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The Aquino Administration's Balancing Policy against

an Emergent China: Its Domestic and External
Dimensions

Article  in  Pacific Affairs · March 2014

DOI: 10.5509/2014871005

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 The Aquino Administration’s
Balancing Policy against an
Emergent China: Its Domestic
and External Dimensions
Renato Cruz De Castro

Abstract
This article examines why and how small powers balance big powers. One
such small power is the Philippines, which—despite its military weakness—
applies a balancing policy on an emergent China relative to the South
China Sea imbroglio. Largely, this balancing policy is the upshot of three
developments: a) the present Aquino administration’s efforts to disassociate
itself from the previous Arroyo administration’s policy of equi-balancing
China and the US; b) China’s heavy-handed behaviour in the South China
Sea dispute; and c) the willingness of the US to assist the Philippines in
constraining an assertive China. In conclusion, the article offers two reasons
why this balancing policy is risky and difficult. First, the Philippines needs
time and resources to develop the military capability to back its territorial
claim in the South China Sea; and second, the US, though supportive of
the Philippine position, is wary of triggering a full-blown geo-strategic
rivalry with China.

Keywords: Philippine-China relations; Philippine foreign policy; South

China Sea dispute; Philippine-US relations.

DOI: http://dx.doi.org/10.5509/2014871005

O
n April 10, 2012 the Philippine Navy’s flagship, the BRP Gregorio Del
Pilar, tried to apprehend several Chinese fishing boats in the
Scarborough Shoal. However, two Chinese maritime surveillance
vessels arrived and blocked the arrest of the Chinese fishermen, who were
hauling corals, clams and live sharks into their boats. To prevent the incident
__________________

Renato Cruz De Castro has written over 70 articles on international relations and security that
have been published in a number of scholarly journals, edited works and monographs in the
Philippines, South Korea, Canada, Malaysia, France, Singapore, Taiwan, Germany, the United Kingdom
and the United States. He is a professor in the International Studies Department, De La Salle University,
Manila, and the holder of the Charles Lui Keung Professorial Chair in China Studies.

© Pacific Affairs: Volume 87, No. 1 March 2014 5

 Pacific Affairs: Volume 87, No. 1 – March 2014

from escalating into an armed clash, the Philippines replaced its surface
combatant with a smaller coast guard vessel. Instead of reciprocating, China
raised the stakes by deploying the Yuzheng 310—its most advanced and
largest patrol ship equipped with machine guns, light cannons and electronic
sensors. This incident underscores a stark reality: China’s naval power casts
a shadow over the Philippines, which (along with Vietnam) is at the forefront
of the South China Sea dispute with China.1 China specifically targets the
Philippines in a brinkmanship game in as much as the latter openly challenges
its expansive maritime claim in the South China Sea.
Notwithstanding the dismal state of its military, the Philippines adopts a
delicate balancing policy vis-à-vis an assertive China. In mid-2011, it decided
to pursue the substantial modernization of the Armed Forces of the
Philippines (AFP) that is still preoccupied with internal security operations
against domestic insurgent groups. President Benigno Simeon Aquino
ordered the Philippine Navy (PN) to speed up the acquisition of second-
hand cutters from the US Coast Guard, and the Philippine Air Force (PAF)
to scour the international market for affordable jet fighters to rebuild the
country’s air defense system. His administration also acknowledged the need
for US diplomatic support and military assistance in view of the Philippines’
territorial row with China. Consequently, President Aquino deviated from
his predecessor’s policy of equi-balancing China and the US and tilted the
balance in favour of the country’s long-time strategic ally.2 This policy shift
has a two-pronged consequence: it strengthens the Philippine-US alliance
while straining Philippine-China bilateral relations.
This article examines past and present developments that have shaped the
Aquino administration’s balancing policy on an emergent China. Relative to
this balancing policy on China, it specifically addresses this theoretical
problem: Why do small powers balance big powers despite the obvious power
asymmetry between them? It also examines the following questions: What are
the internal and external factors behind the Aquino administration’s balancing
policy? What are the components of this balancing policy? What are its
attendant risks and problems? Can the Aquino administration sustain this
diplomatic posture toward China? What is the future of this balancing policy?

__________________

1
William Chong, “Path to Scarborough Far from Fair: South China Sea Rivals no Match for
China’s Economic, Military Clout,” The Strait Times (21 April 2012), 1; available at http://search.
proquest.com/docview/1008636649/fulltext/1368A3A.
2
Equi-balancing is a small power’s policy of fostering an array of activities and linkages with
two competing major powers to a level whereby it is able to shape or influence their policies and
protect itself from undue external influence. Patterned after Thailand’s nineteenth-century policy of
balance of interests, it involves the small or weak power accepting, facilitating and pitting the big
powers against each other in an international situation where the latter will eventually square off with
each other in the process. This affords small states not only the ability to maneuver and survive, but
also the chance to use the situation to advance their own political and strategic advantage.

6
 The Philippine Balancing Policy

Why Do Small Powers Balance Big Powers?

Mainstream realist literature ordinarily depicts an anarchic world in which
states have two alternative responses to an emergent power. First, some states
may balance the emergent power to preserve their security, or second, they
may jump on the bandwagon to secure economic gains or expand their
influence.3 Realism maintains that a state adopts a balancing policy in order
to prevent a preponderant power from undermining the balance of power.4
The Marxist/neo-Marxist school argues that external economic factors (such
as big and powerful capitalist states, multinational corporations, international
banks, and multilateral lending institutions) induce a state to balance against
an emerging and potentially revisionist power because it is economically
dependent on a status quo power. Both the realist and Marxist theories offer
a systemic and mechanic explanation of balancing that emphasizes either
international anarchy or economic domination. Both theories, however,
ignore the possibility that a state’s decision to balance or bandwagon against
an emergent power might have to do with its respective national capabilities,
size, location and, more importantly, domestic politics.
Small or minor powers have limited economic and military capabilities.
Many of them consider balancing an emergent regional power detrimental
and risky. For a balancing policy to succeed, a state must have the essential
military power, a demographic advantage, and a strong technological/
industrial base. Generally, small powers have scarce natural resources,
constrained geography, a small population, diverse ethnic composition and,
in many cases, weak state institutions.5 Thus, it is assumed that balancing
cannot be effectively applied by small or minor powers since they have
marginal capabilities to affect international outcomes.
Historically, however, the emerging power’s preponderance does not
guarantee it will not be challenged by small powers. Small powers do apply
balancing strategies against major powers despite the military and diplomatic
disparities between them, e.g., Finland against the Soviet Union in 1939–1940,
and North Vietnam against the US in the 1960s. Clearly, inferences based
on systemic factors or relative power relations cannot explain why small
powers challenged big powers and in certain cases, even provoked or
instigated an international crisis or an armed conflict.6 The reasons why
__________________
3
Jack Levy, “Balances and Balancing: Concepts, Propositions, and Research Designs,” in Realism
and the Balancing of Power, eds. John A. Vasquez and Colin Elman (New Jersey: Pearson Education,
2003), 129.
4
Stephen M. Walt, The Origins of Alliances (New York: Cornell University Press, 1987), 17.
5
Small or minor powers are generally small or even medium-sized states whose territory,
population and resource base make it difficult for them to defend themselves against external military
attacks or other forms of big power intervention. See Laura Neack, The New Foreign Policy: US and
Comparative Foreign Policy in the 21st Century (Maryland: Rowman and Littlefield Publishers, 2003),
108–159.
6
Steve Chan, “Preventive War by the Weak: Loss Aversion, Strategic Anticipation and Third
Power Intervention,” Tamkang Journal of International Affairs (January 2011) XIV, III, 4.

