The Philippines on Biden Time: Filipinos revisit self while caught between a rock and a hard place

COVID-19's swath of horror hasn't subsided yet as 2021 enters the glade. The Philippines is the 28th worst-hit nation based on W.H.O. pandemic tally although Asia is the least-devastated region, so far. Meanwhile, the administration of President Rodrigo Duterte stays sunk in a murk of widespread criticism of leadership ineptitude and human rights violations, with or without the coronavirus.

            An utter inability to work around a sociopolitical clime that'd please the Philippines' perennially calamity-battered and culturally fragmented 109.5 million population punctuate the brash head of state's governance as it crawls to its fifth year next summer. Unable to secure affordable vaccine provisions for his disgruntled constituents despite new development aid/s from top benefactor United States last September, Duterte had to suffice, at least for now, with what China's state-owned Sinopharm could offer albeit more expensive that what the U.S./West's Pfizer, Moderna, AstraZeneca et al pegged.

            Of course, Mr Duterte faces a complex and complicated geopolitical chessboard, played with unnerving unpredictability by Washington and Beijing, which only weakens his leverage/s. But Filipinos don't have the patience to pore deeper on the whys and wherefores of the superpower mindgames. The leader's dismissive demeanor is it. Duterte's PR crisis overshoots his officework. good or bad.

 

The Philippines in a West-East tug of war

THE Philippines' economic growth slipped to 5.9 percent, pre-pandemic 2019, from 2016's 6.9 percent when Duterte assumed office. Although unemployment didn't really change during his time per se compared with his predecessor Noynoy Aquino's last year, at around 5 percent, the current president now faces an almost 9 percent joblessness as he grapples for ways how to work around Covid-19. New daily cases of coronavirus infections are still at 4-digits, 6-digits total. Duterte has to issue a fix right here and right now as his people takes a holiday religious breather.

            Apparently the Philippine President, a favorite trajectory target of global media demonization, needs help more than ever from the country's traditional bestfriend America and its "new" trade buddy, China. Although Japan consistently stays as the Philippines' #2 trade partner behind the U.S. and on top of China, Washington and Beijing are undisputedly the world's top economic movers. Even Tokyo has to navigate how the two powers issue maneuvers and gambits and variations on the board. Yet as ever, the Philippines asks itself: Where to and how's that?

            Duterte's decision to avail of China/Sinopharm's Covid-19 vaccine instead of what the U.S.-controlled Pfizer, Moderna, and three more pharma giants that pursued development of vaccines with Washington funding aid could eventually offer, only accentuates the dire fact that Duterte's back is up against a wall. America or China? For now, he has got to go Chinese, while America cools out of its long-drawn partisanship drama and finally into leadership transition. It doesn't really matter that Beijing's vaccine, reportedly at $145 for two dozes, is more expensive than Pfizer's $19.50/dose. The Philippines has to buy a cure and then resume business, hoping of course, that Sinopharm's cure works.

            So what's up in January 2021 as Joe Biden sits? Let's wait and see.

 

Washington romance: From dovish Trump to hawkish Biden

THE defeat of trade-dealing Donald Trump to the expectedly "military hard-power" pushing Joe Biden in Nov 3 would mean a bit of a shakedown in upcoming Manila/Washington bilateral talks. Although America's Democratic Party has gained majority seats in the House, the Senate would still be essentially Republican. Expect more virulent bipartisanship headbutts in the U.S. come 2021.

            Despite high-intensity polar extreme murk-throw in America, which makes its #1 "stature" as worst hit by Covid-19 "less urgent," when it comes to dealing with China's obvious expansionism, the U.S. is on-target. At least, in terms of rhetoric. Anti-China zeal is the thingy that both Left and Right agree with. Yet from Bill Clinton's (re)defining trade pact with Jiang Zemin in 2000, Washington hasn't really introduced a strategy that'd at least halt China's march. Meantime, true to the Central Committee's historical tact, Beijing doesn't really wait whatever Washington is up to next. Xi Jinping had it all figured out; Mr Biden's tactics and strategies are just formalities. China always has fallbacks for blowbacks whatsoever. The Dragon's wicked resilience is still impeccable.

            Meantime, the Philippines got to weigh in how all these would play up in 2021.

