New Leaders Forum

Manila Takes on the Goliath

The Scarborough Shoal between the Philippines and China is still rumbling on. Can Manila come out on top?

With the standoff over the Scarborough Shoal (“Huangyan Island” to the Chinese and “Panatag Shoal” to the Filipinos) having entered its second month, many are wondering how long the tiny Philippines will stand its ground as Beijing steps up its diplomatic and military pressure. 

If this were simply a legal matter, the deck would surely be heavily stacked against the Chinese. The shoal is located clearly within the country’s 200-nautical-mile Exclusive Economic Zone (EEZ) and hundreds of miles from the Chinese mainland.

International law also favors the Philippines on another level. Following the Island of Palmas Case as an international legal precedence, Manila’s “actual, effective, and continuous” exercise of control and sovereignty over the Scarborough Shoal gives it the upper hand in any third party international legal arbitration. In fact, in 2010, the northern town of Masinloc (200 kilometers away) claimed the shoal as part of its municipality. 

Just recently, in accordance with the U.N. Convention on the Law of the Sea, Manila was able to secure its claim over the Benham Rise – a maritime region located within Manila’s EEZ to its east in the Pacific Ocean. No wonder, a confident Manila has sought to take the Scarborough dispute to the International Tribunal for the Law of the Sea.

However, territorial disputes are fundamentally about how disputing parties employ all elements of their national power to secure their interest – and this is precisely where the Philippines is heavily outmatched, outspent, and outgunned.

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On the surface, the odds favor the Chinese. In terms of military expenditure alone, the Chinese dwarf all their neighbors across the South China Sea. While the Philippines’ decrepit and under-equipped armed forces subsists on a meager annual expenditure of around  $1.5 billion, ranking 59th in the world, the Chinese are the world’s second largest spenders, with their $100 billion plus budget (a conservative estimate) set to double by 2015.

Facing a paltry navy, with Manila deploying its only warship Gregorio Del Pilar to the area, the Chinese have not only launched new military exercises in the vicinity of the dispute, but also sent an armada of vessels to intimidate Manila.

Moreover, although both countries are signatories to UNCLOS, they have in the past expressed reservations in terms of subjecting their territorial disputes to any kind of international arbitration. While former Philippines President Joseph Estrada made this position clear during his administration, Beijing, in a 2006 written statement to the U.N. general secretary, expressed its unwillingness to subject itself to arbitration over issues such as “maritime delimitation, territory and military activities.” According to China’s notorious 9-dash line, much of the South China Sea region belongs to Beijing.

China also has economic muscle. During the administration of former President Gloria Arroyo, China – through its multi-billion concessionary loans and promise of more projects and alleged kickbacks – was able to influence Manila’s top leadership, culminating in the passage of the 2009 “baseline law,” which effectively abandoned Philippines’ claim to disputed areas in the South China Sea.

Now facing a more independent-minded leadership, the Chinese have resorted to other economic measures to coax the Philippines into submission: the Chinese are utilizing a combination of travel advisories and threats of economic sanctions to intimidate their counterparts into compromise. For instance, China, a $250 million market for Philippine banana exports, has suddenly imposed restrictions on banana imports from the Manila, allegedly due to safety concerns.

Upping the ante, state-backed Chinese media has called for sanctions and punishment for Manila. While the Global Times called for sanctions and blamed the Philippines for stoking tensions in Sino-American relations, the Liberation Army Daily accused the Philippines of hiding behind America’s skirt by stating: “The United States’ shift in strategic focus to the east…has provided the Philippines with room for strategic maneuver…emboldening them to take a risky course.”

In response, the Philippines has used proactive diplomacy to shore-up regional support for its claims. Although the United States has expressed its neutrality over the outcome of any arbitration, lawyers from the U.S. have been providing legal aid, and the U.S. has been bolstering its military options, in addition to announced support earlier this year. Meanwhile, other countries, from Australia to South Korea and Japan have also indirectly increased their military assistance.

So far, one thing is clear: the Philippines isn’t alone in this row, and neither is it in the mood to back off anytime soon.

Javad Heydarian is a Manila-based foreign affairs analyst focusing on international security and development issues. His articles have been featured or cited in Foreign Policy in Focus, Asia Times, UPI, the Transnational Institute and the Tehran Times, among other publications.