KEY TAKEAWAYS
KEY TAKEAWAYS
China and the Philippines this weekend reached a deal aimed at reducing their growing tensions over Second Thomas Shoal. The agreement comes as maritime confrontations have been increasing in frequency and intensity, raising fears of a broader conflict that could lead to the Philippines invoking its mutual defense treaty with the United States. While the deal could be a key step to reducing tensions, messaging from both Beijing and Manila suggests that both sides still firmly maintain their positions on the disputed waters, and that they see the agreement’s provisions in fundamentally different ways.
USIP’s China and Philippines experts discuss why the two sides reached this agreement now, what it could mean for tensions in disputed waters and how the U.S. should see these developments.
Scobell and Spinelli: Of all China’s land and maritime disputes with neighboring states, in recent months the most contentious and escalatory has been the decades-long dispute with the Philippines over Second Thomas Shoal (which the Philippines calls Ayungin Shoal). The Philippines conducts regular resupply missions to the shoal that supports the Sierra Madre, a Philippine navy ship that Manila deliberately beached on the island in 1999. Chinese and Filipino sailors regularly accuse the other of obstructing the waterways near the island, with increasingly aggressive Chinese tactics reaching new heights in a June 17 incident in which a Filipino sailor lost a finger after being rammed by a Chinese ship — although China’s Coast Guard laid the blame on the Philippines.
While both Beijing and Manila concur that the two governments reached an agreement this month to allow the Philippines to resupply the crew of the Sierra Madre without Chinese interference, the two sides are unable to agree about the specific contents and no text of the agreement has been publicly released. This ambiguity was highlighted by dueling statements issued after the agreement was announced.
On July 22, China’s Ministry of Foreign Affairs (MFA) proclaimed that three principles undergird the bilateral agreement: (1) China still believes the Philippines ought to eventually withdraw from the reef and restore it to its original state; (2) China will allow the Philippines to resupply the Sierra Madre after receiving advance notification and conducting on-site verification; and (3) China will “resolutely block” any Philippine attempt to build permanent fixtures. China says its “temporary” agreement with the Philippines is in line with these principles and allows for the “transportation of humanitarian supplies,” though China insists it will “monitor the entire process.”
A Philippine public statement did affirm that neither Manila nor Beijing had backed away from its territorial claims and their agreement would “not prejudice each other’s positions in the South China Sea.” But Manila flatly denied China’s claim the deal stipulated that the Philippines would give advance notice before pursuing future resupply missions. Instead, the Philippines insists that the two governments had “reached an understanding of principles and approaches that will be observed by both sides in order to avoid misunderstanding and miscalculation.”
While a bilateral negotiation on Second Thomas Shoal would normally be considered a positive development, the current situation prompts a reaction of surreal confusion. Without the text of the agreement available, it remains difficult to assess what precisely the two sides agreed upon and how the two parties can move forward constructively. Perhaps the only detail that the two sides seem to accept is that this is an interim deal.
This acrimonious outcome and apparent absence of any tangible agreement prompt two questions. First, why did China pursue this agreement in the first place? Second, why didn’t Beijing abandon the initiative and avoid this chaotic, confusing and potentially embarrassing conclusion? The answer to the former is that Chinese diplomats likely believed that they had a rare window of opportunity to reach an agreement that could succeed in de-escalating a volatile situation. The answer to the latter is much more difficult to discern but the simplest explanation is that Beijing’s diplomats mistakenly but sincerely believed they had attained success.
Harding: From the Philippines' perspective, the agreement is a win and it did not concede anything. The Philippines will remain able to resupply its forces on the Sierra Madre, just as it has since its grounding in 1999, except without the levels of Chinese harassment seen in recent months. The Philippines will see this episode as validation of its proactive approach to defending its claims to the West Philippine Sea since President Ferdinand Marcos Jr. took office in 2022, which has been centered on: (1) an assertive public messaging effort to put China on the back foot and to show the world the extent of China’s behavior in its exclusive economic zone (EEZ); (2) deepening its military alliance with the United States to put teeth in the Mutual Defense Treaty; and (3) strengthening partnerships with a wide array of additional international partners such as Australia, Japan, India and Canada.
From the Philippines' perspective, the agreement is a win and it did not concede anything.
More broadly in Southeast Asia, the agreement will be warmly welcomed. While the Philippines approach under President Ferdinand Marcos Jr. has generally — and quietly — been supported by the Philippines’ Southeast Asian neighbors, prior to the agreement there were also mounting concerns that the situation around Ayungin Shoal could escalate out of control. There were also concerns that the Philippines and China were no longer talking; the intensive negotiations that led to the breakthrough should reduce those fears. The Philippines will also no doubt hope that other South China Sea claimants will take a page from its playbook and see the strategic value of publicly highlighting China’s aggressive behavior.