            Last September, Duterte and Trump's administration signed a new 5-year USAID development assistance worth $675 million or around Php32 billion. Between 2016 and 2019, the U.S. has provided $554 million in military aid to the Philippines, which didn't really produce any significant shudder. Thanks to Trump's largely dovish tact. Yet America's 4-year fling with relative pacifism seems over. Expect more money on "security"-related matters in and around South China Sea as Washington's War Lobby gains ground, Bidentime.

            The House has recently passed a new Defense bill worth $741 billion, all-time U.S. military budget high. As both Japan and South Korea sought reduction of U.S. troops in their shore prior to 2019, the Philippines is Washington's logical fallback. Sure, Manila kicked Clark air base and Subic naval base out in 1991, but really? Or was it about Mt Pinatubo's eruption + end of Cold War and not really the Philippine Congress nay ink? Five more U.S. military bases and installations stay, strategically placed in the archipelago. Time to review and upgrade?

            Sadly though, Washington's cash, pledged or forwarded, didn't help Duterte much as the Philippines fell in pandemic murk. The second-worst hit in Southeast Asia. Prior to the virus scourge, a "terror bill" floated around as a prep to the next coming of the hawk? With Trump gone, it appears like a no-brainer.

            Meantime, it can be recalled that China's pledge of investments and aid to Manila worth around $24 billion in 2018 hasn't been fully delivered. Reason why Duterte has been to/fro in his dealings with both Beijing and Washington, pre-pandemic. For example, Duterte had sad he would avoid joining military exercises with the United States in the sea that his government disputes with China. Yet the Philippine navy still participated in the multicountry Rim of the Pacific exercises that the U.S. government hosts every two years.

           

China carries on as the U.S. remains high on drama

TWO weeks after the U.S. presidential election on Nov 3, 15 Asia-Pacific nations converged in a new alliance called Regional Comprehensive Economic Partnership (RCEP). Led by China, the obvious post-Trump economic hookup in the East included powerhouses Japan, South Korea and Australia plus Singapore, New Zealand, Indonesia, Brunei, Cambodia, Laos, Malaysia, Myanmar, Thailand, Vietnam, and the Philippines.

            Designed to remove trade barriers, the region which holds 30 percent of global economy, should worry the incoming administration of Joe Biden, which is expected to (again!) go through massive bipartisan caterwaul and party infighting as liberals and progressives clash within Washington's hyperactive Democratic Party.

            Conspicuously absent at RCEP held on Nov 15 was India, which is currently the worst Covid-19 hit nation in Asia. Prime Minister Narendra Modi also faces tempest from the agriculture sector which employs more than 50 percent of the giant country's 400 million strong workforce. India is of course the United States' economic fallback in case Beijing stays overprotective of its fort. As per first phase of the new U.S./China trade pact signed on January this year, China is obliged to purchase U.S. products and services worth $200 billion in two years time. That'd mean the Chinese would buy American but that should be equalled by the U.S. cutting shipments of Beijing imports. Easier said than done.

            Meantime, the U.S. lowers tariffs on Chinese goods and maintain 25 percent duties on roughly $250 billion worth of stuff and things mainly by manufacturers to make finished products in America. The U.S. also keeps a 7.5 percent tariff on another $120 billion worth of mostly consumer goods like jackets, gloves, footwear and flat panel electronic displays — all rolled back from 15 percent. However, nearly 30 percent of U.S. goods exports to China are not covered by the phase one deal.

            Whatever the case, China is expected to abide by the Jan 2020 Trump/Xi trade pact. But true to its preparedness and resilience, the Central Committee already had, obviously, a post-Trump plan. The RCEP. What Beijing would probably "lose" in the 2020 trade agreement, it'd recoup via the new Asia Pacific trade partnership.

            Beijing's economic march didn't really shudder per Covid-19 pandemic. Fact is, China's pace-setting $4.6 trillion worth of trade is the global economic engine. The country's trade balance of $367 billion rules the roost, meaning its overall exports are higher than its imports. Hence the easing of barriers via RCEP deals means China will still be dominating manufacturing even though most of these would be partnerships with other nations, not just the 14 signatories to RCEP. Meanwhile this alliance is the game-changer so far.

            But whether this will change/alter the Philippines' middleground "game" between Washington and Beijing remains to be seen.

 

China on the driver's seat.

THE clear as sun picture is: China is the world's #1 economic mover even if the United States dictates how Made in China merch are marketed, priced, or sold.

