Beijing Review:

Sonia Cataumber Brady: The ASEAN-China Commemorative Summit will mark the 15th anniversary of the ASEAN-China dialogue relationship. It will also be an occasion to assess its progress and to chart its future course in light of the prevailing regional and international situation. The summit will enable ASEAN and China to signal to their respective countries and to the international community their determination to further deepen, broaden and strengthen their cooperation based on an effective partnership that will serve the peoples of China and ASEAN, and the Asia-Pacific region as a whole.

China and ASEAN have had a very active and dynamic relationship. China was ASEAN’s first dialogue partner to accede to the Treaty of Amity and Cooperation in Southeast Asia in 2003. It was the first country to sign a declaration on a strategic partnership for peace and prosperity with ASEAN in 2003. It is also the first country with which ASEAN signed a framework agreement for the establishment of a free trade area in 2002.

ASEAN is China’s fourth largest trading partner. People-to-people exchanges have grown through 29 cooperative mechanisms dealing with culture, energy, agriculture, public health, tourism and nontraditional security issues, among others. ASEAN and China are partners in various regional and international forums, such as the ASEAN Regional Forum, ASEAN+3 [China, Japan and South Korea], Asia-Europe Meeting and the Forum for East Asia-Latin America Cooperation.

The Nanning Summit is expected to reaffirm the commitment of ASEAN countries and China to further the strategic partnership in a way that would ensure the peace, stability and prosperity of the region.

The ASEAN side would like China to continue to support ASEAN’s community-building process, through the Vientiane Action Program and through its investments in the growth areas such as the Brunei-Indonesia-Malaysia-Philippines East ASEAN Growth Area and the Greater Mekong Sub-region.

On the political and security front, both sides should also agree on guidelines and, eventually, specific steps to implement the 2002 Declaration on the Conduct of Parties in the South China Sea, so that we can start moving toward the formulation of a regional code of conduct in the South China Sea.

ASEAN and China should intensify their cooperative efforts to implement the Joint Declaration on Cooperation in the Field of Nontraditional Security Issues, signed in 2002. The Philippines and China can join hands to enhance cooperation and dialogue between ASEAN and the Shanghai Cooperation Organization (SCO). At the moment, only the ASEAN and SCO secretariats have formal links. Considering the common aspirations of the two organizations, I think much more could be achieved if ASEAN-SCO cooperation and dialogue are initiated and pursued.

How do you define the political and economic relations between China and the Philippines within the framework of ASEAN plus China?

Philippines-China bilateral relations are comprehensive and multi-dimensional, as shown by the number of bilateral agreements between the two countries. So active is the relationship that our leaders have characterized Philippines-China relations as being in a “golden age of partnership.”

This partnership is of course boosted by the ASEAN+1 [China] framework. There are as many as 27 cooperative platforms between ASEAN and China that the Philippines actively engages in.

The past 15 years of cooperative relations between ASEAN and China have helped build mutual trust and confidence between the Philippines and China. The 2002 Declaration of Conduct of Parties in the South China Sea between ASEAN and China encouraged the national oil companies of Viet Nam, China and the Philippines to launch a “joint marine seismic undertaking” that could provide a formula for other cooperative activities in the South China Sea, pending the conclusion of a regional code of conduct and the resolution of conflicting claims in the area. As can be seen, because of the constructive role of China in the ASEAN+1 relationship, the Philippines and China have taken concrete steps to turn the South China Sea from a potential flashpoint in the region into an area of cooperation and development.

On the economic front, both sides are building the blocks of an ASEAN-China Free Trade Area. Tariffs on goods are being reduced or eliminated. Both sides hope to conclude soon negotiations on services and investments. Because both ASEAN members and China have their own respective economic strengths, the free trade area will bring greater economic rewards to the individual countries under it and the entire region. With the region as their market, we also hope that businesses and investments outside the region will be drawn to the free trade area.

Economic development is a win-win equation for all. Both ASEAN and China benefit from this relationship. Philippines-China bilateral trade has increased from $3.1 billion in 2000 to $17.6 billion in 2005. We hope to see more investments from China in the region and in the Philippines as well.

What are the key areas of cooperation between the two countries?

Since the two countries signed the joint communique establishing diplomatic relations in 1975, agreements in the areas of trade, investments, finance, agriculture, mining, air services, postal parcels, tourism, culture, sports, youth exchanges, media and information, judicial cooperation, defense, maritime cooperation and combating transnational crime have been concluded. Cooperation in these fields over the past three decades mutually benefited the development of both countries and the well-being of our peoples. This is of course boosted by the excellent relationship between our leaders.

