Philippine President Duterte's China pivot hasn't reduced tensions in the South China Sea

• Philippine President Rodrigo Duterte's Beijing-friendly postures have not tamed China's assertiveness in the South China Sea, said Peaches Lauren Vergara of Amador Research Services.
• The next Philippine leader, who will be elected in May 2022, should be bolder in challenging Beijing, Vergara wrote in a report published by the Asia Society Policy Institute.
• The Philippines cannot resolve the South China Sea dispute on its own, said think thank International Crisis Group.
• The country should push for a "code of conduct" between Southeast Asian countries and China to manage maritime tensions, the think tank said.

More than five years on, Philippine President Rodrigo Duterte's Beijing-friendly postures have not tamed China's assertiveness in the disputed South China Sea — and the next Philippine leader should be bolder in challenging Beijing, said a political and risk analyst.

The Philippines will hold general elections to vote for a new president in May as Duterte's six-year term comes to an end. Duterte has sought closer ties with Beijing and declared that he was willing to set aside his country's territorial contest with China in the South China Sea.  

China and its Southeast Asian neighbors including the Philippines have been embroiled in territorial disputes in the South China Sea for decades.

China claims almost the entire waterway. In the last few years, China built artificial islands in the sea, while Chinese fishing fleets and maritime militia vessels swarmed areas internationally recognized as belonging to other countries.    

"The most favorable scenario for the Philippines would be a change in the mindset of the elected leader in May 2022," said Peaches Lauren Vergara, head of the strategic intelligence practice at Amador Research Services, a research and advisory firm.

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The next Philippine president should steer away from "the defeatist attitude displayed by the current leadership," and more firmly challenge China's claims, Vergara wrote in a December report published by the Asia Society Policy Institute.

CNBC has reached out to the Philippines' Department of Foreign Affairs, as well as the Chinese embassies in Singapore and the Philippines, for comment on the report. None have replied at the time of publication.

Tensions with China

The Philippines was handed a victory in 2016 when an international tribunal in the Hague dismissed China's claims in the South China Sea, which contains the world's busiest shipping lanes. The judges ruled that specific portion of the sea claimed by both countries belonged to the Philippines alone.

China rejected the ruling. Duterte downplayed the ruling in hopes of gaining economic concessions from Beijing and said the Philippines is no match against China in a confrontation.

With just months left in Duterte's presidential term, China's promised infrastructure investments to the Philippines have fallen short of expectations, while tensions between Manila and Beijing are rising again in the South China Sea, according to a December report by think tank International Crisis Group.

"Many in the Philippines are increasingly sceptical of rapprochement with China if it entails giving up claims to various disputed maritime features," read the report.

The South China Sea, a resource-rich waterway, contributes around 27% of the Philippines' total fisheries production, said Vergara in the Asia Society Policy Institute report. A group of scientists have reportedly warned that Chinese activities in the disputed waters threaten the fishing industry.

Meanwhile, tensions with China have hindered Philippine oil exploration efforts in the sea.

"This has serious repercussions for the country's ability to achieve energy security as its main source of natural gas for electricity supply — Malampaya — nears depletion," Vergara said.

Some in the Duterte government have more vocally protested the presence of Chinese vessels in parts of the South China Sea that were internationally recognized as belonging to the Philippines.

In May, Foreign Affairs Secretary Teodoro Locsin Jr. directed an unusually aggressive tweet at Beijing as the two countries clashed over the South China Sea. Locsin Jr. accused China of straining its "friendship" with the Philippines.   

Philippine presidential race

China's growing assertiveness and Duterte's "subservience" to Beijing have propelled issues surrounding the South China Sea into the public limelight in the Philippines, said Vergara.

Some analysts said Philippine presidential candidates that appear pro-China could face opposition from the public.  

Ferdinand "Bongbong" Marcos Jr. — son and namesake of late dictator Ferdinand Marcos — led the latest opinion poll on the presidential race. In a December survey by independent pollster Pulse Asia, 53% of respondents picked Marcos Jr. as their favored presidential candidate.

Compared with Duterte, Marcos Jr. would seek "more balanced ties" with the U.S. and China if he's elected, said Peter Mumford, practice head for South and Southeast Asia at risk consultancy Eurasia Group, in a report last month.

Navigating U.S.-China competition

The South China Sea is one of the contentious issues in the geopolitical competition between the U.S. and China. The administration of U.S. President Joe Biden has called out China's "unlawful" claims and "bullying" in the sea.

The Philippines is in a challenging position in that contest. The Southeast Asian country has a defense treaty with the U.S., while China is its largest neighbor and top economic partner.

"A crucial question remains whether the Philippines can navigate between China and the U.S. without an armed confrontation compelling it to choose sides," said the International Crisis Group.

"For now, Manila is hedging well. But its balancing act may soon become untenable as Beijing seeks to assert its regional ambitions and Washington pushes back," it added.

The think tank said the Philippines cannot resolve the South China Sea dispute on its own. The country should work with its neighbors on issues of common concern, such as fisheries management and law enforcement, to manage their territorial disputes.  

The Philippines should also push to finalize a "code of conduct" between Southeast Asian countries and China to manage maritime tensions, while keeping a diplomatic channel with Beijing open to reduce misunderstandings, said the International Crisis Group.

"None of these steps will resolve the increasingly entrenched maritime dispute, but they could help keep the risk low that incidents at sea will escalate toward conflict."

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