Knives out: That worsening China-Philippines reef spat (2024)

By PHELIM KINE

with PIETER HAECK

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Hi, China Watchers. Today we measure how close Beijing is to triggering the U.S.-Philippines Mutual Defense Treaty, bid farewell to U.S.-China sister city ties in Indiana and examine how a new congressional working group aims to “exert bone crushing leverage” to curb China’s role in the U.S. fentanyl crisis. And we profile a book that argues that China’s challenge in the Indo-Pacific requires (another) “U.S. pivot to Asia.”

Let’s get to it. — Phelim.

Beijing tests U.S. resolve in the South China Sea

The Philippine government is scrambling to find ways to de-escalate a tense standoff with Beijing in the South China Sea without invoking the 73-year old U.S.-Philippines Mutual Defense Treaty, which would require the U.S. to use military force against an attacker.

But as Beijing continues its aggressive harassment of Philippine vessels, they may be getting closer to seeing that as the only option.

“We are really not in the business of instigating any kind of war, we are just trying to protect our territory,” Philippine ambassador to the U.S. Jose Manuel “Babe” del Gallego Romualdez told reporters Wednesday. But he warned that if China doesn’t back off, it risks a U.S.-Philippine response. “This treaty we have is very real in the sense that when it needs to be invoked, it will be,” Romualdez said.

And then the question will become how the U.S. interprets its obligation to defend the Philippines, especially as Washington is already devoting resources to supporting Ukraine’s defense against Russia and tamping down conflict in the Middle East.

Beijing has been making increasingly bellicose incursions into Manila’s waters of the South China Sea harassing resupply missions to the Philippine military outpost Sierra Madre on the Second Thomas Shoal.

“We have tried all sorts of ways to bring down the level of tension but it’s obviously not working, so we feel that perhaps a frank, clear discussion and dialogue with the Chinese is probably the best way to go,” to reduce the risk of more violence, Romualdez said. Manila hopes to hold those talks early next month, he added.

Beijing’s tough talk. China’s incursions defy an International Tribunal of the Law of the Sea ruling against Beijing’s territorial claims in 2016. But Beijing says it’s not going anywhere. Manila should “stop infringing on China’s rights and making provocations, and stop misleading the world,” Chinese Foreign Ministry spokesperson Mao Ning said Monday.

Manila has a red line. Chinese Coast Guard personnel armed with knives, machetes and axes intercepted and rammed one of those resupply convoys last week, resulting in a Filipino sailor losing a finger. Philippine President Ferdinand Marcos warned in April that any incident resulting in the death of a Filipino will trigger the 1951 treaty.

The U.S. has a vague line. The treaty’s criteria for collective defense is an “armed attack” on either the U.S. or the Philippines. The Biden administration refuses to get specific. “We’ve sent a clear and unambiguous message of our determination to stand by our Philippine friends,” Deputy Secretary of State Kurt Campbell said at a Council on Foreign Relations event on Monday in response to a question about what would trigger the treaty.

Bureaucracy before battle. Invoking the treaty will impose a lengthy consideration of possible U.S.-Philippine responses. “It would not by default prompt the U.S. to immediately counter-attack — it would involve deliberations first, then a decision on potential use of force by either side,” said Lyle Morris, former country director for China in the Office of the Secretary of Defense, now a fellow at the Asia Society Policy Institute’s Center for China Analysis.

Biden’s big decision. Those deliberations would climax with a potential plan of action that would go to the Oval Office. President Joe Biden “would have to then weigh all this and say ‘What are our options and what are we really willing to do in this case, either big or small?’ —it’s really a political decision based on the circ*mstances at the moment,” said Isaac Harris, China political military adviser to the Deputy Assistant Secretary of Defense from August 2022 to October 2023 and currently the vice president of government strategy at the supply chain risk management firm Exiger Inc.

Non-treaty options. There are less fraught options for Manila and Washington. U.S. and Philippine naval forces will hold joint exercises “planned for months” to demonstrate joint resolve, said Romualdez.

