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Philippines says it won’t stop doing business with Chinese firms blacklisted by US

Manila Protests (Patrickroque01/WikiCommons)
September 05, 2020

This article was originally published by Radio Free Asia and is reprinted with permission.

The Philippines is not a “vassal state of any foreign power” and won’t cut business ties with Chinese firms that Washington has blacklisted for their roles in Beijing’s militarization of the South China Sea, a spokesman for President Rodrigo Duterte said Tuesday.

The Philippine government will work with these Chinese companies because it is in the “national interest” to complete flagship infrastructure projects in the country involving these firms, presidential spokesman Harry Roque said during a virtual press briefing. Both the Philippines and China are among countries with contending territorial claims in the South China Sea.

“I will be categorical. [The] Sangley project will continue [and] all other projects involving Chinese companies that are banned in the U.S. can continue in the Philippines,” Roque said. “We are not a vassal state of any foreign power and we will pursue our national interest.”

The construction of an international airport in Sangley, a project valued at U.S. $10 billion, involves the Beijing-controlled China Communications Construction Company (CCCC), one of 24 Chinese firms and individuals that were placed on a list of sanctions by the United States on Aug. 26, for what Washington said was their role in constructing artificial islands in the South China Sea.

According to Roque, Duterte stated firmly at a cabinet meeting on Monday night that it was in the Philippines’ interest to complete the airport and other infrastructure projects.

“[T]he president was clear, he will not follow the directive of the Americans because we are a free and independent country, and we need Chinese investments,” Roque told reporters.

According to the Philippine government, in addition to the Sangley project, the CCCC has secured memorandums of understanding for five other local infrastructure projects in Davao, Cebu and the former Clark U.S. Air Force base north of Manila.

Duterte’s decision to keep business relations intact with U.S.-blacklisted Chinese firms came after Foreign Secretary Teodoro Locsin Jr. said on Friday he would “strongly recommend” that the government cut links with Chinese firms, if they were found to be linked to Beijing’s efforts to expand its military footprint in the South China Sea.

Apart from the Philippines and China, Malaysia, Vietnam, Brunei and Taiwan have territorial claims in the South China Sea.

In July, the U.S. declared that Beijing’s claims to nearly all of the South China Sea on the basis of “historic rights” were unlawful.

The Chinese firms and individuals that were blacklisted last week are involved in reclamation activities in the waterway, the U.S. said when announcing the sanctions.

American Secretary of State Mike Pompeo said the sanctioned firms and individuals were involved in China’s extensive dredging campaign in the South China Sea. He also accused China of destroying the marine environment in parts of the sea through its efforts to build military bases.

“Since 2013, the PRC [People’s Republic of China] has used its state-owned enterprises to dredge and reclaim more than 3,000 acres on disputed features in the South China Sea, destabilizing the region, trampling on the sovereign rights of its neighbors, and causing untold environmental devastation,” Pompeo said.

”The PRC must not be allowed to use CCCC and other state-owned enterprises as weapons to impose an expansionist agenda. The United States will act until we see Beijing discontinue its coercive behavior in the South China Sea, and we will continue to stand with allies and partners in resisting this destabilizing activity.”

‘Chinese takeover of Philippine waters’

Pamalakaya, a group representing fishermen on Manila Bay, meanwhile has warned that the Sangley airport project threatens the livelihood of fishermen on the island of Cavite and could be a prelude to a “Chinese takeover of Philippine waters.”

The group also used strong words to describe the CCCC, saying its intentions are not honorable.

Don’t “compromise the sovereignty, environment, and most especially the socio-economic rights of tens of thousands of Caviteno fishermen to pave way for a mega project of an established Chinese plunderer and aggressor,” Pamalakaya said in a statement.

“We call on Governor [Jonvic] Remulla not to lay open Manila Bay to a Chinese firm that is involved in a massive reclamation and construction of military facilities in the West Philippine Sea,” Pamalakaya head Fernando Hicap added, using the Filipino name for the South China Sea.

Hicap, who lives on the Cavite coast, said about 26,000 fishing families could be displaced by the airport project once it is completed.

“We humbly appeal to the incumbent governor of Cavite to completely terminate the airport project,” he said. “The people of Cavite, most especially the fisherfolk, the coastal population, do not need an airport, but a coastal community integrated to a sustainable livelihood.”

For now, though, the joint venture airport project between CCCC and Filipino firm MacroAsia is in its last stages and is scheduled to be finished soon, Remulla said last week.

He added that the local government would immediately end the project if Duterte or the defense department asked it to do so.

Opposition figure unhappy with Duterte’s decision

Risa Hontiveros, a senator from the opposition in the Philippines, doesn’t agree with Duterte’s decision. She alleged that there might be collusion between the Beijing-run firms blacklisted by the U.S. and Filipino officials in China’s construction of artificial islands and military installations in the South China Sea.

Hontiveros has asked the Senate to investigate these connections.

“It’s been recently revealed that Chinese companies that participate in the building of military islands in the West Philippine Sea have projects with the Philippine government, so it is not hard to suspect dubious engagement by either party,” Hontiveros told reporters.

She said China’s construction of artificial islands was a threat to the security of the Philippines, adding that intelligence officials had said these islands were being used as outposts of the Chinese maritime militia to allegedly harass Filipino fishermen.

“It is alarming that the island bases have put the Philippine archipelago within range of Chinese combat aircraft and bombers,” Hontiveros said. “This is a clear threat to our national security.”