7
 Pacific Affairs: Volume 87, No. 1 – March 2014

small powers ignore asymmetrical power relations and adopt a balancing

policy can be geography, national capabilities and domestic politics, such as
the results of elections and the individual leader’s ability to manipulate local
circumstances to achieve disproportionate power relations with the big
powers. If global conditions for their balancing gambits are ripe, small powers
can either draw on their geostrategic location to exert leverage on the
powerful state or rely on other major powers for military assistance and a
security guarantee.
The Philippines is an interesting case of a small power applying a balancing
policy on China despite the latter’s economic and military preponderance.
Since 2011, President Aquino has challenged China’s expansive territorial
claim in the South China Sea. After taking over the reins of government in
2010, he junked the policies of former president Gloria Macapagal Arroyo,
including her diplomatic strategy of equi-balancing China and the US. He
redirected the AFP’s focus from domestic security to territorial defense. He
also promoted closer security relations between the US and the Philippines;
acquired American military equipment; sought from Washington an equivocal
security guarantee under the 1951 Mutual Defense Treaty (MDT); and gave
the US strategic access to Philippine territory. All these efforts are aimed at
balancing an assertive China relative to the South China Sea imbroglio.

The Policy of Equi-balancing

The diplomatic strategy of equi-balancing the US and China was the primary
component of the foreign policy of the Arroyo administration. It surfaced
in November 2001 with the presidential pronouncement entitled “The Eight
Realities of Philippine Foreign Policy,” which contained bold diplomatic
gambits such as balancing the major powers (United States, Japan, and
China) in East Asia to ensure national security.
The 9/11 terrorist attacks on the US, which occurred two months earlier,
and the global coalition against terrorism gave Manila the opportunity to
enlist Washington’s support for the Philippines’ internal security agenda.
After its quasi-constitutional seizure of political power in early 2001 from
then president Joseph Estrada, the fledgling Arroyo administration sorely
needed American aid to strengthen the Philippine military’s counter-
insurgency and counter-terrorism capabilities. President Arroyo declared
her full support for Washington’s war on terror by offering American forces
access to the country’s air-space and allowing US Special Forces to conduct
training operations with the AFP in Basilan, Mindanao. Subsequently, the
Philippines became one of the principal recipients of American security
assistance, and an important front in the US military’s expanded counter-
terrorism operations against the al-Qaeda in Southeast Asia.
During President Arroyo’s term, economic ties between China and the
Philippines expanded. Bilateral trade grew dramatically from US$2 billion

8
 The Philippine Balancing Policy

in 1998 to US$30 billion in 2007. She facilitated the Chinese-funded North

Luzon Railway project to symbolize the “new and friendly relations and
cooperation between the Philippines and China.”7 Furthermore, she took
up President Hu Jintao’s challenge for Manila and Beijing to collaborate
strategically in pursuit of peace and economic development. This partnership
was reflected in the frequent exchange visits of officials; the increased level
of bilateral trade; conduct of the Joint Marine Seismic Undertaking (JMSU)
in the exploration and development of resources in the South China Sea;
intensified cooperation in the global campaign against terrorism and
transnational crimes; and policy coordination in implementing the ASEAN-
China Free Trade Agreement.8
President Arroyo used the American-led campaign against terrorism and
China’s economic emergence to engage the two major powers in a delicate
equi-balancing game. Her motive was to generate external resources to
achieve her main security goal: containing the persistent domestic
insurgencies. On the one hand, the country’s participation in the US war
on terror enabled the Arroyo administration to get millions of dollars in
security and economic assistance. On the other hand, China’s emergence
and burgeoning trade with the ASEAN states made the behemoth an
important market for Philippine exports.

The Focus on Internal Security

The Philippine-China entente during President Arroyo’s term defused the
tensions in the South China Sea. The Arroyo Administration ordered the
AFP to focus on internal security, a move which bore heavily on the military
and deteriorated its territorial defense capabilities. In late 2001, President
Arroyo issued Executive Order No. 21, or the National Internal Security Plan
(NISP). It called for a holistic approach—consisting of political, socio-
economic/psychological, security and information components—to stamp
out the root causes of the armed insurgencies. The three major insurgent
movements include : a) the Communist Party of the Philippines—New
People’s Army (CPP-NPA); b) the Moro Islamic Liberation Front (MILF) in
Mindanao; and c) terrorist groups like the Abu-Sayaff.
In response, the AFP formulated the 2002 Operational Plan Bantay Laya
(Freedom Watch) to “intensify the conduct of counter-insurgency operations”
and eradicate the Abu Sayaff and the NPA, the CPP’s military arm. The anti-
insurgency program also tasked the military with neutralizing the MILF to
__________________
7
BBC Monitoring Asia Pacific, “Chinese President Predicts China-Philippine Trade Relations,”
(28 April 2005), 1, available at http://proquest.umi.com/pqdweb?index=49&did=828416651&Srch
Mode=1&Fmt=3 (accessed 28 August 2008).
8
Xinhua News Agency, “Chinese President Calls for Further Expanding and Deepening
Cooperation with Philippines,” 28 April 2005, 1, available at http://proquest.umi.com/pqweb?inde
x=54&did=828380501&SrchMode=1&si=1&sid=1&Fmt=3 (accessed 28 August 2008).

9
 Pacific Affairs: Volume 87, No. 1 – March 2014

create a secure environment in Mindanao conducive for national

development. In the process, however, the AFP saw that its combat
capabilities and government support were inadequate to end the communist
insurgency by 2010, and to effect the disarmament, demobilization and
integration of the MILF.9
The Arroyo Administration’s Bantay Laya (Freedom Watch) was patterned
after the Aquino administration’s, and later the Ramos administration’s,
Lambat Bitag (Fishing Net) strategy. It deployed Special Operation Teams
(SOTs) in combination with civil-military operations. However, Freedom
Watch differed in these respects: a) Freedom Watch used the “Win-Hold-
Win” tactic that involved a lengthy deployment of combat units in
rebel-infested territories; b) the AFP assumed full responsibility in the
conduct of both combat operations and socio-civic /humanitarian missions;
and c) the government concentrated most of the military’s assets and
resources in the pursuit of a particular objective: the defeat of all the
insurgent movements by 2010. In adopting the Freedom Watch Strategy, the
Arroyo Administration bolstered the military’s role in domestic security
planning and implementation, which, in effect, “makes the civilians
dependent on the military’s coercive power and thus, inhibits the reduction
of military prerogatives in internal security.”10
Focused on internal security, however, the AFP’s territorial defense
development efforts were relegated to the sidelines. Materials intended for
territorial defense were used for internal security purposes. Furthermore,
limited financial resources for the AFP modernization were diverted to
personnel cost and combat operations. As a result, an average of 70 percent
of the defense budget went to personnel services, while only about 29 percent
was allotted for maintenance and other operating expenses (MOE).11 An
internal AFP paper bemoaned: “Unfortunately, this proportion for personnel
and MOE leaves nothing for capital outlay which is necessary for the
organizational development of the armed forces.”12
In downsizing its modernization plan, the Philippine military simply
improved existing capabilities through the AFP Capability Upgrade Program
(CUP). The program involved refurbishment of transportation, upgrade of
military firepower, and improvement of communication facilities for internal
security operations. From 2002–2011, the AFP’s shopping list consisted of
combat helmets, body armor, squad-machine guns, combat life-saver kits,
__________________
9
Herrboy Aquino, “An Analysis of Two Key Security Challenges Facing the Philippine Republic
over the Next Ten Years,” Digest: A Forum for Security and Defense Issues (3rd Quarter 2010), 51.
10
Aurel Croissant and David Kuehn, “Patterns of Civilian Control of the Military in East Asia’s
New Democracies,” Journal of East Asian Studies 9 (2009), 187.
11
Katheline Anne S. Tolosa, “Owing Sovereignty,” Digest: A Forum for Security and Defense Issues
(4th Quarter 2008), 7.
12
Noel L. Patajo, “Measuring the Cost of Insurgency,” Digest: A Forum for Security and Defense
Issues (3rd Quarter 2006), 8.