The Biden administration could impose “economic sanctions complemented by a more severe information campaign to really highlight Chinese aggression,” said Ian Brzezinski, former Deputy Assistant Secretary of Defense for European and NATO Policy from 2001-2005 and currently a fellow at the Atlantic Council.

Hill hawks want action. There’s pressure from Capitol Hill for the Biden administration to do more than just criticize those Chinese incursions. “Determining what would trigger the Mutual Defense Treaty is something that should include both chambers of Congress and the administration, in addition to the Philippines government — now is the time for the Biden administration to begin these conversations,” said Rep. Michael McCaul (R-Texas), chair of the House Foreign Affairs Committee.

Indiana bars sister city ties with China

A new state law that goes into effect on Monday bars cities in Indiana from forging sister-city relationships with municipalities in China. That ban — part of a larger legislative package within Indiana state legislature’s bill 1120 passed in March — prohibits such relationships with “a foreign adversary.”

Those foreign adversaries also include North Korea, Iran and Venezuela, but the state legislator who championed the law made clear it’s all about China.

“There’s so many things that made it unconscionable to me that we would continue these agreements when we know that China isn’t acting in good faith,” said Indiana Rep. Mitch Gore, a Democrat. Gore sees sister-city ties with China as a potential national security risk that municipal governments lack the necessary sophistication to detect and avoid.

Sister city deals are a “soft touch to try to get things out of us — information or other things that perhaps they wouldn’t have gotten otherwise,” Gore said. Beijing’s interest in such ties suggest that they are “beneficial to China, and to the detriment of the United States,” Gore said.

That’s bad news for the Washington-based nonprofit organization Sister Cities International, founded by President Dwight Eisenhower in 1956 to broker such relationships in order to foster links between the U.S. and foreign countries.

“We certainly understand that China and [some] other countries are bad actors … but we try to stay focused on the non-political aspect of these relationships between these countries,” said the group’s chief executive officer, Ricki Garrett. Banning such ties with China only deprives U.S. citizens of “cultural, educational and other kinds of partnerships,” Garrett said.

TRANSLATING WASHINGTON

— BEIJING BARKS BACK AT AMBASSADOR BURNS: China’s Foreign Ministry isn’t happy about U.S. Ambassador Nicholas Burns’ recent brutal candor about the state of U.S.-China relations. Burns blasted what he said were Beijing’s systematic efforts to undermine U.S. diplomatic outreach in China and to fuel anti-American feelings among the Chinese public in an interview with the Wall Street Journal published Tuesday. China’s Foreign Ministry has responded by blaming the U.S. for creating a “chilling effect” on bilateral ties. Burns’ comments “do not reflect the facts…[and] are not conducive to the sound and steady growth of China-U.S. relations,” Mao at the Chinese Foreign Ministry said Wednesday. Among Burns’ complaints — U.S. dissatisfaction with the Chinese police handling of the stabbing of four Iowa college students in the northeastern city of Jilin earlier this month (details dished in this China Watcher).

— CHINA-FOCUSED LAWMAKERS APPLAUD TRAFFICKING REPORT: The co-chairs of the Congressional Executive Commission on China commended the State Department on Tuesday for declaring China is “not making significant efforts” to combat human trafficking. State listed China in its Tier Three category of countries that “do not fully meet the Trafficking Victims Protection Act minimum standards,” in its 2024 Trafficking in Persons Report published Monday. That listing reflects “the pervasive problem of the state-sponsored labor trafficking of Uyghurs, Tibetans and other ethnic minorities…[and] forced organ harvesting targeting ethnic and religious minorities in China,” Rep. Chris Smith (R-N.J.) and Sen. Jeff Merkley (D-Ore.) said in an X post Tuesday. Beijing pushed back. “The so-called report … is deluged with political lies and ideological bias,” said Chinese embassy spokesperson Liu Pengyu.