            Trump worked in and around China's game on the chess table, putting more premium on trade move variations and tariff gambits over America's historical protocol of war intrigue and security/military brinkmanship or protectionist pressure-points as foreign policy leverage/s. Sure, Trump's deviation from the grid courted a 4-year vilification extravaganza from the other side of political/profit 1 Percent gods, which apparently lost mojo in business haggling and stuff. How's that? Think Amazon losing out to Flipkart/Walmart in India's e-commerce and Hunter Biden's natural gas push in re Moscow/Berlin by way of Kiev energy/natural gas battle in Ukraine on a standstill till dad sits.

            But all these don't really affect China or the East compared with the West, especially European Union, which hasn't really gotten off the debt crisis ushered by 2009 recession. For Beijing, it's business as usual. Its ambitious Belt and Road Initiative, designed to link regions via trade a-la 21st century Silk Road, is all set as Moscow gains in energy (oil and natural gas) global sales. Take note: Russia is #2 in oil exports and #1 in natural gas exports but the U.S., despite #1 ranking in oil production, is only #4 in both energy exports.

            So how does America at least halt China and Russia's ballroom dance? Both superpowers aren't Cold War-ring anymore; they are trading. On Bidentime, America and its European/NATO buddies will be back at a hawkish swagger, same policies that Joe's boss Barack Obama ineffectively waged for 8 years. Obama upped Defense budget to $721 billion in 2010 as recession crawled in the heartland.

            As most of the world a.k.a. West allies cringe in pandemic misery, border hostilities and civil strife rock nations NSEW of the globe. Enter Pentagon's new, astronomical military budget. Hence a Ramboesque foreign policy is back in Joe Biden era. Then we go to the Philippines, with its leadership painfully either confused or confusing since 2016. Should it go Chinese and abandon America, diss China and renew U.S. friendship of yore? Who knows. Yet President Duterte joining the RCEP joint accentuates the fact that Manila is torn between two lovers.

           

Washington military (re)strategy and Beijing's economic promise: Where to, Philippines?

ALTHOUGH the global writings on the wall say a clear message, it'd be hard to reject Washington's military restrategy to hopefully regain leverage on the trade table. America still controls the narrative hence the global perception. Yet militarism which was conveniently spun by "war of global terror" has lost considerable traction. Two major troublemakers out of the Gulf, ISIS' Abu Bakr al-Baghdadi and Iran's Quds' Qassen Soleimani were both taken out during Trump time.

            The signs that point to a world leaning towards the dove's olive branch over the hawk's claws seem no brainers: Russia has cut its Defense budget from #3 in the world to #9 last year to focus on economic diversification as augmented by the soon to be finished Nord Stream natural gas pipeline (to Western Europe). Oil-rich Middle East starts to sneer at "arms for oil" deals with the U.S. as the region heavily-diversifies from merely petroleum trade. Several handshakes between former Gulf enemies attest to the dictum war is bad for business.

            Meantime, as I noted below Japan and South Korea, #1 and #2 hosts of largest American troops overseas want lesser U.S. military presence in their midst. Australia and Singapore, both signatories to RCEP, could follow. Singapore already closed two Raytheon plants.

            As we entered a new millennia twenty years ago, relations between the Philippines and the United States also somehow wittingly or unwittingly waded in and around a tilt in geopolitical power play, anchored on China's advent as a global economic powerhouse. Following the gamechanging 2020 U.S./China trade pact, which paved the way for the Dragon's entry to the World Trade Organization as a favored new member, the Philippines, erstwhile top U.S. ally and security/military buffer in the East, got dragged into an entirely new superpower contest sans the destructive intrigue of Cold War.

            Yet despite media's fascination with pitting Washington vs Beijing as supposedly "warring" giants, the fact is they are not warring. They are actively dealing business. They are the world's top trade partners with export/import business amounting to $559 billion. The "trade war" was a kind of negotiation demeanor.

            So whether the Philippines concurs or not, or whoever it opts to kowtow with, however the ebb and tide of economic hawing between Washington and Beijing turns into, Manila simply allows itself to flow where the clime appears to blow. Which is how President Rodrigo Duterte seemed to play his cards. Or was he really playing on the table where his cards are either exposed or he has no high aces to play anymore. Or does he even know it? 

            Apparently, Duterte sought to please both benefactors. For now, he is with China per RCEP. But wait till Joe Biden finally sits in White House. Hence the Philippines remains in eerie theater of superpower tug of war. Torn between lovers or caught between a rock and a hard place. Such is the Philippines' chosen role, it seems. So it isn't really about the United States or China. It is about the Philippines. To simplify the analogy, in the context of Covid-19, what'd be the Philippines' choice of vaccine? Sinopharm or Pfizer? For now it's Sinopharm.

