Philippines’ deal with China pokes a hole in U.S. strategy

BEIJING >> For years, the United States and its allies have struggled to contain China’s ambitions in the South China Sea, even as China steadily seeded the waters with artificial islands and military installations.

Now, by cutting its own deal with China, the Philippines has suddenly changed the calculus, persuading the Chinese to let its fishermen operate around a disputed shoal but setting a worrying precedent for the United States and its hopes of using regional alliances to preserve its place as the dominant power in the Pacific.

What had been a fairly united front against China’s expanding maritime claims, stretching from Japan to Malaysia, now has a gap in the southeast corner where the Philippines lies, and could soon have another at the southwestern end, where Malaysia is making noises about shifting its alliances.

In both cases, resentment over what is seen as U.S. interference in unrelated problems — a wave of extrajudicial killings in the Philippines and a huge financial scandal in Malaysia — may have contributed to the shift.

The Philippine president, Rodrigo Duterte, is angry with the United States over its criticism of his lethal anti-drug program, in which 2,000 people have been killed, mostly by the police.

In Washington, the ranking Democrat on the Senate Foreign Relations Committee, Benjamin L. Cardin of Maryland, has vowed to block any sale of assault rifles to the Philippine police, Senate aides confirmed Tuesday. While President Barack Obama has criticized extrajudicial killings in the Philippines, blocking weapons sales would be the first concrete U.S. sanction, and would probably only drive the Philippines further from the United States.

Malaysia’s prime minister, Najib Razak, is angry over a money-laundering investigation into what the U.S. Justice Department says is more than $1 billion looted from a Malaysian government fund by Najib’s relatives, friends and associates. Najib is in Beijing this week shopping for military hardware.

“Nobody wants the U.S. to leave the region to China,” said Bilahari Kausikan, ambassador at large for Singapore. “But China is using its economic leverage, its geographic position and its lack of interest in human rights to try and change the balance of influence in a region where the vagaries of American politics are now on stark display.”

The deal between China and the Philippines became apparent over the last week with reports that China had begun to allow Philippine fishermen to operate in contested waters in the South China Sea for the first time in four years, rewarding Duterte for his friendship with Beijing and his coolness toward the United States.

The deal is an informal one, and so far has not been committed to writing, but it seems to give both parties what they want while sidestepping the more contentious issue of sovereignty over Scarborough Shoal, the contested fishing grounds claimed by both China and the Philippines.

China has not renounced its claim over the shoal, nor has the Philippines conceded China’s claim. But the Philippines’ main interest in the territory is fish, and it appears to have gotten that, a victory for Duterte and his popular defense of his country’s important fishing industry.

For China, the concession not only shifts an important U.S. ally into its good graces but also brings it at least partly into compliance with a ruling by a tribunal in The Hague on the dispute.

The July ruling, which China rejects, denied Beijing’s claim over most of the South China Sea. China’s Foreign Ministry said on Monday that it remained opposed to the ruling and that the loosening of its four-year blockade of the shoal was a special “arrangement” for Duterte and “has nothing to do with the so-called award.”

Nonetheless, in allowing Philippine fishermen back into the waters around the shoal, China, whether it admits as much or not, was complying with the part of the ruling that dealt with the blockade, according to Paul S. Reichler, the Philippines’ chief counsel in the case.

“China has suddenly decided to act in a manner that, in fact, complies with one aspect of the award,” he said. “It is a welcome step in the right direction.”

Because the tribunal did not consider the question of sovereign rights, he said, China is not out of bounds in continuing to claim sovereignty over the shoal, nor would the Philippines be, if it did the same.

“Beijing has played a clever diplomatic hand,” said Ashley Townshend, a research fellow at the U.S. Studies Center at the University of Sydney in Australia. “It’s secured a public relations win by lifting the blockade, without forgoing its sovereignty claims over the shoal or even removing its coast guard vessels.”

For Duterte, who has vowed to scale back relations with the United States, including possibly denying U.S. forces access to five military bases in the Philippines, the deal on Scarborough Shoal came with little cost.

A Philippine official, Rep. Harry Roque, who accompanied Duterte on his trip to Beijing two weeks ago, told The Philippine Daily Inquirer that the Chinese had wanted a written document that said the fishermen would be “allowed” or “permitted” to return to Scarborough Shoal, wording that would imply China’s control of the area.

Such wording was “unacceptable,” Roque said, and so the deal was not put in writing or formally announced.

For China there was also little cost. The Chinese still control the area around Scarborough Shoal, and it would be tough for the Philippine government to negotiate a full withdrawal of the Chinese from the shoal, an area China has considered turning into an artificial island to create a military base.

Still, China has lost a point of leverage, Townshend said. “Having now lifted the blockade and drawn global attention to the issue, it will be very difficult for Beijing to reinstate the blockade without incurring serious reputational damage and undermining its political rapprochement with Manila,” he said.

The United States, a bystander to the deal, gave it a kind of provisional approval.

Deputy Secretary of State Antony J. Blinken, saying that he had only read reports, said it would be a “positive development” because it showed that China “is acting consistently with the arbitration ruling.”

Even if it portends a potential strategic loss, the agreement also helped reach a goal that the United States has long sought: lowering tensions in an important area of the South China Sea.

For Duterte, the deal caps a two-week period in which he has shown himself to be a “shrewd political animal,” as Kausikan, the Singaporean ambassador, put it.

In Beijing, Duterte signed $24 billion in infrastructure projects and loans. He left Tokyo last week with the promise of two new vessels for the poorly equipped Philippine coast guard and, according to Philippine news reports, $19 billion in investment and loan pledges.

He also won tacit support in both capitals for his campaign against drugs. Like the Chinese leadership, Prime Minister Shinzo Abe of Japan did not raise the issue of extrajudicial killings and human rights violations.

How long Duterte can ride out his good relations with China and keep up his threats against the United States is an open question.

At a cabinet meeting next week, Duterte will hear a report from the Philippine Defense Ministry on whether to continue to allow the United States access to the military bases, including one at Palawan, close to Scarborough Shoal.

Duterte has threatened to cancel the 2014 accord that gives Americans access to the bases, a decision that Beijing would welcome. Termination of the agreement requires a one-year notice by the Philippine government to the United States.

But the Philippine public remains pro-American and skeptical of China, opinion polls show.

“I think Filipinos are happy to see the fishermen back in their fishing grounds, but I doubt if this meant that there is a significant increase in the 33 percent of Filipinos favorable to China,” said Patricio N. Abinales, a professor of Asian studies at the University of Hawaii.