In the South China Sea dispute, the Philippines is testing the bold hand of Beijing By Reuters

(Corrects the name of the institution in section 10)

By Karen Lema, Greg Torode

MANILA/HONG KONG (Reuters) – Crammed into the presidential status room last February, the Philippines’ top officials faced a tough choice.

Military and intelligence leaders watched as coast guard officials showed images of what the agency said was a military-grade laser that China had pointed at a Philippine ship in disputed waters days earlier.

Eduardo Ano, national security adviser and chairman of the South China Sea task force, had to decide whether to release the images and risk Beijing’s anger, or stop angering its biggest neighbor.

“The public should know,” the retired general told officials. “Publish the pictures.”

The previously undisclosed meeting marked an important moment, as Manila began a publicity campaign to highlight the territorial dispute in the South China Sea, where shipwrecks, use of water rivals and protests by officials have fueled tensions.

“It was a turning point and the birth of a policy of transparency,” National Security Council spokesman Jonathan Malaya, who attended the meeting and recounted the exchange, told Reuters. “The aim was to save at great cost the reputation, the image and the standing of Beijing.”

Malaya said President Ferdinand Marcos Jr ordered officials to “develop and internationalize” the conflict, which he achieved by using the coast guard and embedding foreign journalists in operations. “This has been an important part of building international support for the Philippines, because our audience is foreign governments,” he added.

This account of the Philippines’ policy shift and its implications is based on interviews with 20 Philippine and Chinese officials, regional politicians and analysts. They said the publicity over China’s actions, combined with Manila’s deepening military ties with the US, had curbed Beijing’s ability to escalate matters at sea but raised the risk of China’s economic retaliation and US involvement.

The February 2023 meeting came days after Marcos granted the US access to four more military bases in the Philippines, reviving defense ties that had weakened under his predecessor, Rodrigo Duterte.

“China has increasingly few options left other than creating a US-Philippines defense pact and risking a war between the Chinese and American militaries,” said Ian Storey, a security expert at Singapore’s ISEAS Yusof Ishak Institute.

Marcos also pursued a political offensive, receiving statements of support for the Philippines’ position from countries such as Canada, Germany, India and Japan.

The South China Sea is rich in oil and gas. About $3 trillion in trade passes through it every year. US access to Philippine bases could prove crucial in the war over Taiwan.

China, whose claims to much of the sea were rejected by an international court in 2016, says Philippine ships are illegally entering the waters surrounding the disputed holes. It warned Marcos, who assumed office in June 2022, not to misjudge the situation.

“This is luxury, poker,” said Philippine jurist Jay Batongbacal. “Brinkmanship is putting things on the edge, trying to see who loses. Poker is a game of trickery and deception – one can do both at the same time.”

In response to questions from Reuters, China’s Foreign Ministry said the Philippines was stoking tensions with “provocative actions at sea in an attempt to violate China’s territorial sovereignty and maritime rights”.

China, said it will protect its interests while handling the dispute peacefully through negotiations.

A spokesperson for the US State Department said that Manila’s transparency program has succeeded in drawing attention to China’s “disregard for international law” and actions that endanger Philippine service members.

The spokesman did not comment on the risk of US military involvement but said the US will support the Philippines if it faces economic coercion from China.

‘WAKE UP IN THE NIGHT’

The dispute centers on Scarborough Shoal and Second Thomas Shoal, where the Philippine navy maintains a rusted warship, the BRP (NASDAQ: ) Sierra Madre, which came ashore in 1999 to bolster Manila’s sovereignty claims. A small group is standing on it.

Chinese ships have sought to block re-exports, circling Philippine vessels and firing water cannons that in March smashed a boat’s windshield, injuring its crew. Manila released photos of the incident; China said it was acting legally and professionally.

In February, Philippine ships filmed their Chinese counterparts placing a barrier at the entrance to Scarborough Shoal. This week, the two sides traded accusations of their ships colliding near Second Thomas Shoal.

Philippine Coast Guard spokesman Jay Tarriela taunts Chinese officials and state media about X, at one point posting drone footage of the collision at sea. “If I was doing something wrong, I would be banned,” he said.

Tarriela said the transparency campaign has worked, by encouraging support for Manila while the violence in China has not changed, although the incidents have increased.

“They still depend on their water… they still stick to that strategy,” he said.

The number of Chinese ships around the Second Thomas Shoal during the Philippine redeployment has grown from an average of one ship in 2021 to about 14 in 2023, the Center for Strategic and International Studies said in January.

Last month, China’s coast guard came within meters of the Sierra Madre and seized supplies airdropped from troops stationed there, according to Philippine officials. China, whose navy was patrolling nearby, said Philippine soldiers pointed guns at the coast guard; Manila said they just grabbed their weapons.

Philippine officials say they fear the deadly incident could escalate into open war.

“That keeps many of us awake at night,” the Philippines’ ambassador to Washington, Jose Manuel Romualdez, told Reuters.

Manila also wants to avoid the kind of economic pressure it faced a decade ago, when China’s protracted customs inspections caused Philippine bananas to rot in Chinese ports.

China was the Philippines’ second largest export market in 2023, accounting for nearly $11 billion or 14.8% of its total exports. China is the Philippines’ leading source of imports, especially refined petroleum products and electronics.

Romualdez said Manila hopes that China “will see the importance of continuing our economic work while trying to resolve this issue peacefully”.

Edcel John Ibarra, a political scientist at the University of the Philippines, said Marcos risks China taking a “hard path”, such as non-tariff barriers and travel restrictions. He cited reforms announced by China in May that allow the coast guard to detain immigrants without charge for 60 days.

‘PARADIGM SHIFT’

The intensity of Manila’s campaign surprised its neighbors. Vietnam and Malaysia, which also have maritime disputes with Beijing, are very careful about what they release in their wars with China.

“We’re all watching this and talking to each other,” said one Asian diplomat, who spoke on condition of anonymity. “The Philippines has come up with a new strategy to resist Beijing during the conflict.”

Marcos said in December that talks with China had achieved little, asking Southeast Asia “to come up with a paradigm shift”.

Chinese media have expressed outrage at the push for transparency.

The Philippines has been “playing the victim to manipulate the opinion of the international community,” the government-backed Global Times said in an op-ed in May.

A key element of Manila’s approach was strengthening the US alliance. Both countries made it clear in May last year that their defense agreement includes the coast guard. In April, Marcos participated in an unprecedented summit with his US and Japanese counterparts.

A US official who took part in US-China talks that month said Chinese officials complained about the diplomatic success behind closed doors, adding that Beijing “felt oppressive”.

Some Chinese scholars, such as Zha Daojiong, at Peking University’s School of International Studies, say the situation is complicated and that China will continue to “continue to work” in areas like the Second Thomas Shoal.

“In response to the action of the Philippines, I think they want to keep the message that this incident is controversial,” he said.