— CHINESE EMBASSY LASHES THE DALAI LAMA: The Chinese embassy published a statement Tuesday attacking Tibet’s spiritual leader the Dalai Lama — currently in New York for knee surgery — as a “a political exile engaging in anti-China separatist activities under the guise of religion.” That’s a response to what the statement calls a “high profile” meeting between the Dalai Lama and a congressional delegation that included House Foreign Affairs Committee chair Michael McCaul (R-Texas) and former House Speaker Nancy Pelosi (D-Calif.) earlier this month in Dharamsala, India. “My meeting with the Dalai Lama last week clearly rattled [China’s leader] Xi Jinping — he immediately ran to Tibet for a photo op to counter the clear message our visit sent that democracy and freedom of religion will always prevail over oppression and autocracy,” McCaul said in response to China’s statement. Pelosi responded by saying that the Dalai Lama “will live a long time, and his legacy will live forever, but [Xi Jinping] … you’ll be gone and nobody will give you credit for anything.”

Namgyal Choedup, the Washington-based North American representative of the exiled Central Tibetan Administration, said China’s statement “is a clear indication of how insecure PRC is about Tibet … and the fact that it lacks any legitimacy when it comes to its rule over Tibet.”

TRANSLATING EUROPE

— THE HUNGARY-CHINA LOVE FEST GOES ON: Just days before Hungary takes over the presidency of the Council of the EU, and becomes a key player in EU policy making, Budapest and Beijing have once again emphasized their warm ties. Hungarian Foreign Minister Peter Szijjártó had a call with his Chinese counterpart Wang Yi on Tuesday. According to a government spokesperson on X, the Hungarian minister called for “avoiding trade wars” and for “mutually beneficial economic partnerships.” Brussels has recently proposed slapping higher tariffs on Chinese electric vehicles.

Hungary has benefited from a steady influx of Chinese investment in recent years. That puts it into a collision course with Brussels, which has pushed to “de-risk” its ties with, and reduce dependency on China. Read the story by our European colleagues Pieter Haeck, Camille Gijs and Carlo Martuscelli here.

— SPEAKING ABOUT DE-RISKING: The EU has spoken a lot lately about how to de-risk ties with China. A review of trade defense measures and better safeguards against foreign interference is meant to put that into practice.

But a report out this morning from the European Council on Foreign Relations think tank claims that just de-risking “masks the complexity it purports to address.”

Limiting risks comes with trade-offs, and involves parties and powers (like the U.S.), which both undermine the practicality of mere de-risking.

“Focusing solely on risk mitigation, however, is short-sighted and prevents the EU from effectively managing its geoeconomic position at a time when other powers’ ambitions threaten to narrow its room to [maneuver],” the report continues.

HOT FROM THE CHINA WATCHERSPHERE

— REPORT: ‘DE-RISKING’ IS HARMING CHINESE WORKERS: Focus on the potential pitfalls of de-risking of course goes far beyond the EU. Corporate and government moves to de-risk their supply chains from an overreliance on China is costing growing numbers of Chinese export manufacturing workers their jobs, said a joint report released Wednesday by the Netherlands-based Center for Research on Multinational Corporations and the Hong Kong-based worker advocacy organization China Labour Bulletin. De-risking “is changing the role Chinese manufacturing plays in global supply chains … [and] Chinese workers who have kept supply chains running in the apparel and electronics sectors for decades are now struggling to get paid or losing their jobs as orders are cut or factories close or relocate,” the report said.

— CHINA’S PREMIER: DECOUPLING RISKS ‘VICIOUS CYCLE’: China’s Premier Li Qiang has warned developed economies of the global risks of moves to reduce China’s role as the center of global supply chains. Efforts to economically decouple from China “will only raise the economic operating costs of the entire society and the world” and will “drag countries … into a vicious cycle of scrambling for a cake that becomes smaller and smaller,” Li said at the annual meeting of the World Economic Forum in Dalian, China on Tuesday, per CNN. Li’s comments followed a Canadian government announcement on Monday that it was considering following the U.S. and EU in imposing tariffs on Chinese-made electrical vehicles.

THREE MINUTES WITH…

Rep. Jake Auchincloss (D-Mass.) is the co-chair of the House Select China Committee’s new Fentanyl Policy Working Group. China Watcher spoke with Auchincloss about the group’s objectives and where U.S. efforts to curb China’s role in the U.S. opioid overdose epidemic are falling short.

Responses have been edited for length and clarity.

Why isn’t Beijing doing more to address this crisis?