Freeman and Tsering: The agreement provides some much-needed breathing room between the two countries but does not appear to signal anything more durable. It follows the announcement that a leader-level hot line will be established between Chinese leader Xi Jinping and Marcos, which reports suggest is part of a set of channels and confidence-building activities to prevent further escalation of South China Sea conflicts.
Both the new hot line and agreement on Philippines’ resupply missions reflect a recognition by China that the escalation risks are very real. Moreover, China has suffered reputational damage from its confrontational actions, which have resulted in reported injuries to Philippines personnel.
The agreement may serve to de-escalate tensions, but Chinese forces will remain a looming presence and, although Manila has denied agreeing to either prior notification or on-site verification, Beijing may assert these “terms” to further justify intervention in resupply activities.
For China, which operates in a top-down system of crisis communications and management, the new leader-level hotline could imply intent to seek actual de-escalation and institutionalize a system of crisis prevention. However, whether this hotline is actually used or languishes like earlier established hotlines between the two countries remains to be seen. This agreement will only improve regional security if, along with demonstrating commitment to the terms of the agreement, Beijing picks up the phone if Marcos gives Xi a call.
Whether this hotline is actually used or languishes like earlier established hotlines between the two countries remains to be seen.
Given that China’s foreign ministry released a statement that included no provisions for whether China would escalate failures to proactively communicate passage, the agreement still seems far away from resolving the primary points of current contention.
Harding: The devil will be in the execution, as an exchange between foreign affairs spokespersons following the agreement has already made clear. Specifically, will there be “prior notification” and “on site verification,” as described by the Chinese, and what would that look like? Ayungin Shoal is also far from the only disputed feature within the Philippines EEZ, with China’s control over Scarborough Shoal since 2012 particularly vexing for the Philippines. We can expect the Philippines to continue to highlight Chinese actions around Scarborough Shoal and build on what it will have seen as success if its perspective on the agreement holds.
More broadly, China is engaged in extensive influence operations throughout the Philippines, an effort brought to life in recent weeks with the disappearance of Alice Guo, a Chinese citizen and alleged spy with transnational criminal links who was mayor of a town in the Philippines. Highlighting these activities will also no doubt be an increasingly high priority for the Government of the Philippines.
Cheng: For the U.S., the key is to not be mesmerized by the fact there is an agreement. China has not given up its claims, and indeed, is now posturing to assume the high ground, accusing the Philippines of making concessions and now reneging.
If the United States intends to deter Chinese aggression in the area, it needs to demonstrate that it is a reliable and steadfast ally. The Philippines is an important test case, as it is a treaty partner, under the U.S.-Philippines Mutual Defense Treaty of 1951.
The United States has long held that the defense treaty does not extend to the disputed waters and features in the South China Sea. The treaty can be invoked, however, if there is an “armed attack in the Pacific area on either” country, where an armed attack is defined as attacks on the metropolitan territory of either state, “or on its armed forces, public vessels or aircraft in the Pacific.” Thus, President Biden’s national security advisor, Jake Sullivan, has stated that the treaty extends to the Philippine landing ship.
Sullivan’s warning to Beijing that the U.S. “will do what is necessary” to support Philippine resupply efforts is a good first step, but an empty gesture unless backed by the ability to support it. Other U.S. allies are looking to see how the Washington responds.
The United States cannot afford to allow Beijing to make the South China Sea, through which trillions of dollars’ worth of global trade passes, into Chinese territorial waters.
The reality is that this is not about a rusting World War II-era landing ship and some 50 Philippine marines. The United States cannot afford to allow Beijing to make the South China Sea, through which trillions of dollars’ worth of global trade passes, into Chinese territorial waters. Deterring China in this case requires a willingness to risk conflict, in order to maintain the peace. Beijing has repeatedly demonstrated that it is willing to risk conflict, as its ships and aircraft have maneuvered dangerously around U.S., Australian, and Canadian ships and aircraft, and Chinese sailors and maritime militia have sought to intercept Philippine supply efforts. Without a corresponding willingness to demonstrate to the Chinese leadership that the West is prepared to accept higher risk in order to back its ally and honor its treaty commitments, American leaders are likely to be seen as bluffing, eroding regional confidence in Washington.
Backing Sullivan’s words with sufficient force to ensure that the garrison is resupplied, and neutralizing Chinese interference, would put the onus on Beijing on further escalation. Compelling Beijing to consider its risk calculus, and whether the outpost is worth risking conflict, is essential if further Chinese aggression in the region is to be avoided.
Dan Spinelli is a program specialist for the China program at the U.S. Institute of Peace.