By Richard Javad Heydarian
Manila faces a tough balancing act.
Earlier this year, China was painfully isolated during the Shangri-La Dialogue, Asia’s premier security forum, when it came under criticism from across all quarters for its expansive reclamation activities across disputed features in the South China Sea. Recent weeks, however, have been kind to China.
China formally launched the Asian Infrastructure Investment Bank (AIIB), a promising rival to the Bretton Woods institutions of the World Bank and its regional derivative the Japanese-dominated Asian Development Bank (ADB). China’s national legislature also approved another major Chinese-backed global financial institution, the New Development Bank (NDB). On paper, the NDB symbolizes the emergence of the BRICS as active shapers of the international economic order. In reality, however, it will depend largely on Chinese contributions ($41 billion), which represents 39 percent of total shares.
China’s ultimate economic initiative will be the “One Belt, One Road” project, which will place Beijing at the heart of infrastructure development across the Eurasian landmass while connecting a wide network of ports from the Pacific to the Mediterranean waters. These ambitious efforts fall under Xi Jinping’s “Peripheral Diplomacy” doctrine, aimed at wooing China’s immediate neighborhood, reviving ties with estranged maritime neighbors, and transforming China into the pillar of the Asian economic order.
Unsurprisingly, some neighboring states, particularly the Philippines, have come to view the AIIB and other Beijing initiatives as a disguised effort to create a Chinese ‘zone of deference’ across Asia. Amid an intensifying dispute in the South China Sea, Manila has shunned robust economic and diplomatic linkages with Beijing, depriving itself of much-needed capital and investments.
Read the full story at The Diplomat