PRESIDENT Duterte and China President Xi Jinping agreed Friday on the creation of an intergovernmental joint committee and working group on the joint exploration of oil and gas projects in jointly claimed areas of the South China Sea. This is probably the most important result of their meeting last week in Beijing.
The Philippines needs to replace the Malampaya oil and gas sources that are expected to run out within five years. The Reed Bank oil and gas reserves are estimated to yield up to 5.4 billion barrels of oil and up to 55.1 trillion cubic feet of gas, and the Philippines’ share of 60 percent could be equivalent to almost a decade of annual trillion-peso national budgets. That should boost the Philippine economy to become one of the top in Asia.
Also significant was the agreement for a P16-billion loan to boost the funding for the “Build, Build, Build” program. It will be used to kick-start the P170-billion 600-kilometer Long-Haul Train Project of the Philippine National Railways from Manila to Legazpi City in Albay and on to Matnog, Sorsogon.
Then there is the package of memorandums of understanding and agreement for cooperation – between the Commission on Higher Education and China’s Ministry of Education, the Department of Science and Technology and China’s Ministry of Science and Technology, and the Bureau of Customs and China’s General Administration of Customs, including a container inspection equipment that is certain to cut down smuggling. There was also an exchange of notes on the procedure for the availment of a concessional loan facility between the Department of Finance and the China International Development Cooperation Agency.
In the course of the meeting, President Duterte also raised, as he had earlier vowed, the ruling of the Arbitral Court in The Hague in 2016 which rejected China’s claim to most of the South China Sea, to which President Xi reiterated his government’s position that it does not recognize the ruling and stands by its position.
This was as expected. China claims sovereignty over about 80 percent of the sea while ASEAN nations Philippines, Vietnam, Malaysia, and Brunei also stand by their own claims to certain islands in the sea. The Arbitral Court ruled against China’s claim and declined to rule on any other claim in the sea.
President Duterte and President Xi agreed in their meeting that this contentious issue is not the sum total of the relationship between the Philippines and China and their differences should not derail or diminish the amity between the two countries.
The whole matter will be settled sometime in the future through negotiation and diplomacy, but in the meantime, we must welcome the agreements for aid and cooperation and, most important, the agreement for the joint development of the Reed Bank oil and gas resources that will raise the Philippines’s economy to higher levels of development.
