The MOU for Philippine participation in the Belt and Road Initiative

Belt and Road Initiative [Source: Wiki; see link in article]

By JoeAm

Below is the Memorandum of Understanding between the Philippines and China regarding joint participation in the Belt and Road Initiative (BRI), formerly known as One Belt One Road (OBOR).

Here are the highlights:

  1. This is China’s initiative to keep growing, postured to share the wealth with participating nations.
  2. Participants will be guided by “mutual respect for territorial integrity and sovereignty” and work in bilateral, regional, and cultural cooperation.
  3. The partners will work together on communications, infrastructure, trade and investment, finance, and cultural cooperation.
  4. Cooperation will involve meetings, research and training, and projects/programs based on free market principles and mutual interests.
  5. Disagreements will be resolved in a friendly way through diplomacy.
  6. The understanding will become effective when both parties have satisfied their own legal requirements. The term will be four years, and there is a three-month advance notice termination process.

There are some extremely important aspects of the agreement to understand:

  1. It is being implemented at China’s interest and discretion. China is the top dog and other participants are going along with the program as compliant partners because they see advantages in working together.
  2. The respect for territories and sovereignty is a guideline, not a hard, legal rule. The bilateral cooperation engagements will most certainly have the Philippines bowing to a partner which has the greater resources, capacity, and authority.
  3. The Philippines goes along with the deal with eyes open. There is a termination provision but the deeper the program goes, the more the Philippines will be obligated to and controlled by China. Financing, skilled workers from China, and project entanglements will bind the Philippines to her commitments. There will be huge economic and social pain upon withdrawal.

The results had better be spectacular because the Philippines is ceding sovereign POWER, if not legal rights, to China. China will become like America during the early part of the 20th Century, imposing her authority on many aspects of Filipino governance, commerce, and lifestyles.


41 Responses to “The MOU for Philippine participation in the Belt and Road Initiative”
  1. andrewlim8 says:

    In a recent UK Parliament discussion on Brexit, one MP referenced the Eagles “Hotel California”:

    Last thing I remember, I was
    Running for the door
    I had to find the passage back to the place I was before
    ‘Relax’ said the night man,
    ‘We are programmed to receive.
    You can check out any time you like,
    But you can never leave!’

    Looks like the arrangements the Philippines will enter into with China will make exit impossible and too damaging.

    By the time all these mistakes become evident, Duterte and his gang of arrogant 70 year olds will be gone and the future generations will be left scratching their heads, poorer and powerless.

  2. karlgarcia says:

    The DOF is insisting and convincing us that it is not a debt trap.
    True every situation is different. We will be so unique and favored that we won’t suffer the same consequences of those trapped because of the carefully crafted MOU which covers all bases supposedly.

    India was or still reluctant because of sovereignty issues.
    The president is not even ashamed of saying that he is afraid of China.

  3. edgar lores says:

    BRI is neocolonialism.

    [nee-oh-kuh-loh-nee-uh-liz-uh m]


    the policy of a strong nation in seeking political and economic hegemony over an independent nation or extended geographical area without necessarily reducing the subordinate nation or area to the legal status of a colony.

  4. Andres 2018. says:

    Before it was Europe, then America, now China.

    Whats next? Aliens from outer space maybe. lol.

    • karlgarcia says:

      If Elon Musks angers the Martians after he colonizes it, prepare for War of the Worlds.
      Maybe that is why Musk says he is only 70 percent decided if he will move there.

  5. I received an e-mail from “Tony” that makes the following assessment and includes two in-depth references. No one can say that Filipinos did not have sufficient information to make a wise decision.

    Experience to date flags a number of potential issues:

    – Mainly use of chinese companies/workers
    – Small local companies pushed out of business
    – Legal complexities/loopholes (? when/where does international law apply. Does it apply at all!)
    – Lack of local worker rights
    – Lack of transparency
    – White elephant projects – poor ROI
    – Difficulty in measuring/assessing project benefits
    – High levels of corruption
    – Technology lock-in
    – Security concerns
    – China becomes dominant in key markets/strategic areas in BRI countries
    – China avoiding multi-lateral agreement – better for china
    – Lack of in country expertise – technical/legal/professional
    – No skills transfer

    Almost establishing a ‘country within a country’ operating to its own standards/rules with insufficient oversight.

