Now they are engaging in dangerous maneuvers in the high seas to disrupt our supply lines.

Beijing wants to see the BRP Sierra Madre scuttled and Philippine troop presence at Ayungin ended. That will not happen.

The rusting hull of the BRP Sierra Madre might be unsightly. But it is a monument to our craftiness and our determination to protect our exclusive economic zone. The ship was deliberately grounded but kept on the roster of commissioned Philippine Navy ships manned by our brave Marines. An attack on the BRP Sierra Madre will activate our Mutual Defense Treaty with the US.

No wonder Beijing hates this rusty vessel. It is a reminder that, for all the might of its navy, a small but scrappy country could outwit them.

By happy accident, a US aircraft carrier group visits Manila just days after the last Ayungin skirmish. That visit was planned a long time before. But it could not have arrived at a better time as small Philippine boats run through the massive Chinese boats in the disputed waters.

In obvious response, China appears to have deployed its own carrier-led battle group to the South China sea. This was reported by Taiwan the other day.

Unless this carrier-led fleet is deployed for battle, it is nothing more than a desperate attempt by Beijing to conceal a series of tactical defeats in the contested waters. First, a single Filipino diver cut the floating barricade Chinese vessels put up at Scarborough Shoal. Second, the crude attempt of Chinese vessels to block Philippine resupply ships at Ayungin was failed miserably.

China keeps hundreds of ships spread across the contested waters to shoo away small fishermen and intimidate our Coast Guard – to no avail. That flotilla is maintained at great cost to impress the countries in the region about the seriousness of her territorial claims. What it has produced so far is a David-versus-Goliath situation where a smaller power constantly outwits the lumbering regional giant.

Soon the Philippines will file cases for damage to our national resources caused by the presence of so many Chinese boats. This will open another field of engagement where China’s maritime superiority will be to no avail.

There is little on the visible horizon that will help improve our bilateral relations. Beijing must realize that its strident territorial claims can only ensure her further isolation.