Certainly, the massive loans given to the “Build! Build! Build” are starting to cost. As the big infrastructure projects and other loans are taking their toll on the economy. Therefore, the Philippines and President Rodrigo Duterte are trying to collect something. It seems like the Chinese counterparts are getting lots of collateral and salvage the spent funds in Philippines. Because, as the weeks goes by and the ASEAN friends, the one with the upper-hand is China.
This is surely not how Duterte want it too look, as they are having a bargain. There has already been putting into question the control of Benham Rise and the hard-won control of the island there. Still, the Republic haven’t fought with tooth and nail to get it back. This week, it seems like there are more installations on it. The sovereign Philippines are being toyed with by China. They are being fooled and has to accept deals, because of the loans to Beijing. Manila is indebted and has to give concessions. Why else, would this week be filled with new Chinese interference and getting licenses in the Philippines?
Weather Station Controversy:
““It is currently coordinating with concerned government agencies, as well as with the Philippine Embassy in Beijing to verify the existence or non-existence of these alleged facilities,” he said. Panelo earlier addressed this concern on Monday saying Foreign Affairs Secretary Teodoro Locsin jr. will “do his job” once the reports have been verified. China’s Foreign Ministry Spokesperson Lu Kang announced on November 1 that Beijing has already begun operating weather stations on the artificial islands in South China Sea. “These projects are designed to observe the maritime, hydrological, meteorological conditions and air qualities, and provide such services as maritime warning and forecast, tsunami alert, weather forecast, air quality forecast, and disaster prevention and relief,” Lu Kang said in a press conference” (Janine Peralta – ‘Philippines to take action if Chinese weather stations in South China Sea are verified — Palace’ 06.11.2018 link: http://cnnphilippines.com/news/2018/11/06/ph-china-south-china-sea-panelo.html).
“One of the projects included an exploration between state-owned Philippine National Oil Company (PNOC) and Chinese state-owned CNOOC Ltd., located off Calamian in southwestern Palawan province, Cusi told Manila Bulletin in a news briefing. Cusi was referring to Service Contract 57 which covers an oil and gas project awarded to PNOC’s exploration unit, and picked CNOOC as a partner. Cusi did not share details for Service Contract 72, an exploration permit held by the Philippines’ PXP Energy Corp. for Reed Bank, but clarified that the Reed Bank, another disputed South China Sea area, is not of the two” (Meanne Rosales – ‘ PH to seal 2 exploration deals with China’ 09.11.2018, link: https://powerphilippines.com/2018/11/09/ph-seal-2-exploration-deals-china/)
Chinese Telecommunication as the Third Telco:
“Philippine President Rodrigo Duterte has lauded the entry of China Telecommunications Corp., or China Telecom, in his country’s telecommunication industry, saying the Philippines stands to benefit from the “good competition” that a Chinese company will bring to the industry” (…) “Duterte said that China “has proved to be of very incredibly high quality of electronics.” “(Xinhuanet – ‘Duterte welcomes China Telecom’s operating in Philippines’ 08.11.2018).
As we see, the sudden Benham Rise in the South China Sea and the will of China to takeover the place, while the Malacañang are preoccupied with sneering at priests, Rappler and who else who hurt their pride. They are not seeing or looking away from the sovereign implications on Benham Rise. As there are talks already of military installations, but now also monitoring equipment and a weather station. Clearly, the Chinese sees it as their land, while the PH are busy trying to find out what is happening there.
Than, you have the oil-fields in the same region, where the Chinese National Offshore Oil Company (CNOOC) have gotten licenses to drill oil there. Clearly, this is all intentional, as well as they are the lucky third Telecommunication Company and getting into the Cellphone business too. This is just fitting as a glove. They are both getting territory in the South China Sea, they are getting exploitation opportunities and steady profits through a cell-phone carrier. All this they have gotten for dropping some loans, that is hard for the Philippines to repay in cash.
That is why they are allowed to get these things, as collateral for the debt. This is a game the Chinese plays well. That is why this is all happening. We have seen similar efforts done in Sri Lanka. That will surely happen in the Philippines too. As the Chinese is not forgiving with their loans. They want points on the dollar. Not loose money and certainly not lose face on the investments made. Peace.
“If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.” – John Maynard Keynes
There are worries about the rising levels of debt the Philippines has to China. That should worry all Filipino. Since, this will be repaid, even as the infrastructure projects under the President is served now. The time for repaying these debts will come. This might be the next one after President Rodrigo Roa Duterte might have to answer for that. But he should be worry himself of the levels he is putting the Republic in, unless he wants important parts of the infrastructure be “given” to the Chinese as a way of repaying the debt like Sri Lanka did.
