China’s investments and PH national interest

The complex geopolitical maneuverings in the Indo-Pacific region have altered the way we view security and economic development. National security can no longer be viewed solely from a military perspective, the same way economic development can’t be measured by numbers alone.

Threats to security and development continue to emanate from the systematic use of political power and the integration of emerging cyber and digital technologies to influence operations. Today, we are witness to how China strategically employs economic statecraft to exploit and manipulate countries and littoral states in the West Philippine Sea (WPS).

Amid mounting clamor against China’s aggression in the WPS and the politically accommodated inflow of Chinese aid, loans, and investments into Philippine infrastructure projects, former ombudsman and Supreme Court associate justice Conchita Carpio Morales, in her keynote in the recent virtual town hall discussion of the Stratbase Albert del Rosario Institute on “Belt Road Initiative (BRI) and Corrosive Capital: Mitigating Corruption Risks in the Philippines,” depicted the BRI as “essentially China’s blueprint to advance its geopolitical interest and an embodiment of China’s dream of increasing its domestic and international power.”

“What is key at this time in history is a matter of proceeding with caution and a matter of understanding the underlying implications of this engagement to the government, to our society, to our sovereignty, and to our future as a nation,” Carpio Morales added.

In turn, John Morrell, regional director of international think tank Center for International Private Enterprise, warned that, “A democratic government simply cannot borrow money from secret sources for secret purposes on secret terms and be considered a democratic government.” After emphasizing the presence of “ironclad non-disclosure clauses” in loan agreements with China, he concluded that, “When an emerging market accepts more money from China, that is statistically correlated with increased levels of corruption in the country that receives it.”

Stratbase ADRi Fellow and De La Salle University professor Edwin Santiago pointed out that, “perhaps the most controversial and inflammatory issue about the CRPIP is the waiver of sovereign immunity in light of the experience of other countries such as Sri Lanka, Djibouti, and Maldives with China. These countries have been reported to have had to give up their strategic national assets.” Further, “at an interest rate of 2 percent, the Chico River Pump Irrigation Project and the Kaliwa Dam project contracts to China were disadvantageous to the Philippines. The two

projects were at an interest rate of 2 percent per annum, whereas we could have gotten them at 0.2 percent from other ODA funded projects such as those from South Korea and Japan.”

With President Duterte’s appeasement policy toward China, expressed in his abject behavior of downplaying China’s aggression and its unproductive financing and developmental promises, the Philippines has obviously fallen prey to Beijing’s influence operations and expansionist agenda. China’s opaque financing practices arrogantly set aside established transparency and accountability mechanisms, which may lead to corruption and other adverse impacts on our security and national development.

The Filipino people expect the President to protect the interests of the Philippines and its citizens, not the interests of a foreign government encroaching on our territories, exploiting our marine resources, and infecting our already fragile economy with corrosive investments. As citizens, we have the right to demand transparency, accountability, and the purging of these harmful foreign investments that are threatening our national security and socioeconomic stability. The Duterte administration must stop its appeasement policy to China and bring its focus back to our national interests.

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Dindo Manhit is the founder and managing director of Stratbase Group.