10
 The Philippine Balancing Policy

ground attack planes, and night-capable attack helicopters. Instead of

replacing its aging F-5A fighter planes with F-16 Falcons or Tornadoes, the
military prioritized the acquisition or reconditioning of Killer Medium patrol
crafts from South Korea, OV-10s from Thailand, and UH-1H Huey helicopters
from the US. These capability upgrade projects were undertaken on the
assumption that the Philippines would not face any external security
challenge until 2018. Acquisition of weapon systems for territorial defense
was never considered, and consequently, plans to purchase military hardware
and to conduct training for external defense remained essentially on paper
and only in theory.13
Eventually, scarce military resources were concentrated on internal security
operations. For example, in 2005, the AFP leadership decommissioned the
PAF’s remaining F-5 A/B fighters. This left the country devoid of any external
defense capabilities. Accordingly, the move came after the Department of
National Defense (DND) determined that there was “no immediate external
security threat to the Philippines.”14 Because there were no fighter planes,
the PAF deactivated the Air Defense Command (ADC) as part of the
“restructuring effort of the AFP to focus more on internal security.” 15
The Arroyo administration’s policy of equi-balancing the US and China,
the Philippine-China entente, and the military’s focus on internal security
to the detriment of territorial defense all happened during China’s charm
offensive in Southeast Asia. Through economic links and adroit diplomacy
in the early twenty-first century, Beijing succeeded in erasing the image of
China as a regional security threat bent on building up its military capability.
Through its foreign policy gambit of peaceful emergence, China was
perceived as a responsive and benign regional power by many Southeast
Asian states, including the Philippines. External and internal developments
after 2008, however, rendered President Arroyo’s policies untenable to her
political successor.

Changing the Regional Power Game

With a robust economy, China has gradually established a formidable navy.
This navy has shifted from pre-empting possible US intervention in a Taiwan
Straits crisis to developing the capacity to deny the US Navy access to the
East China Sea and the South China Sea or inside the so-called “First Island
__________________

13
Kathleen Mae M. Villamin, “Defending Philippine Territorial Integrity in the 21st Century,”
Digest: A Forum for Security and Defense Issues,” (1st and 2nd Quarters 2009), 8.
14
Anonymous, “Philippine Air Defense Compromised by Fighter Decommissioning—Officer,”
BBC Monitoring Asia-Pacific (03 October 2005), 1, available at http://search.proquest.com/docview/
460669464/13670C8477F6CE.
15
Anonymous, “Philippine Air Force Restructured to Focus on Internal Security,” BBC Monitoring
Asia-Pacific (3 April 2005), available at http://search.proquest.com/docview/461043248/13670C84
77F6CE.

11
 Pacific Affairs: Volume 87, No. 1 – March 2014

Chain” (an imaginary line that runs from Japan-Okinawa-Taiwan and down
to the Philippines). China has had an annual double-digit increase in defense
spending since 2006. At the advent of the twenty-first century, China has also
introduced three new classes of destroyers (Luyang I, Luyang II and Luzhou)
with more capable radar and air-defense weapon systems as well as frigates
(Jiangwei II, Jingkai I and Jingkai II) with improved war-fighting capabilities
and seaworthiness.16 This capability upgrade enables the PLAN to broaden
its operational range from the first island chain to the second island chain,
which extends from northern Japan to the Northern Marianas Islands, Guam
and further south to Palau.17
With its naval power, China generates regional tension by challenging the
claims of smaller littoral states over parts of the South China Sea, and by
changing the strategic pattern in the maritime commons in East Asia and
the West Pacific where the US Navy could be eased out. Interestingly, Chinese
media commentators, academics and analysts unanimously emphasize the
importance of naval power to protect China’s sovereignty over its surrounding
waters. They contend that the PLAN should have limitless operational range,
and must possess blue-water capabilities to show a military presence at sea,
provide deterrence, and conduct military diplomatic missions.18 Boosted by
increased budgets and improved domestic shipbuilding capabilities, the
PLAN is at the forefront of Chinese military modernization and has been
on the cutting edge of Beijing’s military diplomacy. More significantly, it
serves as an effective instrument in the pursuit of China’s national policy as
East Asia’s traditional great power.
As East Asia’s historical great power, Chinese decision makers since 1949
have considered two objectives as the country’s constant and vital security
goals:19 a) maintaining its status as the middle kingdom or the preeminent
power in East Asia; and b) erasing the memories and legacies of the “Century
of Humiliation.” The first value pertains to China’s ancient status as the
culturally and politically dominant power in East Asia and shaping the
regional order according to its interest. The other requires China to remove
all the legacies of the century of humiliation and to restore its rightful place
as the only great power in East Asia.
__________________
16
Ronald O’Rourke, “PLAN Force Structure: Submarines, Ships, and Aircraft,” in The Chinese
Navy: Expanding Capabilities, Evolving Roles, eds. Phillip C. Saunders, Christopher Yung, Michael Swaine
and Andrew Nien-Dzu-Yang (Washington, DC: National Defense University Press, 2011), 154–155.
17
Nan Li, “The Evolution of China’s Naval Strategy and Capabilities: From ‘Near Coast’ and
‘Near Sea’ to ‘Far Seas,’” in The Chinese Navy: Expanding Capabilities, Evolving Roles, eds. Phillip C.
Saunders, Christopher Yung, Michael Swaine and Andrew Nien-Dzu-Yang (Washington, DC: National
Defense University Press, 2011), 129.
18
Daniel M. Hartnett and Frederic Vellucci, “Toward a Maritime Security Strategy: An Analysis
of Chinese Views since Early 1990s,” in The Chinese Navy: Expanding Capabilities, Evolving Roles, eds.
Phillip C. Saunders, Christopher Yung, Michael Swaine and Andrew Nien-Dzu-Yang (Washington,
DC: National Defense University Press, 2011), 101.
19
David Scott, China Stands Up: The PRC and the International System (London and New York:
Routledge, 2007), 7–14.

12
 The Philippine Balancing Policy

Chinese policy makers now assumed that China has the strategic initiatives
to further pursue these two goals of maintaining its status as East Asia’s only
legitimate great power and removing the vestiges of the century of
humiliation. This involves not only reducing American strategic clout and
influence in the region but possibly displacing them or, as one American
scholar described it, acting as “the Game Changer.”20 As the game changer,
China is pursuing its national security goals by developing its naval power,
matching its growing economic and military prowess with an equally
aggressive media strategy, and pursuing an activist foreign policy vis-à-vis
Washington, forcing the latter to evaluate its strategy vis-à-vis Beijing.21
This game changer gambit became evident in late August 2010 (two
months after President Benigno Aquino III assumed office), when China
sent a belligerent message to the other claimant states (specifically Vietnam
and the Philippines) and the US, that its claim of sovereignty over the sea
and its islands is “indisputable.” The PLAN conducted a live-fire exercise in
the South China Sea that involved its three major fleets (the South China
Sea, North Sea, and East Sea Fleets) using surface combatants, along with
fighter plane strikes and missile launches against hypothetical long-range
targets.22 Such show of force proved that China has developed the capacity
to sustain a larger naval deployment deep into the South China Sea.

The Primacy of Domestic Politics

The change in China’s behaviour in the South China Sea coincided with the
victory of an opposition candidate who won by a clear mandate from the
Filipino electorate. President Benigno Simeon Aquino III won the 2010
presidential election by capturing 42 percent of the votes cast, the largest
margin of victory since the Philippines adopted a multi-party system in 1987.
During his inauguration in July 2010, President Aquino criticized the past
administration for corruption, political impunity and indifference to the
plight of ordinary Filipinos. He announced a two-pronged approach to good
governance, namely: a) a crackdown on corruption; and b) an investigation
and prosecution of key leaders of the previous administration for political
and criminal wrongdoing.
He formed a Truth Commission to investigate former president Arroyo
for allegedly oppressing the people, fired her so-called midnight appointees;
replaced her designated AFP chief-of-staff General Delfin Bangit with General
__________________
20
Elizabeth C. Economy, “The Game Changer: Coping with China’s Foreign Policy Revolution,”
Foreign Affairs 89, 6 (November/December 2010): 142–152.
21
Elizabeth C. Economy, “The Game Changer: Coping with China’s Foreign Policy Revolution,”
Foreign Affairs 89, 6 (November/December 2010): 149–152.
22
Barry Wain, “Chinese Diplomacy Off Course,” Wall Street Journal, 5 August 2010, 13, and
National Institute for Defense Studies, National Institute for Defense Studies: China Security Report (Tokyo:
National Institute for Defense Studies, 2011), 17.

