THE PHILIPPINES IS LOSING ITS CHANCE TO TAKE ADVANTAGE OF A GROWING CHINA
The world’s second largest economy, China is a growing force. Analysts predict it may inevitably overtake the United States by as early as 2016 or as late as 2030. If the experts are right, then the Philippines should begin to deal with China in ways that will benefit, not hurt, its own future developmental goals. Both countries share a common goal: improving the economic status and welfare of its people.
Although China is the second largest economy, its government acknowledges it has problems: a widening household income gap, growing disparity between urban and rural development, and the largest migration of people: over 200 million is said to migrate from the countryside to the city in search of better economic prospects.
The Philippines, which experiences commendable economic growth, also has its own set of domestic problems, among them a high unemployment rate, a rising drug problem and hundreds of thousands of misplaced internal refugees caused by strife between government troops and the Muslim rebels in the south.
David and Goliath
Media like to portray the South China Sea conflict as that of David and Goliath. Recent military action by China reinforce this notion. China’s purchase of its first aircraft carrier dwarfs the largest naval ship in the Philippine arsenal.
The dramatic increase in China’s military expenditure supports views that it is taking the stance of a belligerent bully flexing its muscle. But viewed in a global context, China’s defense maneuvering is more in line with taking protective measures to ensure its survival. It is only the third Asian country to have an aircraft carrier, after India and Thailand. While it may be the largest economy in the Asian region, China is highly dependent on trade.
And if we compare China’s current position to those of its peers in the economic powerhouse BRICS – made up of Brazil, Russia, India, China and South Africa – we find that except for South Africa, and China at that time, each country has one aircraft carrier. By contrast, the U.S. has 11 operational aircraft carriers.
China’s overall increase in its defense budget is in fact the smallest percentage of its gross domestic product among the top military-spenders. According to Henry Kissinger, an authority on China politics and author of the book On China, at the rate China’s coffers are growing, with domestic pressure from some groups for a bigger allocation for its military, China’s recent double digit increase in defense since the late 1990s signals this shift in China’s internal politics.
For the Philippines, with its unresolved issues with the giant, this can be perceived as a direct show-of-force response. However, if we take the recent mobilization as an internal power play, then China’s situation actually reflects a common problem in any country with strong economic growth.
Recent scholarly studies showed Deng Xiaoping actually ushered in the country’s economic miracle by sidelining military interest in 1979 with the promise that the military will be able to share in the economic growth when the country becomes rich. Therefore, its current military development can be characterized as an internal accommodation rather than external reaction.
Perhaps a change in attitude will be easier if there is a shift in perception. Instead of seeing China’s growing assertiveness as Goliath picking on David, we see China instead as a Gulliver among Lilliputians.
In the story “Gulliver’s Travels” by Jonathan Swift, Lemuel Gulliver lands on an island where people were six inches tall. Initially, they thought him a threat and tried to subdue him. Eventually, they learned to live with the giant and benefited from his presence.
Such change in mentality, far from being fatalistic, can lead to cooperation that can benefit both parties.
The Philippines is in an ideal position to exploit the economic growth of China, due to its proximity and its fair treatment of ethnic Chinese business and political leaders. The combined business and financial successes of Lucio Tan, Henry Sy, and others like them is a testament of the Philippines bounty and generosity.
These individuals found success in their adopted country, and it is important that Filipinos share in their accomplishments. This is the challenge on which government and policy-makers ought to focus.
Snub a compliment
Lord Palmerston said, "there are no permanent friends or allies, only permanent interests". For all its rhetoric and balancing act, the Philippines is aware its developmental needs are highly intertwined with that of China. The Philippine government has publicly admitted and insisted that Philippines-China relations is “90 percent positive” in terms of economic, cultural, and other bilateral exchanges. But on the other hand, it heightens public animosity in the form of the "shame game" that the Philippines has employed as one of its arsenal to control the giant's behavior. The incalculable adverse effect on relations are real as China has began to "snub" the Philippines on the international stage.
This cannot be better illustrated than the country’s exclusion in the recent Southeast Asia round of visits by China’s new Foreign Minister Wang Yi and President Aquino not being invited in the ASEAN China Expo in Nanning despite of the fact the Philippines was the country of honor. However, the snub reads almost like a compliment: it assumes that both sides are equal in capacities and abilities, when in fact, the Philippines concede it needs China's economic market. China is the third largest trading partner of the Philippines, but it becomes number one when the figures of Taiwan and Hong Kong are combined. In contrast, the Philippines composes less than 1% of total trade for China.
In such cases, the “snub” may be the least of the Philippine’s problems. With a growing population and one of the highest poverty rate in the region, it can ill-afford to isolate itself from its giant neighbor across the South China Sea. The greatest threat for the Philippines is not to make a mistake on the South China Sea, but to become a pariah.
In the world of international relations, we cannot choose our neighbors, but we can choose our attitude.
The author wishes to thank Kaisa for publishing a version of this piece in its Tulay Fortnightly. @ http://bit.do/kaisa-austin1.