    BRI review:

    “Chinese projects are less open to local and international participation. Out of all contractors participating in Chinese-funded projects within the Reconnecting Asia database, 89 percent are Chinese companies, 7.6 percent are local companies (companies headquartered in the same country where the project was taking place), and 3.4 percent are foreign companies (non-Chinese companies from a country other than the one where the project was taking place). In comparison, out of the contractors participating in projects funded by the multilateral development banks, 29 percent are Chinese, 40.8 percent are local, and 30.2 percent are foreign”

    OBOR review:

    • chemrock says:

      To be fair, for all intl projects, it’s important to see where the funding is coming from. If it’s an exim funding, big chunks of hardware software and people ware will come from the funding country. If it’s exim bank of Japan, lots of Japanese components. If its exim bank China, lots of Chinese component.

      Having said that, exim bank loans is normally somewhat soft loans as the funding country objective is to export their stuff so there is a bit of subsidy or tax advantage computed in there. However, these Chinese exim bank loans come at very high interest rates. So there is no subsidy and creditors lock themselves into all things Chinese for the project. Dumb.

      • It is dumb. The quoted except says that the One Belt One Idiot initiative has 89% Chinese companies whereas projects funded by other international agencies have 29% Chinese participation. The point in my article is correct, and as Edgar has characterized it, this is one step short of colonization.

        • chemrock says:

          But it is colonization with a difference. The locals can exercise Free Will. The conquistadors and western colonizers of the past offered no free will.

          • Yes, but free will in the Philippines is bound to self gratification, so China knows she can pay for services rendered. The country is captured, one way or another, and no need to spend for armies here.

            • This is Management 101.

              Either you manage directly, or indirectly.

              Both have been done through out history, which works which doesn’t I have no idea.

              When the Spartans and Athenians fought, it was Athens who had an empire— devolved from ideal of democracy to might makes right. Spartans dealt with their slaves and folks they ruled directly, but was more indirect with their influence with other city-states.

              Eventually all city-states fell to Macedonians, under King Philip all Greeks experienced direct rule. His son, Alexander the Great, was more a direct, hands-on kinda guy too, until he defeated Persia and took on their system,

              which was more indirect than what the Greeks/Macedonians were used to.

              essentially the Persians conquered and just sat back, indirectly just taking in taxes and gifts from their subjects, keep your language and culture so long as you pay the piper.

              I’m sure Alexander the Great would’ve eventually gone more direct, or maybe not, his dream was to keep on going eastward no time to manage, which I guess makes him de facto indirect type of ruler.

              Rome was direct, only acknowledged two languages Latin and Greek, only respected two cultures, Latin & Greek, everyone else under them had to shed their language and culture to fit in.

              So the best examples of direct and indirect, are Rome and Persia.

              Britain went from direct to indirect, but back to direct with India, eventually they lost heart, empire building is easy, empire management now that’s a lot trickier.

              if there’s anything we learnt from 3 centuries of European colonial enterprise , it’s that the juice isn’t necessarily worth squeeze, and I think China having read up on what European nations did, with America as the last example, and our ‘Human rights for everyone’ battle cry,

              China just wants to do what ancient Persia did in the past, sit back and watch the riches roll in. Less hassle this way. It helps too that all poor nations are running towards China like lemmings in heat.

              Regardless, America will still be on top. Why? Because we have Indians.

              • Micha says:

                And I thought it’s just AT&T who’s doing the outsourcing to India.

              • chemrock says:

                In Singapore or govt has a Comprehensive Economic Cooperation Agreement (Ceca) with India. This more or less allows for greater labour and capital mobility between the 2 countries. India is not exactly a favoured investment destination for Singaporeans, and the few who went there found great hurdles because India is not a very open to foreign investments. On the other hand, hordes of Indian companies came into Singapore, but no jobs for the locals because they bring in so-called Indian talents, including the receptionists.

                I returned to Spore and faced a cultural shock. The landscape has totally changed. Catching the MRT from the airport out it was shocking to see 3/5 ths pf pax were Indians, and I don’t mean our local Indians. Our grocery stalls now play Indian music.

                Needless to say, this gonna hurt the ruling party politically. As a multicultural country, I don’t think we are racists. But the CECA has been seen very negatively because there are no job creation. The guys who are happy are the elites who have houses to rent out, and business owners who now have more customers. The ordinary guys are left with their spaces taken up by foreigners, literary. People are pissed off, but the anger is directed at the govt and not the INdians.

              • Sounds like Singapore seeks to emulate the Philippines and Cayetano may end up correct in 30 years.

              • NHerrera says:

                Chempo, similar experience I had with demographic change. I was a student in Stanford, California in the early 60s and had not been back to that State till 1991 as tourists, then with my wife and two daughters. I was surprised to see a lot of Latinos (Mexicans) in the place and hearing Spanish spoken — Filipinos ears as you most probably know are comfortable with hearing that language.