            This brings us to fundamental of human response. Should the Philippines stay this way? It is imperative that we look within and reexamine what we have lost, gambled away, or carelessly gave away. From ineptitude in governance to a fragmented population, from complacency in primal healthcare to lost in communal resilience, we need to go back to where we came in and restart. No revolution or election can change this institutionalized malady. The reexamination is individual and familial. Then communal/collective village-level as was the goal of government decentralization of Local Government Code. From there, we can go national. Regional and so on so forth. It would seem like going back to grade school.

            But that isn't really bad at all. Alvin Toffler wrote in 1969, as the world slides into computer technology that hinted of a global upheaval stronger than industrial revolution from agrarian paradigms: "The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn." 

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"The Chinese Roots of Italy’s Far-Right Rage." New York Times adds: "The country’s new politics are often attributed to anger over migrants. But the story begins decades ago, when China first targeted small textile towns." 

NY Times has evolved into a geopolitics tabloid. Intrigue pitcher, non pareil. China dominates the global economic roost so demonization of Beijing is a no brainer although I find it immature. Apparently, if ever, Italy's current "Far-Right" anti-immigrants anger is directed at a flawed asylum system vis a vis refugees from the Middle East and Sub-Saharan Africa, which I often link with border laxity of Schengen Area, yet media again points at the Chinese. Beijing doesn't muzzle in military brawn as trade leverage in favor of business/investments yet it is perennially sneered at.
The anti China narrative is loud yet historical facts and current events don't really support the smear campaign. Bilateral relations between China and Italy date back to Imperial China and Ancient Rome but ties only formally began in 1970. That was when Italy recognized the People's Republic of China over Taiwan. Other European countries such as Austria and Belgium followed. Since then, China and Italy participated in high-level political exchanges. In 2005, Defense ministers of both sides expressed hope for closer military cooperation which of course pissed NATO diehards, although Italy is also a member. And with Beijing and Taipei looming as major trade BFFs in the East, it's all good.

China and Italy. Then and now. Like other bilateral relations, Beijing and Rome weren't always awesome. We can trace trade friendship from long time ago's incessant flow of goods and information between travellers from the Roman Empire and Han Empire of China, as well as those from Eastern Roman Empire and various Chinese dynasties. Count Marco Polo's friendship with Kublai Khan when the khagan ruled Yuan Dynasty in 1200s. Cordial ties stayed to modern times. One of a number of huge partnerships was the Hongdu Aviation, one of China's major aircraft manufacturers, which was first established as Sino-Italian National Aircraft Works (SINAW) in 1934.
          The Republic of China and Kingdom of Italy joint venture Sino-Italian National Aircraft Works or SINAW is symbolic in a way. When the Second Sino-Japanese War broke out in 1937, Italy became an ally of Japan and assisted Japan in its bombing of SINAW factories. The Chinese government confiscated Italian properties in that year and all Italian employees of the company left by the end of the year. Probably this is what media calls as "Chinese roots of Italy’s Far-Right rage," which happened almost 83 years ago. Come on! Why I say that break in friendship has been healed? In March 24, 2019, Italy signed up to the Belt and Road Initiative, becoming the first G7 (or G8) nation to do so. Let's stay positive, okay? 

MORE: U.S. and China Trade Pact 2020.

NEWS (1). "Trump Gets His Trade Deal, China Gets the Win. China has suffered short-term pain from the trade war, but it stands to gain in the long term." Short-term pain? Nope. The Chinese never risked business without a strong safety net. While Trump busied himself a-front his foes homebased, Beijing upgraded its infrastructure in anticipation of influx of foreign/US investments when a trade pact is finally signed. Also, it firmed up economic agreements with Latin/South American giants Brazil, Argentina, and Bolivia--as well as in Sub-Saharan Africa. Then there's China's BRI gaining traction in eastern Europe via Ukraine. And of course China accelerated investments in Southeast Asia, as well. "Short-term pain," what? Beijing is still within its annual target of 6 to 6.5 GDP growth rate.