13
 Pacific Affairs: Volume 87, No. 1 – March 2014

David De Leon; forced the resignation of appointed ombudsman Merceditas

Gutierrez; and replaced foreign secretary Alberto Romulo (who served as
President Arroyo’s foreign secretary for five years and President Aquino’s
foreign secretary in a holdover capacity for six months) with former
Philippine ambassador to the US, Alberto del Rosario. The following year,
President Aquino had his predecessor arrested without bail on charges of
electoral fraud. In the first two years of his term, President Aquino waged
an Anything-But-Arroyo (ABA) campaign with the rallying cry, “there can
be no reconciliation without justice” against the previous administration.23
As a result, President Arroyo’s equi-balancing strategy, and the Philippine-
China entente, became casualties of President Aquino’s determination to
disassociate his administration completely from its predecessor.
In his first year in office, President Aquino tried to maintain cordial
relations with China. In late 2010, the Philippines joined a 19-state coalition
led by China that did not send any representatives to the awarding ceremony
in Oslo, Norway for the Nobel Peace Prize winner, Chinese dissident Liu
Xiaobo. In February 2011, President Aquino ordered the extradition to
China of 14 Taiwanese accused by Beijing of committing electronic fraud
against Chinese nationals. This caused a major diplomatic rift between Manila
and Taipei. In due time, however, President Aquino realized that kowtowing
to China does not exempt one from being singed by Chinese aggressive
behaviour in the South China Sea.24
On March 2, 2011, two Chinese patrol boats harassed a survey ship
commissioned by the Philippine Department of Energy (DOE) to conduct
oil exploration in the Reed Bank (now called Recto Bank), 150 kilometres
east of the Spratly Islands and 250 kilometres west of the Philippine island
of Palawan. The Aquino Administration was stunned by the Chinese action
since this maritime encounter happened east of the Spratly Archipelago and
its adjacent waters. Two days after the incident, the Philippine government
filed a protest before the Chinese embassy in Manila. A Department of
Foreign Affairs spokesperson commented that “the Philippines is (simply)
seeking an explanation for the incident.” Brushing aside the Philippine
complaint, a Chinese embassy official insisted that China has indisputable
sovereignty over the Nansha Islands and their surrounding waters.
In early June 2011, the Philippines sought clarification on the sightings
of China Marine Surveillance (CMS) and PLAN ships near the Kalayaan
group of islands. Both the secretaries of Philippine defense and foreign
affairs expressed the Aquino administration’s serious concerns over the
Chinese intrusion into the country’s EEZ to stake a claim and to possibly
__________________
23
Edilberto C. De Jesus, “The Philippines in 2010: Reclaiming Hope,” Southeast Asian Affairs
2011, ed. Daljit Singh (Singapore: Institute of Southeast Asian Studies, 2011), 223.
24
“Singed by the Dragon; The Philippines Discovers that It Doesn’t Pay to Appease China,” Wall
Street Journal (31 March 2011), 1, available at http://proquest.umi.com/pqdweb?index=96&did=23
07204961&Src.

14
 The Philippine Balancing Policy

construct an oil rig on the uninhabited Iroquois Bank. According to them,

these “are clear violations of the China-ASEAN 2001 Declaration on the
Conduct of Parties on the South China Sea.”25 In response, the Chinese
foreign ministry sternly told the Philippines to stop “harming China’s
sovereignty and maritime rights and interests, which leads to unilateral
actions that can expand and complicate the South China Sea dispute.”26
Beijing went on to demand that Manila first seek Chinese permission
before it conduct oil exploration activities even within the Philippines EEZ.
China, in fact, was badgering the Philippines and other claimant states to
recognize China’s sovereign claim over the South China Sea. 27 China’s
bullying tactics and arrogant pronouncements against the Philippines and
Vietnam in the first half of 2011 exacerbated the territorial row. By then,
President Aquino had realized that the Philippines was potentially on a direct
collision course with China regarding the South China Sea issue.

From Internal Security to Territorial Defense

In his campaign sorties during the 2010 election, then presidential candidate
Benigno Simeon Aquino III alleged that the Arroyo administration and the
AFP colluded in the massive 2004 electoral fraud in Mindanao, malversation
of public funds, and extra-judicial killings of political activists when the military
intensified its internal security operations against the domestic insurgents.
Upon assuming the presidency in June 2010, he vowed to observe transparency
and accountability in governance, and to modernize the AFP in line with
shifting its focus from internal security to maritime/territorial defense.
The 2010 AFP Internal Peace and Security Plan (ISP)—Oplan Bayanihan
(Operational Plan Community Spirit)—detailed the Aquino Administration’s
plan for such a transition. The plan acknowledged the AFP’s lack of capabilities
to perform its mandated task of guarding the Philippines’ extensive maritime
borders and ensuring its security from external threats.28 It also provided for
a three-year period within which the Philippine military would redirect its
attention towards developing capabilities to undertake unilateral defensive
operations against any form of external armed aggression.29
__________________

25
Carl Thayer, “China’s New Wave of Aggressive Assertiveness in the South China Sea,”
International Journal of China Studies 2, 3 (December 2011). 563.
26
Anonymous, “China Says Philippines Harming Sovereignty, Interests in Spratlys,” BBC
Monitoring Asia-Pacific (9 June 2011), 1, available at http://proquest.umi.com/pqdweb?index=64&d
id=2369715781&Src.
27
“China Wants Philippines to Seek Permission before Spratlys Oil Search,” BBC Monitoring
Asia-Pacific (10 June 2011), 1, available at http://proquest.umi.com/pqdweb?index=281&did=2370
661661&Sr.
28
General Headquarters, Armed Forces of the Philippines, Armed Forces of the Philippines Internal
Peace and Security Plan (Quezon City: General Aguinaldo, 2010), 8.
29
General Headquarters, Armed Forces of the Philippines, Armed Forces of the Philippines Internal
Peace and Security Plan, 13. As part of its efforts to shift the military’s focus away from internal security
to territorial defense, the Philippine government signed a land-mark peace deal with the MILF in