“The conclusion of an agreement with China to manage the Hambantota port was seen as inevitable after the government buckled under Chinese pressure when the China Communication and Construction Co Ltd, which was building the port city, demanded USD 143 million as compensation for the stalling of the work. The Sri Lankan government was also compelled to renegotiate the Colombo Port city project last year, which had been suspended due to criticism about the Chinese ownership of 20 hectares of freehold land as well as controversy over the project’s possible negative environmental impact” (Smruti S. Pattanaik – ‘New Hambantota Port Deal: China Consolidates its Stakes in Sri Lanka’ 17.08.2017).
This story should be worrying for the Philippines as the rising debt to China will come to roost one day. Duterte has accepted and taken it for his projects, but will it be sustainable. That is something he himself should ask himself and also if they can repay this debt without paying a high price.
Jovito Jose P. Katigbak reported in June 2018 this: “Another issue worth noting is debt sustainability. There are concerns that borrowing heavily from China will lead the country into a debt trap. A 2017 Forbes article contends that the Philippine government debt could swell up to USD 452 billion by 2027, which translates to a debt-to-GDP ratio of 197 percent. The estimated figure is based on an annual 10 percent interest rate on loans levied by the Chinese government, hence tying the Philippines into a “virtual debt bondage”” (CIRSS Commentaries – ‘BRIDGING THE INFRASTRUCTURE INVESTMENT GAP THROUGH FOREIGN AID: A BRIEFER ON CHINESE ODA’ June 2018).
If the Filipino doesn’t get to worried about the amount they are borrowing from China. It isn’t only Sri Lanka who has eaten over more debt than they can swallow and has to repay with other means. There are worry in the Pacific island of Tonga.
As reported from Tonga: “Chinese aid in the Pacific region has increased dramatically in recent years and the country has become the region’s second-largest donor. Tonga’s debt to China has been estimated to be more than $100m by Australia’s Lowy Institute think-tank. The prime minister told local media last week that countries would get together to ask the Chinese government to “forgive their debts”. “To me, that is the only way we can all move forward, if we just can’t pay off our debts,” he added. Beijing has refused to write off loans in the past but has given Tonga an amnesty on repayments” (Simone Rench – ‘Tonga premier to ask China to ‘forgive’ Pacific debts’ 21.08.2018 link: https://www.publicfinanceinternational.org/news/2018/08/tonga-premier-ask-china-forgive-pacific-debts).
We have seen what the Chinese done to the Sri Lankan and Tongan counterparts. Both of instances could be happening to the Philippines. Not that you wish that, but the repayments of the growing debt will happen at one point. Even if there is long grace-period of lower rates on the interests as promised to Manila. You can wonder when the Beijing want to recoup the funds and the debt.
Right now, Duterte has a good relationship with Beijing, but when do they feel they have invested enough in the Build! Build! Build! (BBB) projects and wants profits and returns on the investments?
Because the Chinese will not do this forever. They might act nice at first and investing in infrastructure projects as a part of the Belt and Road Initiative (BRI), but when time goes by and lack of repayment hits the fan. The familiar faces of Beijing will get their value for the money and the sovereignty will be taken away. As a port, a piece of mines or exploration of some sort of industrial output will go directly to Beijing and a state owned company. Since they will get their repayment for all the offered debt to the nation.
That is what Duterte is risking, if it is oil exploration and extraction, mineral resources or even ports that is vital to the business done in the Philippines. Does he wants to risk that for the signature building of the BBB?
“DON CORLEONE: Remember my new Consigliere, a lawyer with his briefcase can steal more than a hundred men with guns” (The Godfather, 1972).
In June 2018, President Trump and President Jong-Un signed a new agreement, which wasn’t particular special. There was no promise or change from the 1994 agreement. Therefore, the sudden rush of Secretary of State Mike Pompeo to arrive in Pyongyang is showing, how misunderstood the Trump Administration has off it all. They have misunderstood the agreement and the diplomatic measures. Not that Trump has the wits to understand the trick the North Koreans has pulled-off. But they signed an agreement without technicalities and without measures securing denuclearization of the Korean Peninsula. Because on the 12th June 2018, they signed to: “ the DPRK commits to work toward” and that is not stating when or how. That is a vague statement, that could mean starting tomorrow or next century. Therefore, the Trump Administration haven’t gotten anywhere closer, than they were in 1994. Even if the Administration and the President itself thinks so.
What is why Secretary Pompeo suddenly continued on the “progress” as he thought he could ambush the Party and the dictatorship. They have already a clear statement and also shown the world, they are not ready to played by Washington D.C. leadership at this point. That Pompeo thought he could play this one easily out, than the previous administrations would have done the same. However, that has not worked.