On specific fields of cooperation, I am extremely pleased at the increasing bilateral trade between our two countries. In the first eight months of 2006, bilateral trade amounted to $14.2 billion, increasing 30.9 percent over the same period in the previous year. Based on this trend, we are optimistic that the target of increasing bilateral trade to $30 billion by 2010 will be achieved earlier.

Tourism is also another promising area of cooperation. While tourist travel to the Philippines is currently less than to some of our ASEAN partners, China is our fastest growing market. The number of Chinese tourists who visited the Philippines was 107,456 in 2005, a 300 percent increase from the number of arrivals in 2004. In the first eight months of 2006, tourist arrivals from China numbered 86,543, a 35 percent increase over the same period in the previous year.

In the past five years, China’s economic growth has enabled it to become an active development partner of the Philippines. It has extended valuable assistance in the development of Philippine agriculture through the establishment of the Philippine-Sino Center for Agricultural Technology in 2003, continued exchanges in hybrid rice and corn technology and a farm mechanization program. China is also helping the Philippines establish a railroad that will connect Kalookan in metropolitan Manila to Clark. The project will help develop the Clark Special Economic Zone as a regional service and logistics hub.

On the other side of the coin, the favorable investment climate in China has attracted Filipino entrepreneurs to invest in China. Philippine companies are engaged in food processing, banking, real estate and mall development in various areas of China. Last year, Philippine investment in China amounted to $189 million, which is currently more than Chinese investments in the Philippines. However, business people are currently forging long-term partnerships in mining, infrastructure, housing construction, fishery, energy and health, among other sectors.

China and the Philippines are both developing countries. As they seek development, what opportunities will they offer each other?

As developing countries, both can benefit from each other’s development by investing in each other’s development projects, and in sharing expertise and experience. Both countries want their people to benefit the most from development.

For the Philippines, President Arroyo is pursuing a “10-point agenda” to achieve sustainable economic growth for the Philippines and Filipinos, which involves fiscal discipline, job creation and empowerment of the regions. This is the same as China’s goal of building a well-off and harmonious society.

There are many areas of complementarity that both sides can explore. For example, China may be interested in the Philippine Government’s program to spread progress to all areas of the country through the so-called mega-region economic development strategy. Tremendous business opportunities will accrue following the development of the North Luzon Agribusiness Quadrangle, the upgrading and construction of airports, seaports and infrastructure and irrigation projects.

China’s rapid economic development and demand for mineral resources will also make the Philippines’ mining industry a most beneficial area for cooperation.

On the part of the Philippines, our companies will continue to invest in China and contribute their bit to the development of Chinese society.

The Philippines is also very strong in human resources. Filipinos are in great demand in many countries around the world because of their skills. I understand that some Chinese officials also learned English in the Philippines. The Philippines can continue to share its experience with China in this regard.

What should the two countries do to further promote investment in each other?

There currently is more investment from the Philippines in China than the other way around. Attracting investment from China is a major task for the Philippines. With the continued growth of the Philippine economy and China’s “go global” investment policy, we expect increased Chinese investment in the near future. Two agreements signed during President Hu Jintao’s state visit to the Philippines in April 2005, on investment cooperation and on infrastructure cooperation, provide the framework for Chinese investments in agribusiness, the development of mineral resources, and in infrastructure projects such as railways, energy and construction. These projects will bring mutually beneficial results for the growth of the two economies.

In June 2006, Chinese Commerce Minister Bo Xilai led a powerful business delegation to the Philippines. During the visit, a memorandum of understanding for the eventual establishment of a bilateral “economic partnership” was signed. Areas being considered for cooperation under this partnership include agriculture, housing construction, public works and infrastructure, tourism, mining and energy. Both sides are working on the details of this partnership.

What role do people-to-people linkages play between the two countries?

People-to-people ties are the strongest bases for promoting bilateral relations. This is because the Philippines and China have historical and familial ties that antedate the establishment of diplomatic relations by at least a millennium. The Chinese Filipino community also contributes greatly to the boosting of people-to-people relations.

People-to-people ties are also reinforced by the active cultural program between the Philippines and China. Since 1979, we have signed 13 protocols to implement the cultural agreement between the two sides.

I also have great faith in the role of tourism in boosting friendship and understanding between our two peoples. Thus, we will continue to promote the Philippines as a tourist destination for Chinese, just as hundreds of thousands of Filipinos visit China every year.

As may be seen, the government appreciates the value of people-to-people linkages in boosting bilateral relations. Thus, we will ensure that the relationship continues to grow in scope and depth, not only at the official level but, just as importantly, at the people-to-people level. This will involve active exchanges not only between leaders and officials but also between our two peoples, especially the youth.