15
 Pacific Affairs: Volume 87, No. 1 – March 2014

Corollary to the ISP, the Department of National Defense (DND) and the
AFP drew up the 2010 AFP Long-Term Capability Development Plan. It
proposed the re-evaluation of military priorities and the urgent upgrading
of the AFP’s weapons system.30 It also called for a change in strategic planning
from counter-insurgency/counter-terrorism to maritime contingencies that
might originate from the South China Sea dispute. This posture required
joint PAF-PN capabilities for maritime domain awareness, defensive naval
operations, and interdiction. For the PAF, the plan necessitated an air defense
system development, close air support, and battlefield air interdiction
capabilities, as well as the capacity to conduct maritime patrol and
reconnaissance. For the PN, it required the acquisition of multi-role attack
vessels, off-shore patrol craft, and even surface-to-surface and surface-to-air
missiles. Specifically, it rationalized the upgrade of the PN fleet for “combined
maritime surveillance, defense, and interdiction operations in the South
China Sea.”
The March 2, 2011 incident at the Reed Bank and China’s arrogant
response to the Philippines diplomatic queries drove the Aquino
Administration to hasten the development of the AFP’s territorial defense
capabilities. In June 2011, the executive branch of the government and the
AFP agreed on a multi-year, multi-billion peso defense upgrade spending
and military build-up. The Department of Budget Management (DBM)
released a Multi-Year Obligation Authority (MOA) to the DND, allowing the
AFP to enter into multi-year contracts with other governments or private
arms and military hardware manufacturers. The DBM also committed Php
40 billion (estimated US$800 million) in the next five years (2012–2016) to
develop the AFP’s capabilities for greater domain awareness of the Philippine
territorial waters and EZZ.
In the proposed “rolling” program, per request from the executive branch,
the Philippine Congress will allocate Php 8 billion (an estimated US$160
million) annually for the procurement of air-defense surveillance radar,
surface attack aircraft, close air support aircraft, combat utility helicopters
and long-range patrol aircraft.31 Also covered are current upgrade programs
__________________
2012. The process gained momentum in April 2012, when both sides signed the “GRP (Government
of the Republic of the Philippines)-MILF Decision Points on Principles” in Kuala Lumpur that
recognizes Bangsamoro as a secular political unit within the Philippines, located within its territory,
and subject to its sovereignty as a state. Then, during the 32nd round of the Exploratory Talks on the
Peace Process in Kuala Lumpur, in early October 2012, the two parties agreed on the framework
agreement for the creation of a Bangsamoro entity to replace the Autonomous Region of Muslim
Mindanao (ARMM) composed of five Muslim-dominated provinces. Asia-News Monitor, “Philippines:
GRP, MILF Express Optimism in Reaching a Peaceful Settlement to Mindanao Conflict,” Asia News
Monitor (5 October 2012), 1, available at http://search.proquest.com/docview/1082304042/139A8
7060651EFB99B3/59?accountid.
30
Office of the Deputy Chief-of-Staff for Plans (J-5), DND-AFP Current Thrust in Upgrading AFP’s
Capability: AFP Long-Tern Capability Development Plan (Quezon City: Camp Aguinaldo, July 2010).
31
William B. Depasupil, “Armed Forces to Spend P14b to Upgrade Naval, Aerial defense,”
Tribune Business News (29 June 2011), 1, available at http://proquest.umi.com/pqdweb?index=48&
did=2386470651&Src.

16
 The Philippine Balancing Policy

such as the installation of a radar and communication network along the

coast of Palawan and Eastern Mindanao (originally aimed to monitor the
movements of terrorists in Sulu Sea) under the Coast Watch System and the
planned acquisition of three refurbished US Coast Guard Hamilton Class
Cutters by the Philippine Navy. These undertakings, according to former
AFP chief-of-staff General Eduardo Oban Jr., prioritize territorial defense
over domestic security.
In October 2011, DND Secretary Voltaire Gazmin released the Defense
Planning Guidance (2013–2018) restructuring the AFP to a “lean but fully
capable” armed forces to confront the challenges to the country’s territorial
integrity and maritime security. It envisions the development of an effective
force projection capability to monitor the Philippines’ territorial waters and
EZZ. It contains the following measures:32
a) reduction of infantry and marine battalions and the redirection of
limited financial resources to key priorities such as theatre mobility, close
air-support, air-surveillance and air-defense;

b) acquisition of naval assets for off-shore patrol, strategic sea-lift, and

accompanying base support system and platform to sustain the deployed
maritime assets;

c) development of the AFP’s long-range maritime air patrol and

surveillance through the acquisition of assets for long-range maritime
air patrol, and accompanying base support system; and

d) reactivation of the Philippine Air Defense System (PADS) through

the acquisition of air surveillance radar and a squadron of air defense/
surface attack aircraft to provide air defense coverage over areas of high
concern.

In its first 17 months in office, the Aquino administration spent Php 33.596
billion (US$387 million) to boost the AFP’s internal security and territorial
defense capability.33 According to Defense Secretary Gazmin, the DND-AFP
signed 138 defense contracts that will be implemented in the next five years
to improve the AFP’s force protection, maritime surveillance, transportation
and combat support system.34 General Oban’s successor, Lieutenant-General
Jessie Dellosa (of the Philippine Army), promised to support the AFP’s shift
to territorial defense. His major concerns include the full implementation
of the Internal Peace and Security Plan; organizational reforms to ensure
__________________
32
Secretary of National Defense Voltaire T. Gazmin, Defense Planning Guidance, 2013–2018
(Quezon City: Department of National Defense, 11 October 2011): 11–16.
33
“Philippines Spends US$387 million on Armed Forces Upgrade,” BBC Monitoring Asia-Pacific
(16 January 2012), 1, available at http://search.proquest.com/news/docview/916135970/
fulltext/1348.
34
Anonymous, “AFP Modernization Program in Full Swing-Gazmin,” The Philippines News Agency
(18 March 2012), 1, available at http://search.proquest.com/docview/928841133/1367BFEC0AA
BC.

17
 Pacific Affairs: Volume 87, No. 1 – March 2014

fiscal transparency within the military establishment; strengthening the AFP’s

territorial defense capabilities; and development of the PN to enhance
maritime security in the West Philippine Sea.35 Then in January 2012, the
DND reduced the number of army and marine battalions to divert resources
and personnel for internal security and civil-military operations to maritime
and territorial defense priorities.36
The Philippines’ territorial defense objective is to establish a modest but
“comprehensive border protection program.” This short-term goal requires
enhancing the AFP’s capabilities, prioritizing its needs, and gradually
restructuring its forces for territorial defense. The long-term goal, according
to the 2011 AFP’s Strategic Intent, is to develop the force structure and
capabilities enabling the Philippine military to maintain a “credible deterrent
posture against foreign intrusion or external aggression, and other illegal
activities while allowing free navigation to prosper.”37 Specifically, the AFP
plans to develop the following capabilities:
a) Enhancing maritime domain awareness—The AFP’s capability for
maritime surveillance is extremely limited. The establishment of the
National Coast Watch System in September 2011 to monitor the country’s
vast maritime environment requires air-assets, trained personnel, and
radars. The PAF acquisition of a long-range patrol aircraft, lead-in-fighter
jets and surface-attack aircraft addresses the need for maritime awareness
and limited naval interdiction capability, particularly within Philippine
territorial waters to the 200-nautical mile EEZ.

b) Joint operations between the PAF and the Navy for limited naval interdiction
capabilities—Given the Philippines’ inadequate defense budget and
defense capabilities, the PAF will support the Philippine Navy’s limited
naval interdiction operations. The PAF’s Air Defense System and the
PN’s Coast Watch System will provide coverage and augmentation for
over-the-horizon reconnaissance and targeting capabilities.38 Its maritime
patrol and surveillance aircraft will serve as the primary platforms of
patrols, surveillance and interdiction, while the PN’s surface combatants
would conduct helicopter patrol and provide longer on-station time, as
well as visible and enhanced naval presence/deterrence.39 The PAF’s
air-defense and coastal missile system will be linked with the navy’s surface
and underwater interdiction capabilities that will constitute the first layer
of maritime defense for the Philippines.
__________________
35
The Philippine News Agency, “New AFP Chief Vows to Focus on Territorial Defense, MILF
Peace Talks,” Philippine News Agency (13 December 2011), 1, available at http://search.proquest.com/
news/docview/910568320/fulltexr/1348.
36
BBC, “Philippines Mulls Reorganization of Military to Boost Territorial Defense,” BBC
Monitoring Asia-Pacific (02 January 2012), 1, available at http://search.proquest.com/
docview/913215230/fultext/1348735E9.
37
Office of the Deputy Chief-of-Staff, Armed Forces of the Philippines: Strategic Intent (Quezon City:
Camp Aguinaldo, 2011), 27.
38
Commodore Jose Renan C. Suarez, “The Imperatives of Defending the Philippines and Air-
Defense Partnership,” presentation at the Air Power Symposium 2012, 21 June 2012, SMX Convention
Center, Pasay City, Philippines, 6.
39
Commodore Jose Renan C. Suarez, “The Imperatives of Defending the Philippines and Air-
Defense Partnership,” 6.

