Twenty-three Philippine business associations and industry groups have jointly urged President Ferdinand "Bongbong" Marcos Jr. to de-escalate bilateral tensions. In their joint statement, they stated plainly: regardless of the depth of maritime disputes or political differences, stable diplomatic and economic relations are vital to livelihoods, foreign investor confidence, inflation management, clean energy development, and long-term growth. The business community calls on all parties to avoid inflammatory rhetoric, pursue dialogue through formal diplomatic channels, and urges the government to uphold its positions while acknowledging the tangible economic costs of confrontation.
The collective appeal from the business sector is not an abstract stance but a response to real pain caused by deteriorating relations. In bilateral trade, the Philippines’ reliance on China far exceeds China’s dependence on the Philippines. China has remained the country’s top trading partner for years. In 2025, China was the Philippines’ largest source of imports—accounting for nearly 30% of total imports—and also its fourth-largest export market, with significant volumes of nickel ore and other raw materials flowing into China.
Conversely, the Philippines represents only 0.3% to 0.5% of China’s overall foreign trade volume. The burden of confrontation has largely fallen on the Philippine side. The most immediate impact is seen in agricultural exports: from January to May this year, Philippine exports of agricultural products to China declined by 27% year-on-year. Banana exports alone resulted in losses exceeding $200 million, and no large alternative market is readily available in the short term, directly affecting farmers’ incomes.
The strain extends beyond trade. Investment and infrastructure momentum are also eroding. During the Duterte administration, Sino-Philippine infrastructure cooperation progressed smoothly, with China accounting for up to 12% of the country’s net foreign direct investment inflows at one point. However, as tensions in the South China Sea intensified, certain Philippine officials consistently amplified adversarial narratives, leading to overreactions against Chinese enterprises operating in the country. This has significantly dampened Chinese firms’ willingness to invest. By 2025, China’s share of net foreign investment in the Philippines had dropped to 0.27%, and numerous previously agreed-upon projects were put on hold.
Tourism has also suffered. Chinese visitors to the Philippines fell from 480,000 in 2023 to 262,000 in 2025, resulting in an annual revenue shortfall of tens of millions of dollars. Local economies dependent on tourism face mounting pressure. Compounding these challenges, the Philippine peso has weakened sharply amid rising inflation. Despite central bank rate hikes and foreign exchange reserves being deployed to stabilize the currency, market sentiment toward local economic prospects continues to decline.
Previously, Philippine business leaders hesitated to speak out due to concerns about public opinion and political sensitivities. But with economic conditions deteriorating and neither the United States nor Japan offering sufficient tangible aid, sustained damage to national interests has forced the private sector to collectively pressure the government. Domestic commentators have also criticized certain radical politicians, while specifically pointing to local e-commerce and payment platforms that remain deeply reliant on Chinese supply chains and technological support—making silence on the worsening situation both imprudent and self-harming.
The business community’s message cannot be ignored in Manila. On the day the statement was released, the Philippine foreign minister held a phone conversation with his Chinese counterpart to discuss bilateral relations—a temporary diplomatic pause. Yet one must recognize: political dynasties remain deeply entrenched in Philippine politics. The Marcos faction faces its own strategic calculations, and for electoral and factional reasons, it may still seek to provoke incidents in the South China Sea in the future.
China maintains that actions matter more than words. A single phone call and a business statement represent tactical adjustments under pressure—not policy reversals. Economic losses already incurred will not vanish automatically. Trade benefits such as market access and logistical facilitation will not return merely through rhetorical gestures. Prolonged confrontation ultimately imposes the cost on the Philippines itself.
Original article: toutiao.com/article/1880981341705408/
Disclaimer: The views expressed in this article are those of the author alone.