DPRK have answered to Pompeo:
“The U.S. is fatally mistaken if it went to the extent of regarding that the DPRK would be compelled to accept, out of its patience, the demands reflecting its gangster-like mindset. A shorter way to denuclearization on the Korean peninsula is to remove deep-rooted mistrust and build up trust between the DPRK and the U.S. For this, both sides should be bold enough to be free from old ways which had only recorded failures and resolve the problem in a fresh manner which is never bound by the existing ways. A shortcut to it is also to take a step-by-step approach and follow the principle of simultaneous actions in resolving what is feasible one by one while giving priority to creating trust. But, if the U.S., being captivated in a fidget, tries to force upon us the old ways claimed by the previous administrations, this will get us nowhere” (KCNA: Foreign Ministry Spokesman on DPRK-U.S. High-level Talks, 07.07.2018).
If the Trump Administration thought this would be a straight forward easy game, than they are wrong. As the United States isn’t the most interesting partner for North Korea, that is China and South Korea. They are more cordial with diplomatic missions, but that is not the way of this United States. The erratic and unstable administration, who works on any whim of the President, instead of trying to figure the world out. They are blasting into the dry-wall and hoping nothing hits back.
The DPRK are not to be fooled and have calculated the efforts, all their efforts and thanks for the Singapore Summit in June, the President has gotten more respect is less lonesome in Pyongyang. He has more respect and more places to go than Beijing and Seoul. The North Korean leadership has more leverage and United States has given away theirs for a signature drive in Asia. What a waste of skin and possibility.
That is why “walking towards” can means a lot, but with no time-lines, not mechanisms or anything considering monitoring any level of progress, the North Koreans could do whatever, as the symbolic agreements is as worthless as the pen used by the Presidents.
Pompeo should have known this, but his attitude and arrogance, combined with the lack of tact, is the reason for the gangster-like ways. They are trying to ambush and change the ways of the DPRK without offering anything. That will not work, but than again, the US has lost their leverage and given way for the conference in June.
They just haven’t understood it yet. Because the Trump Administrations isn’t that educated or wise.
“Ted: Say what you will, but it’s a law of nature.
Marshall: Lawyered!… of nature” (How I Met Your Mother – The Playbook – Season 5, Episode 8, 2009).
Trump and his administration have been lawyered! Peace.
Today, Donald J. Trump might thinks in his mind, that he with this signature has done a masterstroke. Just like William Clinton thought in October 1994. That he was the master chief and the key statesman who gotten peace on the Korean Peninsula. However, there aren’t much difference in today’s agreement from 12th June 2018 and the 21st October 1994. Especially not the ball-park. Dennis Rodman might be new feature in diplomatic circles, but the agreement is like rehashing old ideas and putting some paint on it.
First the key part of the 21st October 1994:
“Both sides will work together for peace and security on a nuclear-free Korean peninsula.
1. The U.S. will provide formal assurances to the DPRK, against the threat or use of nuclear weapons by the U.S.
2. The DPRK will consistently take steps to implement the North-South Joint Declaration on the Denuclearization of the Korean Peninsula.
3. The DPRK will engage in North-South dialogue, as this Agreed Framework will help create an atmosphere that promotes such dialogue” (US-DPRK AGREED FRAMEWORK / SIX-PARTY TALKS, 21.10.1994).
Second the key part of the 12th June 2018:
“Convinced that the establishment of new U.S.-DPRK relations will contribute to the peace and prosperity of the Korean Peninsula and of the world, and recognizing that mutual confidence building can promote the denuclearization of the Korean Peninsula, President Trump and Chairman Kim Jong Un state the following:
1. The United States and the DPRK commit to establish new U.S.-DPRK relations in accordance with the desire of the peoples of the two countries for peace and prosperity.
2. The United States and the DPRK will join their efforts to build a lasting and stable peace regime on the Korean Peninsula.
3. Reaffirming the April 27, 2018 Panmunjom Declaration, the DPRK commits to work toward complete denuclearization of the Korean Peninsula.
4. The United States and the DPRK commit to recovering POW/MIA remains, including the immediate repatriation of those already identified” (Joint Statement of President Donald J. Trump of the United States of America and Chairman Kim Jong Un of the Democratic People’s Republic of Korea at the Singapore Summit, 12.06.2018).
You either get taken by hook or the crook. But I am not eating it. This is like Kim Jong-Ill walked in the flesh and became more tolerable, the same has Kim Jong-Un now done. Both of them got the bargain for committing to do something, while not really doing it. The same can happen now. The regime in Pyonyang can do as they please anyway. Trump got a photo-op and actually a token of peace, without really co-signing anything. If he will commit to it, time will tell, because he has torn every other deal apart. But genius in deal-making he is not, than he has to give credit to Clinton. Who practically did the same in 1990s and I doubt Trump will share credit.