18
 The Philippine Balancing Policy

Unfortunately, the Aquino Administration is constrained by limited

resources to fund these modest defense targets. As a case in point, in
November 2011, President Aquino announced the planned acquisition by
the PAF of two squadrons of second-hand F-16C/D through the US Excess
Defense Articles (EDA).40 However, the purchases might put tremendous
financial strain on the AFP, which is still engaged in internal security
operations. In fact, relative to the AFP’s Oplan Bayanihan, the PAF continues
to carry out the following counter-insurgency/counter-terrorism functions:41
a) intelligence-surveillance-reconnaissance (ISR); b) precision attack to
minimize collateral damages in its ground support operations; and c)
education and information dissemination campaign to win the people’s
hearts and minds.
In May 2012, President Aquino hinted that the PAF might acquire brand-
new lead-in jet trainers that can be converted into fighter planes by modifying
their air-frame.42 In an interview, he admitted that the government finds it
too expensive to buy, and much more to maintain, second-hand fourth-
generation jet fighters that only have five serviceable years. Hence, he raised
the possibility of buying cheaper new fighter aircraft from the United
Kingdom, France, Italy, or even South Korea. Furthermore, some Aquino
administration insiders are skeptical that China poses a security threat to the
Philippines, and are strongly against the projected increase in the defense
budget.43 Some of his cabinet members point out that no amount of defense
build-up would enable the AFP to stand up against a modern and nuclear-
armed PLA. According to them, challenging China’s maritime claim could
even mean losses for the Philippines in terms of trade and investments with
the second-largest economy in the world.44

Reconfiguring the Philippine-US Alliance

American policy makers have continuously debated China’s emergence as
a regional power. The bone of contention is China’s real intention and its
capability to challenge American leadership in East Asia. Some regard China
as a threat to US interests in this part of the world. Others believe that China
is a conservative, if not a constructive, regional status quo power. A few argue
that China is not powerful enough to challenge the US and may, in fact,
__________________
40
Jon Grevatt, “Philippines to Hasten Recreation of Dedicated Combat Wing with Ex-USAF
F-16 Purchase,” Jane’s Defense Industry 29, 1 (January 1, 2012), 1, available at http://search.proquest.
com/docview/910358069/1367C416F31C55.
41
Rino Francisco and Jose Antonio Custodio, “The Challenge of Air Force Modernization in
an ISO-Driven Strategy,” (unpublished manuscript), 3.
42
Aurea Calica, “Aquino: Government Can Now Afford to Buy New Fighter Jets,” The Philippine
Star (17 May 2012), 2.
43
Interview with a ranking official of the National Security Council, National Security Council,
Quezon City, 12 February 2013.
44
Interview with a ranking official of the National Security Council, National Security Council,
Quezon City, 12 February 2013.

19
 Pacific Affairs: Volume 87, No. 1 – March 2014

evolve into an American partner or a de facto ally. However, they are

unanimous in saying that China’s pervasive regional clout is a valid foreign
policy concern.
With this uncertainty, Washington adopts a proactive hedge strategy to
manage China’s capabilities and influence its intentions. In its initial form,
this hedge strategy assumes that among the emerging powers, China has the
greatest potential to challenge the US militarily in the future.45 This strategy,
however, regards China not as an immediate threat or a Soviet-style rival, but
as a power slowly heading for a showdown with the US and its alliance system.
Thus, Washington must always insinuate that America intends to remain the
dominant Pacific power and that China can ill afford a miniature arms race
or a geo-political rivalry with the US.46 This stance also requires the US and
its allies to strengthen their bilateral ties, limit Chinese influence among the
allies, and avoid any US-China confrontation.
The immediate goal of the hedge strategy is to influence China’s
emergence. To achieve this, the US has to constrain Chinese political/
strategic leverage on East Asian nations, while ensuring China’s access to the
regional economy. It must also deter China from initiating any conflict in
the Taiwan Strait or in the South and East China Seas, dissuade it from
engaging Japan or the US in a strategic competition in East Asia, and prevent
it from weakening the US-centred hub-and-spoke framework of bilateral
alliances and forward-deployed forces. At the same time, the US has to
expedite the military and economic development of its allies to counter
China’s hegemonic design. Former secretary of state Hillary Clinton
emphasized this point by saying that “we are working not just to sustain them
[the US bilateral alliances in East Asia] but to update them, so they remain
effective in a changing world.”47 Operationally, this entails downsizing the
US military presence in Northeast Asia in favour of diversifying America’s
strategic footprint throughout Southeast Asia, particularly in fostering
security cooperation and conducting capacity operations with its old and
new allies.48
In the case of the Philippine-US alliance, the hedging policy involves the
Pentagon’s material and technical assistance to develop the AFP’s capabilities.
One senior US Defense Department official commented in 2009 that “the
Pentagon will support Philippine forces fighting terrorists, while currently
__________________

45
Neil King, “Conflict Insurance: As China Boosts Defense Budget, US Military Hedges its Bets:
Pentagon Orchestrates Build-up of Forces in the Pacific; Counts on Japan,” Wall Street Journal (20 April
2006), A1.
46
Neil King, “Conflict Insurance: As China Boosts Defense Budget, US Military Hedges its Bets:
Pentagon Orchestrates Build-up of Forces in the Pacific; Counts on Japan,” A1.
47
Secretary Hillary Rodham Clinton, “America’s Engagement in the Asia-Pacific,” 28th October
2010 Speech delivered in Honolulu, Hawaii, 3.
48
Abraham M. Debmark and Brian M. Burton, “The Future of US Alliances in Asia,” Global Asia
5, 4 (Winter 2010), 58.

20
 The Philippine Balancing Policy

looking at ways to go beyond that current assistance.”49 Washington’s medium-

term goal is to assist the Philippine military in its counter-insurgency/
counter-terrorism efforts, maritime security concerns, and transition from
internal security to territorial defense. In return, it expects the Philippines
to assist in maintaining America’s key strategic interest in Southeast Asia—a
regional balance of power that tilts in favour of the US. At present, China
can undermine that delicate balance of power.
The US global war on terror in 2001, and later, the tension in US-China
relations after 2008 augured well for Philippines’ strategic agenda. Philippine-
US security relations were revitalized, and the alliance achieved two political/
strategic objectives. First, the Philippine government received US support
for its counter-terrorism/counter-insurgency campaign. Second, Washington
deepened its alliance with Manila not only to neutralize terrorist groups, but
also to counter Beijing’s political and economic influence in the country.
The US regularly extends technical training and defense assistance to the
AFP to maintain the Philippines to firm up their security partnership in the
face of growing Chinese military power and assertiveness.
Consequently, in 2010, China’s provocative behaviour in the South China
Sea caught the attention of the US-Philippine Mutual Defense Board (MDB),
the liaison and consultative body that oversees the Philippine-US defense
posture against external threats. The MDB annual meeting on August 18,
2010 discussed such security challenges as terrorism, domestic insurgency,
and potential flashpoints, specifically in the South China Sea dispute.50 Both
countries decided to complement each other’s military capabilities, enhance
inter-operability between their armed services, and strengthen the AFP’s
territorial defense capabilities with tangible US security assistance.
In late January 2011, the Philippines and the US held a strategic bilateral
dialogue to affirm their alliance and explore new areas for cooperation.
Then assistant secretary of state for East Asian and Pacific Affairs Kurt
Campbell told Filipino officials “that the Obama Administration is committed
to boost Philippine military’s capacities to patrol its waters as part of a larger
goal of keeping Asian sea lanes open.”51 The two sides discussed the need to
upgrade the Philippine military’s capabilities in maritime security through
these means: 52 a) US funding support to the AFP’s Capability Upgrade
Program, which includes acquisition of equipment, as well as extensive
__________________

49
Fred Baker, “Gates Visits the Philippines to Reaffirm US Commitment,” Armed Forces Press
Service, 1 June 2009, available at http://defenselink.mil/news/newsarticle.aspx?id=54569.
50
Interview with mid-level AFP Officers, Foreign Service Institute, Department of Foreign Affairs,
17 September 2010.
51
Sheldon Simon, “U.S.-Southeast Asian Relations: Dismay at Thai-Cambodia Skirmishes,”
Comparative Connection: A Triannual E-Journal on East Asian Bilateral Relations (31 May 2011), http://
csis.org/files/publication/1101gus_seasia.pdf, 3.
52
Co-Chair’s Statement, “Philippines-United States Bilateral Strategic Dialogue,” United States
Embassy in Manila, 27–28 January 2011, 10.

