The Duterte administration’s push for bilateral talks with China — after the favorable arbitration tribunal ruling to the Philippines — will be beneficial for the country in “bringing back” its lost Chinese market in terms of trade, investments and tourism.
The country would likely “leverage” on this ruling, pursuing bilateral talks with China “as equals” to improve trade, investment and tourism relations between the two economies, said George Barcelon, president of the Philippine Chamber of Commerce and Industry (PCCI), and Sergio Ortiz-Luis Jr., president of Philippine Exporters Confederation Inc. (Philexport).
“During his speech in Sulong Pilipinas, the President mentioned improving the trade relationship. So I think, even with this decision, it works in our favor. We will leverage on that in our future discussions, that we have rights over that area. But for us, we should not rush; give it some time,” Barcelon said.
“It would be good if we sit down as equals and discuss how we can share, in trade, and exploration. I think all of these things will come to our country. I think it will not come very quickly; it will take time,” he added.
“Where does it bring us? I think where we were before we start this process. So now, we will probably go with bilateral talks with China, as it had wanted from the beginning anyway. And what will we negotiate? Probably joint exploration, which we already got with before I think we signed with China and Vietnam… I thought we’re going to negotiate anyway,” Ortiz-Luis said.
Ortiz-Luis was referring to the Joint Marine Seismic Undertaking (JMSU) in 2008 between the Philippines, China and Vietnam — an agreement that allowed China and Vietnam to jointly explore the Philippine oil resources in the claimed island territories in the West Philippine Sea.
“Anyway, I think it’s high time now that we recover this market. I think the administration is handling it well, not to further gloat on this because it’s just a paper victory. We are on the moral high ground, but at the end of the day, we’ll still base on what will be the turnout of the future talks. What we lost in the previous years, we’ll now recover if we’re able to talk to them [and have]a good arrangement,” Ortiz-Luis said.
In terms of trade, the Philexport president cited the “banana tale” that caused the country “billions and billions dollars” in potential revenue. He was referring to the incident in March where China trashed 35 tons of Philippine bananas that they labeled as “substandard.”
For tourism, he said the country has suffered sharp declines in Chinese visitors every year after 50 percent growth from this market three years ago. The same trend of slowing Chinese participation was seen in foreign direct investments to the Philippines.
“When we started [in the push for the arbitration], our tourist arrivals from China were negative for a while, and then it slowly recovered to a reasonable degree. A lot of export commitments also did not come, they canceled them,” Ortiz-Luis said.
“So, we negotiate now. I think the way we’re handling it is good. We have the moral high ground, at least that, and when we talk with China, we’ll probably get a good arrangement.
We did not get direct foreign investments from the ones that pushed us to this fight, even from our neighbors. We are the ones bullied, left behind. But I hope we recover it,” he added.
Through the years, China has been one of the Philippines’ top five biggest trade partners, both in exports and imports.