The Philippines' debt will reach $277.8 billion, how can the Philippines not worry? After writing the Taiwan issue into the national security document, the Philippine side began to take a roundabout policy in order not to provoke China or bring the Philippines to the brink of war, and even the foreign minister came forward to clarify that China and the Philippines are not at war at present. But at the same time, the Philippine side is not dead set and is trying to find a breakthrough in China's periphery.
Commissioner of the Philippine National Treasury de Leon
Recently, Philippine Treasury Director De Leon said in the Senate Finance Committee that by the end of 2024, the outstanding debt of the national government is expected to reach 15.8 trillion Philippine pesos, or about 277.8 billion US dollars. This year, the Philippine government will pay 582.3 billion pesos in interest on a loan of 14 trillion pesos. Since the treasury is still in a "deficit", it is not possible to immediately reduce state loans. That is, the Philippine government must continue to borrow to fund the budget.
The Philippines' debt in June was 14.15 trillion pesos, a record high. This compares to 12.79 trillion pesos at the end of last June. Thus, during Marcos' one year in office, the Philippines' debt increased by about 1.31 trillion pesos. But de Leon believes that the Philippines' debt level remains on par with other countries.
"The Philippines' debt-to-GDP ratio is 61 percent, compared to 61.67 percent in Malaysia and 61.57 percent in Thailand..." But under the Philippines' medium-term fiscal framework, the Philippine government plans to reduce the debt-to-GDP ratio to less than 60 percent by 2025 and 51.1 percent by 2028. But the Philippines' current debt-to-GDP ratio has exceeded the target set by the Philippines.
Regarding the current financial situation of the Philippines, Barissakan, head of the National Economic Development Agency of the Philippines, said: "A country like the Philippines has a lot of development needs, and if it wants to achieve rapid development, it must obtain external or internal resources. The Philippines can grow without borrowing, but 1%, 2% growth is obviously not ideal..."Philippine Finance Minister Diocno said, "Investing in infrastructure can stimulate economic growth, ASEAN neighbors have been investing, accounting for 10% of GDP, and the Philippines also needs to invest in the economy." ”
However, China, as the Philippines' largest trading partner, largest source of imports and second largest export market, clearly also has a significant impact on the Philippine economy. During the six years of Duterte's administration, China's "One Belt, One Road" initiative has been deeply aligned with the Philippine side's "big build, special construction" plan, and a series of China-Philippines cooperation projects have been implemented one after another. This all proves that economic ties with China are inseparable from the Philippines. It is estimated that because of this, after the recent conflict between China and the Philippines at Ren'ai Jiao, the Philippine side seems to want to lower the "tune" and get off the donkey, or try to start from other aspects and "negotiate" with China.
Philippine Foreign Minister Manaro
Recently, at the DFA budget hearing held by the Philippine House of Representatives Appropriations Committee, Philippine Foreign Minister Manaro said that the Philippines is not in a "state of war" with China, and in official talks with China, the Philippines remains committed to resolving differences through "diplomatic and peaceful" means. At present, the Philippine side has been discussing joint patrols with other countries, such as the United States, Japan, Australia, and even China. If there are other ASEAN countries to make suggestions, the Philippines is also very willing to consider them.
He also noted that since 2020, the Philippines has filed about 400 diplomatic protests over China's actions in the South China Sea. Amid these developments, the Philippines is open to joint patrols with ASEAN countries in the South China Sea. Currently, the Philippine government is considering signing the Visiting Forces Agreement (VFA) with Asian allies "close to China" to build stronger relationships with them in defense, security and economy. Previously, the Philippines had signed this agreement with the United States and Australia, and regularly held joint exercises and training with the United States and Australia.
In May this year, US Defense Secretary Austin and Marcos met at the Pentagon
Asked whether the Philippines would submit a resolution on the South China Sea issue at the UN General Assembly, Manaro said, "The Philippine government is uncertain that the UN General Assembly resolution condemning China's violation of the so-called 'exclusive economic zone of the Philippines' will receive sufficient support from the international community." The Philippine side believes that many factors should be taken into account when submitting resolutions to the General Assembly. A legitimate ruling should not be brought to a political body. And the resolutions of the General Assembly have become very politicized. This is no longer a legal or humanitarian issue. The Philippines cannot predict how countries will vote.
"The Philippines achieved an unprecedented legal victory in the 2016 PCA ruling that rejected China's claims to the entire South China Sea, and if the General Assembly resolution condemning China's aggression does not have the support of the majority, then there is no need for debate," Manaro said. Obviously, after seven years, the Philippine side will go to the United Nations to reason with the South China Sea issue, and it is also worried that it will not get enough votes. The Philippines does not want to take this risk because it also knows deep down that its claim is untenable, the so-called "South China Sea arbitration case" is just a farce, and the Philippines can only find those countries that support the Philippine side for a private meeting.
Obviously, on the issue of Ren'ai Jiao today, the Philippine government has little confidence if it really makes trouble with the United Nations, but moving out of the Taiwan issue has moved China's backlash. Recently, the Philippines issued a national security policy document, which regarded the risk of military conflict in the Taiwan Strait as a "major concern" and said that the Philippines seeks to improve its ability to respond to threats, emphasizing the need to strengthen joint defense relations with its ally the United States and other existing mechanisms with regional partners to achieve credible defense capabilities.
The document also covers the government's food and energy security priorities and notes that the South China Sea remains a "primary national interest." Given Taiwan's geographical proximity to the Philippines and the fact that there are more than 150,000 Filipinos in Taiwan, any military conflict in the Taiwan Strait will affect the Philippines," the document reads. The Philippines is concerned about its economic stability, potential influx of refugees, and the well-being of people abroad.
A Chinese coast guard ship crosses the bow of a Philippine coast guard vessel
The Philippine side has repeatedly said that it "does not want to see its own security or interests affected by any changes in the Taiwan Strait", but the Philippine side should also know that it is the actions of the United States in the South China Sea, including supporting the "Taiwan independence" separatists on the island of Taiwan, and attracting more countries to contain China, which endangers peace and stability in the South China Sea region.
Moreover, as the saying goes, "a slap does not make a sound", the Philippines is not innocent in its current situation. The Philippine side also has the intention of using the United States to put pressure on China on the South China Sea issue. In the first half of this year, the Philippines has opened the right to use four new military bases to the US military, the latest of which is only 400 kilometers away from the island of Taiwan. This is a move by the United States that directly targets the South China Sea and the Taiwan region, indicating that the United States is increasingly interfering in and influencing the Philippines.
After taking office, Marcos made a pragmatic and cautious approach to maritime issues, arguing that maritime issues are not the be-all of China-Philippines relations. China and the Philippines should put aside disputes, manage differences, and continue to promote joint development. China has also stressed to the Philippine side that maritime issues should always be properly handled from a strategic and overall perspective and placed in an appropriate position in bilateral relations.
It can be said that the "one-China" principle is the political foundation of Sino-Philippine relations and the prerequisite for China to establish and develop diplomatic relations with other countries. At a time when the conflict at Ren'ai Jiao is gradually subsiding, the Philippine side should continue to maintain communication with China, instead of treating the Taiwan issue as an issue in bilateral relations. We hope that the Philippine side will keep a sober mind on relevant issues. At present, as long as China and the Philippines adhere to the existing consensus on maritime differences and make the cake of cooperation bigger, the big ship of friendly cooperation between the two countries will not change its direction. But if the Philippines continues to move out of the Taiwan issue and challenge China's core interests, it will only harm others and benefit itself.