ASSESSMENTS

The Philippines Waits for a Chinese Windfall

Jan 2, 2019 | 10:00 GMT

Chinese President Xi Jinping, right, and Philippine President Rodrigo Duterte, left, inspect the troops during a welcoming ceremony at the Malacanang Palace in Manila on Nov. 20, 2018.

Chinese President Xi Jinping, right, and Philippine President Rodrigo Duterte, left, inspect an honor guard during a welcoming ceremony at the Malacanang Palace in Manila on Nov. 20, 2018. The Philippines has been waiting eagerly for Chinese investment, but the country's internal issues have so far prevented the plans from coming to fruition.

(TED ALJIBE/AFP/Getty Images)

Highlights

  • China's pledges to improve the Philippines' infrastructure on a massive scale have not come to fruition, but the investment might not come unless Manila rectifies some of its internal issues.
  • Despite the comparatively low levels of investment from Beijing so far, Chinese entities are likely to be more amenable to funding projects in the Philippines' distant provinces than their Western counterparts.
  • As the Philippines deals with internal issues, the countries' mutual political will means Manila and Beijing will likely pursue closer infrastructure cooperation during the second half of President Rodrigo Duterte's term.

Since 2016, conciliation with China has been the name of the game for Philippine foreign policy planners. Under President Rodrigo Duterte, Manila has de-emphasized thorny South China Sea disputes in favor of pursuing cooperation with China in the hopes of freeing up resources to quell internal instability while attracting Chinese investment to bolster the Philippine economy and even out the island country's deep regional development disparities. For Beijing, the warmer relations with Manila align with its preference for dealing with each of the South China Sea's claimants on a bilateral basis, along with its overall regional strategy to leverage its economic heft for strategic advantage. As Duterte nears the midpoint of his term in office, the jury is still out on whether his approach has been a success. Despite two high-profile state visits and a raft of pledges, Chinese investment has yet to flow into the archipelago. Ultimately, if China wants...

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