Because to to me, “take steps towards” and “commits to work toward” is really mediocre in language sense. There is no timeline, there is no scheduled affairs and nothing that would stop the DPRK from not continuing. This is like writing a letter of intent, but not ratifying it into law. So they don’t have to do it, they might consider to do it, I suppose, but nothing other than with intent.
There more hold in the NDA Micheal Cohen have crafted to Stormy Daniels to silence her, than what they agreed upon to stop the North Koreans from continuing their path to nuclear warheads. That says something. Peace.
Well, let’s be honest, Mr. Trump, the American President isn’t a good negotiator, neither a deal-maker, he is a fraud and fake. That is why he is not succeeding here; he hasn’t staffed the Department of State properly, neither worked for the long-con, when conserving diplomacy. Usually he back-offs of deals and doesn’t create them. The ones he has put his names on, are questionable at best and just ask the manufacturing companies he signed off on during the campaigning. Wonder how well they are doing now, well, they are sacking employees after the state offered cash-up-front and now they are moving over-seas. Such a grand old dealer, more like snake-oil salesmen, the world can see from a mile away.
Therefore, after the Americans and South Koreans went ahead with military practices, they knew this was bad timing, as everything are supposed to be slowly moving and gently move to the gathering of the all the stakeholders and negotiate at the summit. However, that seems likely more far-fetched. Even if Mike Pompeo continues to boost Kim Yung-Un and his brigade, he is more worried about the military exercises in South Korea, than anything else!
That is why it is foolish to believe Trump could pull this off. He is more likely starting a war, because someone mentions the size of his hands or anything else personal about his appearance. Nevertheless, that is just a sidetrack, first part of the statement from DPRK, before what Trump said a few days only!
North Korean Statement today:
“The historic Panmunjom Declaration cannot be implemented by the unilateral efforts of a single party but can result in a good fruition only when the two parties create favorable conditions and climate by pooling their efforts. We cannot but take a step of suspending the north-south high-level talks scheduled on May 16 under the prevailing seriously awful situation that a mad-cap north-targeted war and confrontation racket are being kicked up in south Korea. The south Korean authorities, lost to all senses, should be held wholly accountable for the scuttled north-south high-level talks and the difficulties and obstacles in the way of the north-south relations. The U.S. will have to think twice about the fate of the DPRK-U.S. summit now on high agenda before a provocative military racket against the DPRK in league with the south Korean authorities. We will closely watch the ensuing behavior of the U.S. and the south Korean authorities” (KCNA – ‘KCNA Blasts U.S. and S. Korea for Staging Large-scale Military Drill against DPRK’ 16.05.2018).
Well, this was Trumps statement on the 10th May:
“This is a great honor. Hopefully everything is going to work out at the highest level. We want to thank Kim Jong-un, who really was excellent to these three incredible people. They are really three incredible people. And the fact that we were able to get them out so soon was really a tribute to a lot of things, including a certain process that’s taking place right now. And that process is very important. So we will see what happens. We have a meeting scheduled in a very short period of time. You’ll be hearing about it soon. We have the location set. And we will see if we can do something that people did not think was going to happen for many, many years, and a lot of bad things could have happened in between” (Donald J. Trump – ‘Remarks by President Trump at Arrival of Americans Detained in North Korea’ 10.05.2018).
Clearly, Trump isn’t a diplomat and never has been. That is proven, he doesn’t have the mental capacity or the understanding of a massive take this would be. Since, they didn’t think it was a bad idea to continue practicing their weapons and equipment close to a summit. It just shows, that they expected DPRK to wind down their nuclear operations, and still continue like yesterday across the border. Even if you don’t like the DPRK dictatorship or anything it stands for. It is still within reason, to expect both parties to change activity and show goodwill. Not only the DPRK. That Dictator Kim Yung-Un is far from angel is shown by his acts against the ones seemingly being his enemies. However, when your negotiating and trying to figure out a deal or an agreement, you should carefully cross the rivers, not bulldoze it.
That is what the United States with South Korea has done, instead of postponing it and even notify the opposition North of the border. They have continued like everything is cool. Without thinking about the consequences. That is why the DPRK calls it provocations. That is happening as the DPRK promise to demolish their nuclear facilities. However, who knows if they will do that now. They clearly got the upper-hand and played smart, while the US in particular has played right into the dictators hand. They have forgotten key principals, as they should walk carefully and find a positive narrative before the Summit. Instead, they have made it worse and now the DPRK might not even show-up.
Trump doesn’t know this, because he don’t study, he don’t practice and his partly never listen. That is why he suck as a diplomat and as someone who has this sort of play at stake, he should be selling chicken-wings and not peace. That is something he cannot carry. That is proven, the load is too heavy for him. Time to watch Fox & Friends and forget the summit. He will just make it worse. Peace.