NEWS (2). "Trump Signs China Trade Deal, Putting Economic Conflict on Pause. An initial pact, cooling tensions in an election year, follows months of escalating tariffs and a trade war that seemed as if it would never end." What could be the best time to sign a trade pact? This: Two major humps in MidEast trade, al-Baghdadi and Soleimani, had been taken out. Tehran needs China to stay as its #1 trade partner; Chevron expands as border issues between Kuwait and SA were fixed; Saudi Arabia, Bahrain, UAE and Egypt shook hands with Qatar. War is bad for business. Aramco goes IPO. Fact: Global economic powers closely watch Washington's political drama due to obvious reasons. Sure, not just the Chinese. Consider oil-rich Arab sheikhs like the Saudis, Qataris and Emiratis. So there you go: Trade pact signed. 

Trade Pact 2020: United States and China.

NEWS: "China Trade Deal Details Protections for American Firms." News adds: "The agreement is expected to include significant concessions to protect U.S. technology and trade secrets, but its success hinges on whether China will follow through on its commitments." 

Copyrights are a central issue. Washington was aware of such a bottleneck when Bill Clinton signed a trade pact with Jiang Zemin nearly 20 years ago. The most integral issue is Beijing's overprotectiveness of its own internal business per se in re foreign traders coming in. Think British East India Company's Opium Wars or the Boxer Rebellion of many generations ago. I don't think China has really changed its Great Wall mindset despite its embrace of Western capitalism. 
         Beijing's iron-clad protection of homebased business, though leaning on the extreme, isn't really that bad. A government has to protect its own. Meantime, Bill Clinton's globalization oversight vis a vis 2000 trade pact left America's small and medium entrepreneurs (SMEs) reeling as China pumped up its manufacturing mojo. Beijing's massive production line a.k.a. working class was kept busy as job orders/deliveries incessantly packed shipments. When demands overflowed, China spread them out overseas via lands that the giant nation bought/rented as per its "Go Global" program that "soft-started" in the 1970s and went full gear following Beijing's WTO entry in 2001. All these, as China kept its countryside factories and plants strong.

          Protection of American firms homebased is a goal yet there is also the pressure of looking after US Forbes 400 within the Great Wall. The latter is the bottleneck: 1 Percent corporate gods who opted to ship jobs out. Would they care about a labor force that the new Left stereotype as nationalist/populist? Conservative voting bloc that they accuse of provoking Right-wing extremism? A media narrative that demonizes the working class as racist anti-immigrant church-going bigots? Meanwhile, what works in Beijing's socialist/Buddhist governance system doesn't necessarily apply as per America's political/cultural structure. For one, China controls its 4 state-owned banks; the US wades in and around the baton of 4 giant private banks.
         I don't think the new trade pact is about China than it is about the United States. Reason why Trump prolonged the hawing and haggling, which is basically the way he rolls his economic dice. Tariff gambits here and there. Bill Clinton saw a huge, largely untapped Chinese market in 2000 as export destination while probably not anticipating that the Chinese could actually turn the table upside down, not around, via low tax/tariff, cheap raw materials, low overhead etcetera to lure US corporations in. China had massive workforce. Aside from ample prep in lands bought in Argentina and Zimbabwe, for example, Beijing hooked up with surging Asian tigers/tiger economies, notably Taiwan and South Korea, to keep deliveries checked. 

          By the time the mighty lo mein dragon entered WTO in 2001, it had ample prep via its "Go Global" program that was silently scouring the peripheries while America was busy fortifying external Defense mojo. Meantime, 21st century pulled in. While US companies trooped out to savor globalization and a purist environmental tact pressured carbon footprinting plants out of the glade, America's small and medium traders reeled. By the time George W sat, 9/11 happened and so global war on terror was the Oval Office priority. Defense budget soared to $720+ billion all-time high. Bailouts came, which Obama carried on in his first term and then recession hit in 2008. Small business sunk some more and the working class suffered. Unemployment peaked at 10 percent in 2009. 
          As economic downturn growled, Obama unleashed stimulus package, initially estimated to be $787 billion, that essentially benefitted banks and giant corporations. All these as Beijing carried on spreading out loans and investments globally. That's where we are now: How do we restrain China from its massive Belt and Road Initiative? The hawks' push for military aid and security leverage which China doesn't buy at all? Good thing about Trump, compared with EU's collective administration post 2008 downturn, the US did recover but European Union is still mired at 0.2 percent GDP growth rate. So as two humps, al-Baghdadi and Soleimani, are taken out of the Strait of Hormuz bottleneck, let's see how these two superpowers work things out. Hence, I stay positive.