Philippines says US “has lost”, bids it “goodbye”

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From the ABC:

Philippine President Rodrigo Duterte announced his “separation” from the United States on Thursday, declaring he had realigned with China as the two agreed to resolve their South China Sea dispute through talks.

Duterte made his comments in Beijing, where he is visiting with at least 200 business people to pave the way for what he calls a new commercial alliance as relations with longtime ally Washington deteriorate.

“In this venue, your honors, in this venue, I announce my separation from the United States,” Duterte told Chinese and Philippine business people, to applause, at a forum in the Great Hall of the People attended by Chinese Vice Premier Zhang Gaoli.

“Both in military, not maybe social, but economics also. America has lost.”

Duterte’s efforts to engage China, months after a tribunal in the Hague ruled that Beijing did not have historic rights to the South China Sea in a case brought by the previous administration in Manila, marks a reversal in foreign policy since the 71-year-old former mayor took office on June 30.

His trade secretary, Ramon Lopez, said $13.5 billion in deals would be signed during the China trip.

“I’ve realigned myself in your ideological flow and maybe I will also go to Russia to talk to (President Vladimir) Putin and tell him that there are three of us against the world – China, Philippines and Russia. It’s the only way,” Duterte told his Beijing audience.

Duterte’s remarks will prompt fresh concern in the United States, where the Obama administration has seen Manila as an important ally in its “rebalance” of resources to Asia in the face of a rising China.

The administration agreed a deal with Duterte’s predecessor granting U.S. forces rotational access to bases in the Philippines and further doubts will be raised about the future of this arrangement.

In Washington, the U.S. State Department said it was “baffled” by Duterte’s comments and would seek an explanation when Daniel Russel, the top U.S. diplomat for East Asian and Pacific Affairs, visits Manila this weekend.

“We are going to be seeking an explanation of exactly what the president meant when he talked about separation from the U.S.,” said State Department spokesman John Kirby. “It’s not clear to us exactly what that means in all its ramifications.”

What it means is that Chinese economic imperialism is a genuine rival to that of the US. Australia should take note and prevent Chinese influence from expanding any further into our own policy-making by:

  • banning foreign political donations (where’s that gone?);
  • reducing immigration and reining the “citizenship exports” sector;
  • policing foreign buying of property properly;
  • allowing raw materials investment but curtailing it elsewhere, and
  • re-engaging the US in the region.
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It’s that or it’s follow the Philippines into Chinese client-statehood in under a decade.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.