It’s strategic — they’re trying to enervate the United States. It’s 100,000 Americans being poisoned [annually]. The Chinese deeply feel the wounds of opium from the 19th century, which they think of as a century of humiliation predicated on the opium wars and opium addiction. So they literally understand what this drug can do to a society. I do think there’s some sense that it is a liability that they can use as pressure against us. And it’s a negotiating chip for them. There are things that they want. Cracking down on fentanyl exports is something that they would want concessions for.

What are you going to do about that?

Focusing attention and bipartisan support behind pieces of legislation or executive actions that we think would be beneficial. First — sanctions of the actual fentanyl manufacturers — do we have sufficient sanctions authority? Second — do we have sufficient customs enforcement authorities and funding? And third — do we have the tools necessary to crack down on [fentanyl-related] money laundering?

So we’re going to look at existing different pieces of legislation and say “Do we have the authority necessary [to address the problem]?” And is it being used sufficiently aggressively? It’s not just about empowering the administration; it’s also holding the administration to account.

What would make you feel like you’ve had some success by the end of this year?

Producing the tools that any administration would need to exert bone-crushing leverage against the Chinese Communist Party on fentanyl exports. What they would need for Customs [enforcement]. What they need for money laundering. What they need for sanctions against the fentanyl precursor manufacturers.

HEADLINES

The Nation: A New Chinese Exclusion Act

RFA: China’s political refugees remain at risk long after leaving country

Foreign Affairs: America’s Asian partners are not worried enough about Trump

NPR: Inside the Chinese-funded and staffed marijuana farms springing up across the U.S.

HEADLINES

— KISHIDA SEEKS TRILATERAL SUMMIT IN JULY: Japanese Prime Minister Fumio Kishida wants to convene a meeting of the leaders of the US.-Japan-South Korea trilateral on the sidelines of next month’s NATO summit in Washington. Kishida wants to sit down with President Biden and South Korean President Yoon Suk Yeol “to confirm cooperation between Tokyo, Seoul and Washington at a time when North Korea and Russia are stepping up their military cooperation,” Japan’s Jiji Press news agency reported Tuesday, quoting Kishida’s ruling coalition partner Natsuo Yamaguc

ONE BOOK, THREE QUESTIONS

Lost Decade | Oxford University Press

The Book: Lost Decade: The U.S. Pivot to Asia and the Rise of Chinese Power

The Authors: Robert D. Blackwill is Henry A. Kissinger senior fellow at the Council on Foreign Relations; Richard Fontaine is the chief executive of the Center for a New American Security

Responses have been edited for length and clarity.

What is the most important takeaway from your book?

Both the Obama and Trump administrations failed to adequately address the arrival of an aggressive illiberal superpower competitor. The experience of that “lost decade” illustrates why a renewed U.S. pivot to Asia is even more necessary now – and how to do it without abandoning vital national interests and commitments in Europe and the Middle East.

What was the most surprising thing you learned while writing this book?

Just how much China’s ability to threaten America’s vital national interests grew across a critical decade. The PRC sought to fragment America’s Asian alliances, and the regional balance of power has shifted decidedly in Beijing’s direction. China’s growing nuclear arsenal could deter the United States in a crisis. And China worked ceaselessly to alter global values, rules and practices at America’s expense.

There’s a debate in Washington that the U.S. must choose between supporting Ukraine against Russia aggression or deterring Beijing from invading Taiwan. What do the lessons of the “lost decade” say of this choice?

Allowing Putin to overrun Ukraine in the name of deterring aggression in Asia would be strategic folly. Outcomes in the two theaters are inextricably linked. Washington must prioritize the Indo-Pacific, but it possesses everything necessary to compete with Beijing and deter war in Asia, while defending its vital national interests and meeting its most pressing commitments elsewhere.

Got a book to recommend? Tell me about it at [emailprotected]. Thanks to: Heidi Vogt, Camille Gijs, Carlo Martuscelli and digital producers Emma Cordover and Dato Parulava.Do you have tips? Chinese-language stories we might have missed? Would you like to contribute to China Watcher or comment on this week’s items? Email us at [emailprotected] [emailprotected]