21
 Pacific Affairs: Volume 87, No. 1 – March 2014

refurbishing and maintenance of existing AFP material; and b) the provision

of additional funding of (US$40 million) for the Coast Watch South to boost
the Philippine military’s surveillance, communication and interdiction
capabilities in the western part of the country. In a press conference in
Washington on February 2, 2011, Assistant Secretary Campbell formally
announced US military assistance to the Philippines, particularly “the
provision of equipment through excess defense sales, training of elements
of their coast guard and navy and deeper consultations at a strategic, political,
and military level.”53
At the height of the Philippines’ territorial row with China in mid-June
2011, the Aquino Administration acknowledged the exigency for US
diplomatic support and military assistance. Executive Secretary Pacquito
Ochoa expressed hope that Washington would come to Manila’s aid if an
armed confrontation broke out in the Spratlys. He added that the Philippines
could invoke the 60-year-old Philippine-US Mutual Defense Treaty (MDT)
if the Spratly dispute becomes a military problem.54 The US ambassador to
the Philippines, Harry Thomas, readily pledged US support to the Philippines,
and stated: “The Philippines and the US are longstanding treaty allies. We
are strategic partners. We will continue to consult each other closely on the
South China Sea, Spratly Islands, and other issues.”55
Undoubtedly, the Philippine military needs new arms and equipment to
develop its territorial defense capability. Current US assistance includes the
acquisition of three US Coast Guard’s Hamilton-class cutters through the
Foreign Military Sales credit.56 Once delivered, these cutters would be the
most modern and largest vessels in the Philippine Navy’s inventory, replacing
its World War II-vintage destroyer escorts used for patrolling the high seas.57
Furthermore, these high-endurance cutters will be used to protect the
country’s oil exploration and drilling activities and territorial claims in the
South China Sea. The PN plans to retrofit the cutters with modern electronics
and surveillance equipment in order to monitor all surface movements and
__________________

53
Sheldon Simon, “U.S.-Southeast Asian Relations: Dismay at Thai-Cambodia
Skirmishes,” Comparative Connection (31 May 2011), http://csis.org/files/publication/1101gus_seasia.
pdf, 3.
54
Alastair McIndoe, “Manila Ups the Ante in Spratly Tussle,” Tribune Business News (14 June
2011), 2, available at http://proquest.umi.com/pqdweb?index=156&did=2373539321&SrchMode=
1&sid=1&Fmt.
55 Greg Torode, “US under Pressure over Sea Dispute Washington has Stopped Short of Specifics
on its Position under a Defense Pact with Manila on Recent Incursion by China in the South China
Sea,” South China Morning Post (17 June 2011), 2, available at http://proquest.umi.com/pqdweb?in
dex=177&did=2376593311&Sr.
56
“Philippine Navy to Acquire Largest Ship in Inventory,” GMA News (23 January 2011), 1,
available at http://www.gmanews.tv/print/211298.
57
Sheldon Simon, “US-Southeast Asia Relations: Dismay at Thai-Cambodia Skirmishes,”
Comparative Connections: A Triannual E-Journal on East Asian Bilateral Relations (May 2011), 5, available
at http://csis,org/files/publication/1101ques_seasia.pdf.

22
 The Philippine Balancing Policy

operations in the South China Sea.58 Curiously, this transfer perfectly fits
into AFP’s scheme of capability upgrade for internal security operations,
disaster response, and effective long-range patrol of the Philippines’ maritime
territories, but not for naval expeditionary warfare.59

Issues in the Philippine-US Alliance

Developing the PN and PAF’s capabilities for early warning, surveillance and
command, control, and communications is designed for limited “joint
operations capabilities” in maritime defense and interdiction operations.
According to the AFP’s 2008 Defense Plan Aguila (Hawk), AFP units will only
engage enemy forces if the latter penetrate deep into the Philippine Defense
Area of Interest (PDAI) and not to destroy the main forces but simply to
delay them until external assistance arrives.60 In this scenario, the AFP’s main
interdiction efforts will not be directed against the enemy’s main attack force
but against its command, and control, and communications, and support
elements.61 In this respect, the Philippines cannot match a militarily
aggressive China in any South China Sea encounter. Thus, Manila has asked
for unequivocal US commitment to Philippine defense and security as
provided by the 1951 Mutual Defense Treaty (MDT).
Since June 2011, the Philippines has sought American naval/air support
in the Spratlys. Philippine officials argue that an armed attack on Philippine
metropolitan territory and forces anywhere in the Pacific, including the
South China Sea, should trigger a US armed response. However, the 1951
MDT does not provide for any automatic response from either the Philippines
or the US. It only requires the allies to consult each other and determine
what military action, if any, both would take.
Former US secretary of state Clinton reaffirmed the US defense
commitment to the Philippines amid the rising tensions between Manila and
Beijing over the disputed Spratlys.62 During her June 23, 2011 meeting in
Washington with Philippine foreign affairs secretary Del Rosario, she
announced that the US would honour both its mutual defense treaty and
strategic alliance with its Southeast Asian ally. In November 2011, aboard
the USS Fitzgerald, she reiterated US assistance to the Philippines and called
for updating the defense treaty that “will require … greater support for
__________________
58
BBC, “Philippine Military Looks Forward to Arrival of New Warship,” BBC Monitoring Asia-
Pacific (25 August 2011), 2, available at http://proqust.umi.com/pqweb?index=13&did=243442382
1&SrchMode=1&sid=1&Fmt.
59
P. Ervin A. Manalo, “A Multi-Purpose Vessel for the Philippine Navy: Options and Prospects,”
Digest: A Forum for Security and Defense Issues (4th Quarter 2008), 15.
60
Interview with middle-ranking AFP Officers, Foreign Service Institute, 17 September 2010.
61
Interview with middle-ranking AFP Officers, Foreign Service Institute, 17 September 2010.
62
David Gollust, “Clinton Reaffirms US Commitment to Philippines amid Islands Dispute,”
Voice of America News/Find (23 June 2011), 1, available at http://proquest.umi.com/pqdweb?index=
171&did=2383500951&Sr.