                [Of course, if we believe evolution and scientists, humans came from what we now call Africa. Then the continents and land masses, so we are told, are not what we have now. Those humanoids probably had different colors, or if they were dark, on reaching the parts we now know as Europe, adapted with the climate through evolution. But I digress.]

              • chemp,

                I see how that could off-set the balance in Singapore , you got Chinese, Malays & Indians , if one supersedes the others, something like Lebanon happens.

                When I was there I was told that those multi-story apartments/condos had quotas, ie. certain number of this ethnicity, certain number of this age and that, and a certain number of religions must be represented. It feels like Singapore is always playing social engineering.

                Here, I’m sure the Indian influx will be welcomed than fought against. They come here educated, with skills and money, their progeny become doctors, lawyers, businessmen, etc. it’s a seamless transition to American culture.

                I’m sure you’ve by now already read about the Central American caravan, refugees and asylum seekers, was no problem absorbing them after WWII, but these days just not conducive anymore. Too many Americans in poverty, more poor people coming in seems not the answer.

                Sure one can argue potential, but if you have immigrants already educated with skills and moneyed, give them priority. It’s unfair that they get to stroll right in, while Indians of similar caliber can’t even get a visa appointment back in India.

                But going back to the point of indirect rule and to Micha’s comment , no we are not outsourcing to Indians, we are subsuming Indians. Because in the end, this China vs. US fight , more like a race now really, it’s about who can absorb most those with talent, education and money—

                these are the indirect, intangibles. The stuff of edgar’s “neo-colonialism”.

                p.s. — NH, if you visit again now you’ll see more Indians, both fresh of the boat and Indian-Americans over there. Spanish speakers thanks to gentrification are either down south of the 101 or in the I-5 corridor.

            • Beat this , China! 😉

  6. MOU, is that pronounced with rising tone, flat or downward tone? That can change meaning.

    Is it like an MU groovy kind of love relationship?

    • karlgarcia says:

      Mag-un na China and PH

      This mutual understanding expires when Duterte steps down.
      So can the next president void it just like that? We are already stuck with in the quicksand when that time comes.

    • NHerrera says:

      It may be too early to change the tenor of the comments, but probably not because of the line in that song, “A Groovy Kind of Love.”


      When I’m feeling blue
      All I have to do
      Is take a look at you
      And then I’m not so blue
      When I’m in your arms
      Nothing seems to matter
      If the whole world could shatter
      I don’t care

      Wouldn’t you agree
      Baby you and me
      We got a groovy kind of love
      We got a groovy kind of love

      The bolded part seems appropriate for our times.

      Irineo, I just want to let you know that This Octogenarian is still young at heart. 🙂

  7. Gemino H. Abad says:

    China is a deceitful bully. Period. She does not respect any law (say, “international law,” the UN) except her own. Her goal is simply Empire, the Communist Party the Emperor.

    • Yes, that is clear. I see states like Malaysia, Australia, and Viet Nam keeping their own independent authority under this overbearing presence, but the Duterte government seems like it is already sold out.

  8. NHerrera says:

    Two things come to mind:

    2. ADAPT, ADAPT.

    There are many more out there with their variations. If I have to take the second of my list, we should do so with the intelligence and insight such as displayed here in TSH. But one may say, fat chance of that happening. Not my day today. Oh well, tomorrow is another day.

    Nice and very timely read: blog article and comments. Thanks.

    • You’re welcome. Duterte is getting hammered regularly these days. He is being criticized for not choosing the most senior SC justice as the Chief Justice. Three of his cops were declared guilty of killing a teenager, and if he pardons them, as he intimated he would, he will get more grief than ever on any issue. Then to make matters worse, a businessman was shot in Subic, and he is known to several senators, who are now angry about the killings. It had to touch them personally, I guess, as their principles don’t extend past the front of their noses.

      • Grace Reyes says:

        Words cannot describe my sorrow and anger when treacherous assassins snuffed out the life of a promising business leader. Dom and I belonged to the same high school batch and fellow Isko. He was one of the best achievers of our batch. Despite his recent rise to success, he remained humble.
        I blame the lunatic in the palace for spewing vile hate and death narratives. Unknown to him, criminal minds heeded his call to form death squads. The culture of impunity has come knocking on the doors of the well-heeled. Dom’s death should not become mere statistics like thousands of others. He left behind his wife who is also my classmate and fellow Iska and four children. #justiceforDom

  9. Micha says:

    The BRI and the influence and power it seeks to project is too ambitious for comfort. The aggressive expansion cannot succeed without forcing a confrontation with the west.

    While the economic strength of the US has frayed and will continue to wear thin if the fools at the top won’t ever get satiated with their looting, its military might and arsenal is still without equal.

    It’s just tariff war for now, who knows what will come next.

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