Members of the Philippine Coast Guard stand alert as a Chinese Coast Guard vessel blocks their way to a resupply mission at Second Thomas Shoal in the South China Sea, March 5, 2024. REUTERS\/Adrian Portugal\/File Photo<\/p>\n
China Flexes Energy Leverage As the Philippines, US Start Annual War Games<\/p>\n
BEIJING, April 21 (Reuters)\u00a0\u2013\u00a0China on Tuesday implied energy assistance for the Philippines could be tied to Manila holding military drills with the U.S. and other allies, as its top newspaper showed Beijing\u2019s readiness to leverage its reserves in diplomatic disputes.<\/p>\n
In an editorial headlined \u201cThe Philippines should create conditions for deepening cooperation,\u201d the ruling Communist Party\u2019s official People\u2019s Daily accused the Philippines of hypocrisy for seeking the emergency supplies days before hosting<\/p>\n
involving more than 17,000 troops on a remote Philippine island near Taiwan.<\/p>\n
China has the world\u2019s largest strategic oil inventories.<\/p>\n
\u201cThese blatantly contradictory words and deeds expose the opportunistic nature of Philippine politicians,\u201d the commentary said, published under the pen name \u201cZhong Sheng,\u201d meaning \u201cVoice of China\u201d, and commonly used to convey top officials\u2019 views on foreign policy.<\/p>\n
\u201cHow can (the Philippines) justify acting with complete disregard for the interests of its neighbours and yet expect them to come to its aid in a critical moment?\u201d, the commentary continued, calling on Manila to \u201ccreate the right conditions\u201d for improved two-way ties.<\/p>\n
Tying energy relief to diplomatic disputes suggests Beijing could start to use supply assistance as leverage against nations that have displeased it, analysts say, as it has with critical minerals exports to<\/p>\n
Relations between China and the Philippines have deteriorated over the two countries\u2019 competing claims in the South China Sea, particularly over Second Thomas Shoal where Manila grounded a warship in 1999 and conducts regular supply missions to sailors stationed on board. The shoal lies within the Philippines\u2019 200-nautical-mile exclusive economic zone and ?about 1,300 ?km (808 miles) off mainland China.<\/p>\n
China \u2013 the world\u2019s second-largest fertiliser exporter and a major fuel supplier in Asia \u2013 has<\/p>\n
of refined fuels to neighbouring countries, following reports in March that it had<\/p>\n
on fuel exports to prioritise its domestic supply.<\/p>\n
\u201cI saw hints of an implied quid pro quo but not a direct conditionality of energy aid for political pre-conditions. What I saw more was the critique of the Philippines being ungrateful,\u201d said Eric Olander, co-founder of the China-Global South Project.\u00a0\u201cIt wants to rely on China for economic \u2019emergency relief\u2019 while also stirring up trouble.\u201d<\/p>\n
Chinese officials last month offered Taiwan what they described as<\/p>\n
in exchange for accepting Beijing\u2019s rule.<\/p>\n
CHINA\u2019S COMPARATIVE ENERGY ADVANTAGE<\/p>\n
People\u2019s Daily highlighted China\u2019s decision to honour fertiliser contracts with the Philippines despite the March export ban and pointed to Manila\u2019s parallel interest in starting talks on oil and gas supplies. But it went on to list a series of grievances, including the war games.<\/p>\n
Running until May 8, the exercises known as \u201cBalikatan\u201d or \u201cshoulder-to-shoulder\u201d, also include Australia, Canada, France and New Zealand. Maritime strike drills will take place on the island of Itbayat, the northernmost point ?of the Philippines about 155 ?km from democratically governed Taiwan, which China views as its own territory. Counter?landing live?fire drills will take place in Zambales province on the South China Sea, about 230 km from the hotly contested<\/p>\n
, which China controls.<\/p>\n
Ruby Osman, a senior policy adviser at the Tony Blair Institute, said the energy shocks had vindicated China\u2019s early?2000s strategy of stockpiling and reinforced its ability to resist U.S. pressure, encouraging Beijing to act more confidently in situations involving its geopolitical rival.<\/p>\n
But China\u2019s comparative energy advantage should not be confused with the overall health of the country\u2019s energy security, she warned. \u201cChina is still burning through strategic reserves they\u2019d rather not have to, with limited say in the length and scale of the disruption.\u201d<\/p>\n
Chinese President Xi Jinping publicly called for the reopening of the Strait of\u00a0Hormuz\u00a0for the first time during a<\/p>\n
with Saudi Arabia\u2019s Crown Prince Mohammed bin Salman, underlining the unease within the $19 trillion economy\u00a0over the closure of the Strait of\u00a0Hormuz, as export-led growth relies on open sea lanes.<\/p>\n