Philippines’ Duterte says Xi offering gas deal if arbitration case ignored

Philippine President Rodrigo Duterte has acknowledged he’s short of solutions for having China adhere to Manila’s arbitration victory in their South China Sea disputes. (File/AP)
Updated 11 September 2019
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Philippines’ Duterte says Xi offering gas deal if arbitration case ignored

  • If Duterte ignores the Permanent Court of Arbitration’s 2016 ruling, China would agree to be the junior partner in a joint venture to develop gas deposits at the Reed Bank
  • The tribunal in The Hague clarified maritime boundaries and the Philippines’ sovereign entitlements

MANILA: Philippine President Rodrigo Duterte said his Chinese counterpart has offered Manila a controlling stake in a joint energy venture in the South China Sea, if it sets aside an international arbitral award that went against Beijing.
Duterte said Chinese President Xi Jinping told him during their recent meeting that if he ignored the Permanent Court of Arbitration’s 2016 ruling, China would agree to be the junior partner in a joint venture to develop gas deposits at the Reed Bank, located within Manila’s Exclusive Economic Zone (EEZ).
“Set aside the arbitral ruling,” Duterte was quoted as telling reporters late Tuesday in remarks provided by his office on Wednesday.
“Set aside your claim,” he said, quoting Xi. “Then allow everybody connected with the Chinese companies. They want to explore. If there is something, they said, we will be gracious enough to give you 60%, only 40% will be theirs. That is the promise of Xi Jinping.”
China’s foreign ministry and its embassy in Manila did not immediately respond to requests for comment on Duterte’s remarks.
The tribunal in The Hague clarified maritime boundaries and the Philippines’ sovereign entitlements, and in doing so, invalidated China’s claims to almost the entire South China Sea. China does not recognize the ruling.
Duterte has sought to befriend Xi, hoping to secure billions of dollars of investment, avoiding challenging China over its activities in the South China Sea, including its militarised artificial islands.
Big setback
Any agreement to forget the arbitral award and team up with China would be a major setback to other claimants, especially Vietnam and Malaysia, which like the Philippines have experienced repeated challenges from China’s coast guard inside their EEZs.
The United States has called that bullying and coercion aimed at denying rivals’ access to their energy assets.
Duterte did not say if he had agreed to Xi’s offer, but said the part of the arbitral award that referred to the EEZ “we will ignore to come up with an economic activity.”
The tribunal said the Philippines had legal rights to exploit gas deposits that China also claims at the Reed Bank, about 85 miles (140km) off the Philippine coast.
The Philippines only accessible gas resources at the Malampaya fields are set to run out by 2024.
A joint project with China has been talked about for decades, but has gone nowhere because of their competing claims. Joint activity could be deemed as legitimising the other side’s claim, or even relinquishing sovereign rights.
Philippine Foreign Secretary Teodoro Locsin on Wednesday told news channel ANC that a preliminary agreement between China and the Philippines would avoid stating which country was entitled to the gas.
“It’s very clear — no legal position is compromised if we enter into this agreement,” Locsin said, adding that putting aside the arbitration case was immaterial, because an international court had already made its decision.
“It’s final and binding,” he added.


Japanese officials cautious on prospects for US trade deal

Updated 17 September 2019
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Japanese officials cautious on prospects for US trade deal

  • A long-sought trade pact with Japan was scrapped when Donald Trump withdrew the US from a pan-Pacific trade agreement shortly after taking office in 2017
  • Trump said he preferred that Washington and Tokyo strike a bilateral deal

TOKYO: Officials in Japan appeared wary over the prospects for a trade deal with the US after President Donald Trump said he was prepared to sign a pact soon.
Japan’s chief government spokesman, Yoshihide Suga, said Tuesday that the two sides are still finalizing details after reaching a basic agreement in late August on trade in farm products, digital trade and other industries.
Suga said Trump and Prime Minister Shinzo Abe are considering signing a deal in late September when they attend the UN General Assembly in New York.
“We are accelerating the work that still remains,” he said. “But I decline to comment further because we have not reached a formal agreement.”
Trump’s notice to Congress, released by the White House on Monday, did not mention tariffs on autos and parts, long a sticking point between the two countries.
It said his administration was looking forward to collaborating with lawmakers on a deal that would result in “more fair and reciprocal trade” between the two countries.
Toshimitsu Motegi, who became foreign minister last week after negotiating the deal as economy minister, said Japan must watch carefully to prevent Washington from forcing any last-minute changes, Kyodo News agency reported.
The agricultural minister, Taku Eto, cautioned against letting down Tokyo’s guard until the final agreement is reached, it said.
A long-sought trade agreement with Japan was scrapped when Trump withdrew the US from a pan-Pacific trade agreement shortly after taking office in 2017.
Japan and the other 10 remaining members of the trade pact, the Trans-Pacific Partnership, then renegotiated their own deal without the US
Trump said he preferred that Washington and Tokyo strike a bilateral deal.
That resurrected the longtime issue of tariffs on Japanese car and auto parts exports to the US and of stiffer duties on US exports of farm and other products to Japan.