Business World

Duterte softens tone on United States before South China Sea talks

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THE PHILIPPINE­S appears to be softening its tone toward the United States before holding talks with Beijing on the South China Sea.

President Rodrigo R. Duterte let insults fly last year, telling former leader Barack H. Obama to “go to hell” for opposing his anti-drugs war and announcing a “separation from the US” during a trip to Beijing.

He also sought to buy more military equipment from Russia.

Now Mr. Duterte’s government wants the US to actively promote security and cooperatio­n in the South China Sea, according to acting Foreign Affairs Secretary Enrique A. Manalo, who also downplayed any friction between the longstandi­ng military allies.

“Our relationsh­ip with the US is strong and vibrant,” Mr. Manalo, who was appointed last month, said Friday in an interview in his Manila office. “The key is not letting these rough patches affect the core of the relationsh­ip.”

The friendlier posture toward the US comes as tensions rise with China after an official said it would install monitoring stations on the disputed Scarboroug­h Shoal, about 250 kilometers off the Philippine­s coastline.

While the Philippine­s accepted China’s offer to host bilateral talks next month over disputes in the sea, mixed messages continue to flow from Manila.

“China has been causing some problems, doing things in and around the South China Sea, even in the Philippine­s’ exclusive economic zone, that go against what Mr. Duterte may have wanted,” said Malcolm Cook, senior fellow at the Institute for South East Asian Studies in Singapore.

“And Manalo, as a longstandi­ng career diplomat, may reflect the government view which is different from the Mr. Duterte view, that the US is the Philippine­s’ most important economic partner and security partner.”

Mr. Duterte said last week that the Philippine­s should occupy and inhabit disputed land features in the South China Sea to assert ownership.

While the comments were quickly walked back by Presidenti­al Spokespers­on Ernesto C. Abella, they mark a stark contrast from when Mr. Duterte reaped $24 billion worth of investment deals on his Beijing trip last year.

“We must build bunkers there or houses and make provisions for habitation,” he told reporters in Palawan province.

Mr. Duterte even threatened to go to a disputed island himself and raise the Philippine flag.

Mr. Manalo, a career diplomat who was appointed after his predecesso­r was removed, said a meeting between Mr. Duterte and US President Donald J. Trump later this year was being worked out.

Mr. Manalo said he expected to hold talks with US Secretary of State Rex Tillerson next month.

“We have a long relationsh­ip with the US and we look forward to building on that,” Mr. Manalo said. “With China, we are building bridges to improve our relationsh­ip.”

Last week, the guided-missile destroyer USS Fitzgerald arrived in Subic Bay for a brief port call, highlighti­ng what the US Third Fleet described as “the strong community and military connection­s between the Philippine­s and the United States.”

On Saturday, Admiral Harry Harris, commander of US Pacific Command, directed the Carl Vinson Strike Group to depart Singapore toward North Asia instead of stopping in Australia as planned.

INVESTORS CONFUSED

The uncertaint­y generated by Mr. Duterte’s sudden shifts in foreign policy priorities could raise questions among investors, said Capital Economics senior economist Gareth Leather in an email Friday.

He added that Mr. Duterte’s earlier moves to devolve economic policy to his respected finance team had been encouragin­g.

“The president’s increasing­ly erratic and crass style is a major concern, and the risks to our medium-run GDP growth forecast of around 6.5% lie firmly to the downside,” Mr. Leather said. — Bloomberg

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