23
 Pacific Affairs: Volume 87, No. 1 – March 2014

external defense, particularly maritime domain awareness.”63 She, however,

could not categorically tell what the US would do if China attacks a Philippine
ship or aircraft in the South China Sea.64 The current US position remains
silent on the nature and provisions of the treaty in case of armed aggression
against the Philippines. Likewise, the State Department stops short of making
any reference to an automatic response if armed conflict erupts in the South
China Sea.65 When pressed on the issue, it falls back on the cryptic official
line that since the US is a treaty ally of the Philippines, “China cannot simply
assert that events in the disputed South China Sea are not any of Washington’s
business.”66
The tensions in Sino-Philippine diplomatic relations, and a possible armed
encounter between the Philippines and China in the South China Sea,
however, have made the US position of strategic silence difficult. After the
April 2012 Scarborough Shoal stand-off between the two countries, President
Aquino asked for a definite security guarantee when he met President Barack
Obama at the Oval Office on June 8, 2012. President Obama answered that
the US will abide by its treaty obligation under the 1951 MDT. His standard
yet vague response somehow concealed the US predicament in the South
China Sea dispute—although it wants to assure the Philippines of its
unequivocal support, it does not intend to trigger an immediate and open
geo-strategic rivalry with China, which is a major American economic
partner.67
Actually, to ensure US military assistance to the Philippines in the case of
an armed clash in the South China Sea, American forces must be physically
positioned to provide immediate and timely support. US forces can effectively
assist the country’s ally only if they have access to facilities near the South
China Sea from where they could quickly and effectively respond to an armed
clash. During the August 16, 2011 meeting of the Mutual Defense /Security
Engagement Board, the allies agreed to develop a framework for heightened
bilateral and multilateral security, and domain awareness. The board
considered the following measures:68 a) rotational presence of US Maritime
__________________
63
Sheldon Simon, “US-Southeast Asia Relations: Rebalancing,” Comparative Connections: A
Triannual E-Journal on East Asian Bilateral Relations (January 2012), 4, available at http://csis.org/
files/publication/1103gus_seasia.pdf.
64
Sheldon Simon, “US-Southeast Asia Relations: Rebalancing,” Comparative Connections: A
Triannual E-Journal on East Asian Bilateral Relations, 2.
65
This was confirmed by a US Embassy official who admitted that the State Department’s position
is not to discuss any hypothetical scenarios with regard to the South China Sea dispute. Interview with
a ranking US Embassy official, Manila, 26 April 2013.
66
Sheldon Simon, “US-Southeast Asia Relations: Deep in South China Sea Diplomacy,”
Comparative Connections: A Triannual E-Journal on East Asian Bilateral Relations (September 2011), 5.
67
This was confirmed by a ranking US diplomat who noted that Washington does not want to
trigger a geo-strategic rivalry with China given that the country is a major American economic partner.
Interview with a ranking US Embassy official, Manila, 26 April 2013.
68
Philippine-US Mutual Defense Board/Security Engagement Board Co-Chairman, “2011
Mutual Defense/Board Engagement Board Strategic Guidelines,” (16 August 2011), 1.

24
 The Philippine Balancing Policy

Defense Assets in the Philippines to support MDB and SEB activities while
the AFP develops its own capability for territorial defense; b) increased joint
bilateral maritime security activities in the South China Sea/West Philippine
Sea; c) development of joint-use maritime security support facilities; d)
improved information-sharing between US and Philippine forces; and e)
the conduct of integrated maritime security initiatives involving the US Pacific
Command and the AFP.
Again in January 2012 in Washington, DC, the Philippine-US Bilateral
Security Board tackled the necessity of an expanded but temporary US
military presence in the country.69 A proposal to this effect was formulated
in line with the Obama Administration’s Strategy Guidance, which provides
for a rebalancing of the US force structure and investments to meet persistent
and potential threats in the Asia-Pacific, and the Middle East, and to advance
capabilities for maintaining access and projecting power globally.70 However,
greater US strategic access to the Philippines will surely be opposed by
nationalist personalities and militant left-wing organizations. Furthermore,
closer security ties with the US will limit the Philippines’ maneuverability in
negotiating with China for the amicable settlement of the South China Sea
dispute. It will also adversely affect the vibrant Philippine-China trade
relations as well. The Aquino Administration must muster enough political
capital to weather the anti-American protest at home and the economic fall-
out from China that an expanded US strategic footprint in the Philippines
could generate.

Conclusion
This article shows that a small power’s adoption of a balancing policy toward
a big power stems primarily from domestic politics and not from any systemic
or rational calculation of power relations in the international system. Despite
being the military laggard of Southeast Asia, the Philippines applies a
balancing policy on an emergent and assertive China. Interestingly, this
policy is the offshoot of a domestic development: President Aquino’s
determination to dissociate himself from the policies of his predecessor,
particularly hedging between China and the US that led to a Philippine-China
entente. An opposition figure during the Arroyo administration, President
Aquino has always been critical of former President Arroyo’s policy of tilting
towards China, which generated several high-level cases of shady deals such
as the JMSU and the controversial National Broadband Network (NBN)
Project with the Chinese-owned ZTE. The asymmetrical power relations
__________________
69
Floyd Whaley, “Philippines in Talk to Expand US Military Ties,” The International Herald Tribune
(27 January 2012), 1 and 3.
70
Cheryl Pellerin, “Carter: Strategic Guidance is Compass for 2013,” American Forces Press Service
(13 February 2012), 2, available at http://www.defense.gov/News/NewsArticle.aspx?ID=66705.

25
 Pacific Affairs: Volume 87, No. 1 – March 2014

between the two countries hardly matter in President Aquino’s decision to

adopt a balancing policy on China. This policy manifests in the present
administration’s agenda to shift the AFP’s focus to maritime/territorial
defense; deepen security ties with the US through military assistance and
training; and seek an American security guarantee under the 1951 MDT.
External developments provided opportunities to the Aquino
administration for buttressing its balancing policy toward this emergent East
Asian power. China’s emergence as a naval power and its assertiveness in the
South China Sea necessitates the build-up of the AFP’s territorial defense
posture. Moreover, America’s hedging policy towards China and later, its
policy of strategic pivot to the Asia-Pacific make it incumbent upon the
Obama administration to strengthen its security ties with its ally, and help
modernize the Philippine military.
The Obama administration’s 2012 strategic guidance provides for a
restructuring of the US military and defense budget toward a greater focus
on potential security challenges in the Asia-Pacific. Washington is also
consolidating and updating its five bilateral alliances in East Asia so that they
will remain effective in the face of current changes in the region. This involves
linking those alliances by revitalizing the well-established ones in Northeast
Asia (US-Japan and US-South Korea), and expanding and deepening the
American “security” relationship in Southeast Asia (US-Philippines and US-
Thailand). Washington expressed its commitment to strengthen Manila’s
capability to monitor and defend its maritime territory through an increase
in military exercises and capacity-building efforts. These developments
indicate that the US anticipates a long-term strategic competition with
another technologically advanced military power in the Pacific: China.
The Aquino administration is willing to facilitate the US strategic pivot
to Asia as it expressed its openness to the rotational presence of American
forces in the Philippines. Currently, the Pentagon is implementing a three-
year program to enhance a credible US maritime presence in Philippine
archipelagic water by improving the Philippine port infrastructure, upgrading
equipment, and developing secure communication to allow greater
interoperability between the US military and the AFP, and assisting in
Philippine interagency planning and coordination at the ministerial and
operational levels.
However, the Philippines’ balancing policy is difficult and risky. The
Aquino administration lacks the resources even for a credible territorial
defense capability. Moreover, the Philippines is no match for an affluent and
militarily powerful China. It desperately seeks to clarify the extent of
American security guarantee as provided by the 1951 MDT. The Obama
administration remains supportive at best, but is seemingly non-committal
and wary of triggering a sudden and all-out confrontation with China, the
world’s second-largest economy and one of America’s major trading partners.
Despite the risks, the Aquino administration consistently puts up a brave

26
 The Philippine Balancing Policy

front. This is most evident during the two-month stand-off between the
Philippine and Chinese civilian vessels in the Scarborough Shoal; in President
Aquino’s resolve to acquire ships and jet fighters for the AFP; and recently,
in his gambit to facilitate a broader American strategic footprint on Philippine
territory on a temporary and rotational basis. This resolve, however, must
be coupled with foresight and prudence. If not, the Aquino administration
would realize sooner rather than later the harsh truth of Thucydides’ Melian
Dialogue: “The strong do what they have the power to do and the weak accept
what they have to accept.”71

De La Salle University, Manila, Philippines, August 2012

__________________

71
Thucydides, “Melian Dialogue,” in Classics of International Relations, ed. John A. Vasquez (New
Jersey: Prentice-Hall, 1996), 17.

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