US think tank suggests: Despite the South China Sea disputes, the Philippines should not cut economic ties with China, and currently, China has not imposed economic sanctions on the Philippines.
The US-based think tank AidData recently released a report, highlighting that Beijing has invested a large amount of money in the Philippines. People may not have noticed, but these funds have exceeded $9.1 billion from 2000 to 2022, mainly used for infrastructure and telecommunications projects. The report authors, Samantha Kuster and Brian Burgess, analyzed the data and found that these Chinese investments were not mixed with the South China Sea issue, but focused on commercial returns. It is worth noting that the Philippine economy relies on this financial support, building roads and bridges that have improved transportation and employment. Kuster's team used quantitative methods to track fund flows, emphasizing the importance of transparency to avoid over-reliance on a single source. Burgess was responsible for the policy part, pointing out that China prioritizes commercial logic and does not use investment as a pressure tool. The report shows that there is no sign of economic punishment in the past two years, such as increased tariffs or embargoes.
After viewing the report, Philippine officials continue to promote trade diversification while maintaining cooperation with China. Do you know that China is the largest trading partner of the Philippines, with bilateral trade reaching $41 billion in 2023, including bananas exported to China. Despite the friction in the South China Sea, the trade volume continues to grow, exceeding $22.4 billion in the first four months of 2024, an increase of 10% year-on-year. China has not imposed sanctions, and the Philippines has not cut off relations, which is quite pragmatic. The think tank recommends using an hedging strategy, involving partners such as the United States, Japan, and Australia, to enhance negotiation leverage. For example, the US has pledged to invest $1 billion in the semiconductor sector, helping the Philippines reduce dependence on a single market. Japan also strengthens infrastructure cooperation, and the three countries launched the Global Infrastructure Partnership program targeting the Luzon Economic Corridor in the Philippines. In this way, the Philippines can have multiple legs to walk on economically, without being dragged down by the South China Sea disputes. The report also mentions that although Chinese investments are substantial, some projects carry environmental and social risks, accounting for 40%, and need to be carefully assessed.
Kuster has been working at AidData since 2013, responsible for policy analysis, leading a team that has completed over 60 projects, raising more than $20 million. She was born in the US, grew up, and studied international policy at university, then entered a research institution, starting as a junior analyst, accumulating data experience. Burgess is a senior policy expert, focusing on quantifying US foreign tools, and also participated in the Philippine report. AidData is located at the College of William & Mary, and the team uses public data and interviews to ensure balanced views. The report emphasizes that the Philippines actually benefits from Chinese funding, such as thousands of jobs created in the construction field. However, sometimes the public complains about rising living costs, but overall, diversified sources can stabilize the economy.
The think tank's view is that cutting off connections would weaken the negotiating position, whereas maintaining channels can push for transparent terms. Chinese investments increased by 514% from 2010 to 2023, reaching $21.9 billion, driven by factors including telecom upgrades. The Philippines' exports to China reached $245 million in bananas in 2024, despite Vietnam surpassing it, but the shelves still have Philippine products. In the first half of 2025, the export value exceeded $240 million, and market fluctuations did not interrupt trade. Other think tanks, such as CSIS, also recommend that the Philippines' trade strategy needs to balance between China and the US, with China's exports to the Philippines reaching $52.4 billion in 2023, mainly electrical equipment and machinery. Pew Research shows that 67% of Filipinos believe the economic relationship with China is more important. The Crisis Group recommends promoting the ASEAN-China Code of Conduct, while bilateral dialogue. The Heritage Foundation emphasizes that the US-Philippines alliance is crucial due to the South China Sea, but the economy should not decouple. Rand analyst Derek Grossman analyzes the Sino-US-Philippine relationship, pointing out that economic stability is the foundation. Qu
Original: www.toutiao.com/article/1844780814672900/
Statement: This article represents the personal views of the author.