New Era of China—Philippines Relations

By Wang Fengjuan

Chinese President Xi Jinping paid a state visit to the Philippines recently. It was the first state visit to the Philippines by a Chinese head of state in 13 years， a milestone of historic significance in the China-Philippines relations with a profound impact on the future.

During the visit， President Xi Jinping conducted talks with President Rodrigo Duterte， and had a joint meeting with the House Speaker Gloria Macapagal Arroyo and Senate President Vicente Castelo Sotto III. The heads of the two countries jointly charted a course for future China-Philippines relations， and reached consensus on establishing a relationship of Comprehensive Strategic Cooperation based on mutual respect， sincerity， equality， mutual benefits and win-win cooperation. They also witnessed the signing of bilateral cooperative documents， including Memorandum of Understanding （MOU） on Cooperation on the Belt and Road Initiative and MOU on Cooperation on Oil and Gas Development.

Earlier this year， President Xi Jinping met with President Rodrigo Duterte on the sidelines of the Boao Forum for Asia Annual Conference in China， during which time they reached important consensus on further consolidating and developing bilateral relations.

New Golden Era

Before the visit， President Xi published a signed article titled “Open up a New Future Together for China-Philippines Relations” on three Philippine newspapers Philippine Star， Manila Bulletin and Daily Tribune， pointing out that the main goal of the visit was “to have in-depth discussions with President Duterte on how to elevate our all-round cooperation under new circumstances and make an overall plan for greater progress in our relationship toward a higher level.”

“President Xis visit to the Philippines took place at a critical time for the upgrading of our bilateral relations，” commented Zhao Jianhua， Chinese Ambassador to the Philippines. Practical cooperation in various fields has resumed comprehensively. China-Philippines relations are entering a sparkling new golden era. The leaders of the two countries have made a new strategic plan for the development of bilateral relations. They have exchanged views on issues of common concern and drawn a new blueprint for joint development.

Over the last two years， various bilateral cooperation mechanisms have resumed successively， with fruitful results in cooperation in politics， economics， culture， humanitarian efforts and other spheres.

In terms of political exchange， President Xi and President Duterte have met five times on bilateral and multilateral occasions. Political parties， parliaments and government departments of the two sides have strengthened exchange. Leaders of the two countries have established solid mutual trust and friendship as they have taken great strides in driving the improvement of bilateral relations and pointing future development towards the common interests of the two peoples.

“There is tremendous room for cooperation between the Philippines and China， and we are finally seeing a healthier rate of exchange between these two neighboring countries，” opined Gloria Macapagal Arroyo. “Both the President and I believe that Philippines-China relations will enter a booming period of development.”

Over the last two years， work on the Pasig River Bridge and Chico River Pump Irrigation Project has started. Other major projects such as the Kaliwa Dam， Safe Philippines Project， Philippine National Railways South Long Haul Project， China-Philippines Industrial Parks， Panay-Guimaras-Negros Inter-Island Bridge and the Davao City Expressway are progressing smoothly. China is firmly supporting the Philippine government to promote its “Build， Build， Build” infrastructure program through concrete actions， evidencing that China is the most reliable and trustworthy partner for economic development.

In 2017， trade volume between China and the Philippines surpassed US$50 billion for the first time. Now， China is the Philippines largest trading partner， largest export market， largest source of imports and the second largest source of tourists. Meanwhile， Chinese investment in the Philippines has been surging. In the first half of 2018， China was the third largest source of foreign investment in the Philippines.

“The Philippines and China are maintaining close friendly relations，” commented Joseph Estrada， former President of the Philippines and current mayor of the City of Manila. “President Xis visit will deepen pragmatic cooperation in many fields and consolidate friendship between the Philippines and China. The Philippines and China， both Asian countries， have a natural close relationship. Many overseas Chinese and their descendants living in the Philippines have also become the natural carriers of friendship between the two countries.”

Moving Up the Value Chain

In early November， with support from the Center for International Trade Expositions and Missions （CITEM）， the Philippine Department of Trade and Industry joined 47 Philippine companies and institutions in attending the first China International Import Expo （CIIE） in Shanghai. The Philippines country pavilion was themed “joining hands with the Philippines to create value together，” and featured its achievements in trade， investment， tourism and other fields. It also recounted milestone events in Philippines-China relations since the 16th Century through traditional performances and video presentations.

“Chinas growing consumer market provides great opportunities for Philippine food exporters，” remarked Nora Terrado， Undersecretary of Trade and Industry of the Philippines. Food manufacturers attending the expo exhibited everything from processed foods such as fruit juices and snacks to natural ingredients such as coconut sugar， noodles and bottled ready-to-eat dishes and sauces.

Philippine enterprises amassed purchase orders worth US$108 million in addition to the US$16 million in direct sales achieved at the expo. “The numbers exceed all of our targets for this event，” reported Ramon Lopez， Secretary of Trade and Industry of the Philippines. “This has been a big win for Philippine companies， especially those in agriculture， as we push for greater promotion of our fresh fruits in Chinas huge market.” The Philippine government is already planning to send more exhibitors to next years CIIE.

During the expo， the Philinonimorinda Citrifolia Company established contact with a group of Chinese importers seeking cooperation， which will further open up the Chinese market. CEO Tito Contado declared that their attendance next year is certain.

Synergy of Development Initiatives

During his visit to the Philippines， President Xi conducted an in-depth exchange of views with his counterpart on further promoting cooperation in infrastructure， economics and trade， investment， culture and other spheres within the framework of the Belt and Road Initiative （BRI）. China is willing to provide comprehensive support for the economic and social development of the Philippines with practical action， and will work to ensure that the two peoples share more dividends of the development of China-Philippines relations.

The BRI is now generally accepted among the Philippine people. Arroyo believes that the BRI offers development opportunities for participating countries， enabling them to complete infrastructure and investment projects faster and more efficiently. This has been the case for the Philippines. Infrastructure construction in the Philippines has been relatively slow. Construction of railways， ports and other infrastructure needs acceleration. The BRI will unleash enormous business opportunities for bilateral economic and trade cooperation and development.

Xu Ningning， executive president of the China-ASEAN Business Council， believes that the economies of the two countries are highly complementary. President Xis visit will tighten the two countries economic policies and interests and promote more cooperation within and between industries.

“The Philippine economy is growing fast，” noted Xu. “The country has abundant resources and a huge consumer market. Strengthening industrial cooperation between the two countries is conducive to promoting bilateral economic and trade cooperation， which will in turn consolidate and upgrade the strategic partnership.”

Xu has long been engaged in promoting economic and trade cooperation between China and ASEAN. He attaches great importance to the development of relations between SMEs in China and ASEAN countries. He sees many business opportunities in China and the Philippines. However， there are limitations for the SMEs to seek cooperation opportunities. The governments and business councils of both sides have a bigger role to play to get them connected.

Meanwhile， Xu suggests that Chinese companies who wish to enter the Philippine market should fully understand the local industrial policies and plans and abide by local laws and regulations to ensure mutual benefits and win-win development.

“The Philippines is a natural partner within the framework of the BRI because the program complements well the ‘Build Build Build program of the Philippines，” commented Hong Chih-hsiang， president of the Filipino-Chinese Chamber of Commerce. “President Xis visit has been warmly welcomed by our chamber. We look forward to more positive economic and trade cooperation and continuous consolidation of the friendly relations between the two countries.”