Defense chiefs from the four "Squad" nations. From left, U.S.'s Lloyd Austin, Australia's Richard Marles, Japan's Minoru Kihara and the Philippines' Gilberto Teodoro in Hawaii on May 2. © Kyodo
Amid a steady yet dramatic shift in Philippine foreign policy under President Ferdinand Marcos Jr., the Southeast Asian nation has found itself at a strategic crossroads. Over the past six months, maritime spats in the South China Sea have descended into a perilous phase, culminating in the injury of numerous Philippine servicemen and damage to various Philippine maritime force vessels near contested land features, most notably the Second Thomas Shoal.
The latest incident took place in the Scarborough Shoal, which has been under China’s de facto administrative control following an inconclusive naval stand-off in 2012. Philippine authorities have accused Chinese maritime forces of using water cannons to prevent Philippine patrol near and resupply missions to disputed land features, which fall within Beijing’s ‘nine-dashed-line’ claims in the area.
China insists that the Philippines has provoked the most recent cycle of tensions by violating an alleged informal ‘agreement’ under the previous Rodrigo Duterte administration, which was generally friendly to the Asian superpower. But the Philippines has denied the existence of any such agreement. Angered by recent incidents, the Philippine public has demanded more decisive measures, including a military response and growing cooperation with Western allies.
Accordingly, the Southeast Asian nation has joined a newly-formed Quadrilateral security grouping along with the United States, Australia and Japan, which has been dubbed as the ‘Squad,” to contrast with the better-known “Quad” grouping of India, Australia, Japan and the U.S. The four allied nations aim to intensify their security cooperation, drills, and joint patrols, including in the South China Sea. But the ‘Squad’ also runs the risk of escalating tensions further by accentuating China’s concerns over a U.S.-led ‘containment’ strategy.
Nevertheless, Marcos Jr has reiterated his commitment to a diplomatic solution to the ongoing disputes and has openly ruled out a more aggressive response in the South China Sea that could inflame an already tense situation. After all, the Philippines also realizes that China is a vital neighbor, a potential source of huge investments, and the future of the ‘Squad’ is uncertain, given the fluctuations of regional geopolitics and the prospect of a second Trump administration taking over the White House next year.
Frayed Diplomatic Channels
By all indications, bilateral diplomatic channels between the Philippines and China are under tremendous stress. At the most fundamental level, the two sides have a diametrically opposing understanding of preexisting and confidential agreements on conflict-management over disputes in the South China Sea.
According to the Chinese Embassy in Manila, it had secured "temporary special arrangements" with the Duterte administration as early as 2016 in order to avoid clashes in the South China Sea. In particular, the former Philippine government had allegedly promised not to deploy military assets, including warships and aircrafts, within the 12 nautical miles of the Scarborough Shoal.
The previous Filipino president had allegedly also agreed to keep Filipino fishermen away from the fishing grounds in the area. China has claimed that the Philippines had earlier assented to a ‘gentleman’s agreement’ not to fortify its de facto military base in the Second Thomas Shoal, another contested feature at the heart of bilateral maritime spats and recent near-clashes.
It’s not clear what exact promises the former Filipino president had secured from China, but Duterte had repeatedly boasted about billions of dollars of potential investment from China as well as potential resource-sharing arrangements in the disputed areas.
As previously stated, Philippine authorities, including those from the former Duterte administration, have denied the existence of any such arrangements. But to make matters more complicated, the Philippines has also denied that it had arrived at a ‘new model’ of conflict-management over disputed land features under the Marcos Jr administration.
Amid contradictory statements, some Philippine authorities have threatened to sever communication channels altogether, and Philippine National Defense Secretary Gilbert Teodoro Jr. accused China of concocting imaginary pacts to undermine Manila’s moral position and undercut its growing security cooperation with traditional allies.
Squad and its Limits
The first “Squad” meeting took place last year on the sidelines of the Shangri-La security dialogue in Singapore amid a rapid expansion in Philippine-U.S. defense cooperation. Last month, the four nations conducted their first-ever joint maritime patrols within the Philippines’ exclusive economic zone in the South China Sea, signaling their deepening maritime security cooperation amid rising tensions in the region.
The latest ‘Squad’ meeting took place in Hawaii, where the U.S. Indo-Pacific command is based. During the meeting, U.S. Defense Secretary Lloyd Austin said that the four nations “share a vision for peace, stability and deterrence in the Indo-Pacific” and vowed to collectively “charter an ambitious course to advance that vision together.”
Austin also emphasized the need for “deterrence,” a statement that had particular poignance in light of his criticism of China for being “irresponsible” with its “disregard [for] international law” in the South China Sea. China, however, likely views the new quadrilateral grouping as part of a new U.S.-led containment strategy in Asia.
As one Chinese expert put it, “The U.S. is clearly trying to rally its allies - Japan and Australia - to support the Philippines, encourage the Philippines to engage in more military provocations in the South China Sea, exacerbate the complexity of the regional situation, and then find excuses to strengthen the military presence of the U.S., Japan and Australia in the South China Sea.” He also noted that the risk is that the “involvement of external countries and forces in South China Sea issues will only further complicate the situation in the region, and flaunting their military power will not only affect normal regional cooperation but may also lead to conflicts.”
In fairness, Marcos Jr. has also recognized the need for keeping relations with China even keel. After all, the future of the ‘Squad’ itself is far from assured: Australia’s defense budget and strategic attention is drained by the controversial multi-billion Australia-UK-U.S. (AUKUS) submarine deal; Japan’s static economy will strain its increasingly global defense role; and America is already overstretched across multiple theatres by providing tens of billions of dollars to besieged partners and allies in Europe and the Middle East. Not to mention, a second Trump administration could spell chaos at home and for U.S. allies across the world.
“The last thing we would like is to raise the tensions in the [South China] Sea. That’s the last thing. And that we’ll certainly [not do],” Philippine President Ferdinand Marcos said, when asked about whether his country would adopt aggressive countermeasures against China amid intensifying maritime tensions. The Filipino president seems committed to a diplomatic solution while enhancing his country’s strategic position by drawing on a network of allies and partners across the Indo-Pacific. The Philippines simply sees the ‘Squad’ as a way to create some balance in its relations with China. But it remains to be seen whether the Philippines’ defensive moves will create a new equilibrium or instead unintentionally exacerbate tensions with China, a key trading partner and major neighbor.
