The Philippines and Taiwan: Partners for a Stable and Prosperous Indo-Pacific Region?

The Philippines and Taiwan: Partners for a Stable and Prosperous Indo-Pacific Region?

The Philippines and Taiwan: Partners for a Stable and Prosperous Indo-Pacific Region?

Since assuming power in 2016, the administration of Philippine President Rodrigo Duterte pursued rapprochement with China that is reshaping public perceptions of the Philippines’ interpretation of the “One-China” policy. As the Philippines’ foreign policy pivoted towards the People’s Republic of China (PRC), the Duterte administration’s seemingly hardline endorsement of Beijing’s policy has had political ramifications for Taiwan’s diplomatic status in the international community. In September 2017, Duterte also openly singled out criminal syndicates based in Taiwan as suppliers of illegal drugs flowing into the Philippines, while leaving out other major traders, such as China.

Such recent development of political relations between Manila and Taipei may have influenced Taiwanese perceptions of Filipinos. According to a public opinion survey conducted by the Taiwan Public Opinion Foundation in June 2018, the Philippines is Taiwan’s second “most hated” country. Of the 1,703 respondents, the Philippines came second with 52.9 percent of the responses, after North Korea with 70.9 percent, while China rounded up the top three with 43.9 percent. The Manila Economic and Cultural Office was shocked by the survey results as over 150,000 overseas Filipinos live and work in Taiwan.

Contrary to the survey’s findings, the reality regarding Taiwan’s vox populi paints a different picture. An assessment of the achievements and prospects in the cordial relation between Taiwan and the Philippines over the years reveals ever closer cooperation between the two governments. Despite Duterte’s pro-China overtures, the Philippines and Taiwan continue to achieve mutual and shared interests in key areas—trade and investment, people-to-people links, and regional security cooperation—albeit, in a discreet fashion.

Economic Cooperation

According to the Philippines’ Statistic Authority, Taiwan was the second largest source of foreign direct investment (FDI) to the country in 2017 amounting to US$225 million or 10.3 percent  of the country’s total FDI. Conversely, Taiwan’s Bureau of Foreign Trade confirmed that the Philippines was the 11th largest trading partner of Taiwan in 2018 amounting to US$11.4 billion. The economic partnership continued to flourish in the last quarter of 2018 as Taiwan and the Philippines signed six memorandums of understanding (MOU) to further boost investments in the electronics, electric motorbikes, and plastic industries. And just recently, both countries established the Taiwan-Philippines Digital Corridor to leverage on the emerging digital economy. Through blockchain technology, this new venture seeks to connect Taipei, Kaohsiung, Cagayan, and Manila.

The improving economic relations between the Philippines and Taiwan may be largely credited to the bilateral trade agreement signed in 2017. Yet the significance of the agreement was beyond economic gains as it represented a political victory for Taiwan, especially considering its ongoing diplomatic challenges in regional and international politics. Currently, Taiwan is down to 17 formal diplomatic relations from 22, after five countries—El Salvador, the Dominican Republic, Burkina Faso, São Tomé, and Panama—switched their diplomatic recognition to Beijing in recent years. To alleviate its further diplomatic isolation, the Tsai government launched the New Southbound Policy (NSP) in 2016. The NSP seeks to boost Taiwan’s position in regional affairs by envisioning an economic community, driven by people-to-people linkages that involve ASEAN member states, plus Australia, New Zealand, and India. Thus, in this context, the signed investment agreement between the Philippines and Taiwan was considered a key milestone that raised Taiwan’s profile in the international community.

The Philippines can be the potential gateway for Taiwan to deepen its regional engagement, particularly in ASEAN. The revised trade agreement between the two provides a model on how to pursue similar agreements among NSP target countries. Furthermore, this notable progress in the Philippines-Taiwan bilateral relations strikes at the heart of the NSP that aims to assuage Taiwan’s overreliance from China. The Tsai government remains optimistic that economic partnerships will surge as the trade war between the US and China continues to drive the outflow of Taiwanese investments away from the PRC.

People-to-People Connections

The introduction of the NSP also provided more opportunities and avenues to upgrade existing people-to-people connections. Traditionally, the Philippines has been an important source of labor migrants in Taiwan across various sectors, but this reality is changing. In the past three years, Filipino students and professionals have been participating in various educational and cultural mobility exchanges. In 2018, NSP target countries—including the Philippines—accounted for more than one-third of international students in Taiwan. Conversely, in 2017, NSP target countries overtook China’s lead as the largest source of international students studying in Taiwan. Data showed that out of 117,970 students, 35,460 were from ASEAN member states. For 2019, the Taipei Economic and Cultural Office in Manila confirmed the increased scholarship funding available for Filipinos who are interested to pursue undergraduate and master’s degrees or enroll in Mandarin language programs in Taiwan.

Friends, Partners, and Allies

In addition to positive economic ties and growing people-to-people connections, another fundamental element that binds Taiwan and the Philippines is their respective relationships with the United States. With the introduction of the Trump administration’s Free and Open Indo-Pacific (FOIP) strategy aiming to transform regional US allies and partners into a coalition of like-minded states based on shared values and interests, the unique roles of the Philippines and Taiwan should not be understated.

Taiwan and the Philippines belong to the geostrategically important first island chain that controls access to sea lines of communications or common domains from the Pacific and Indian Oceans. As central components of the island chain, both countries are crucial in implementing the maritime strategy of the US FOIP to prevent China’s unilateral and possible preeminent control of the South China Sea.

As a long-standing treaty ally of the United States in the region, the Philippines’ security partnerships with the United States continues to anchor and guarantee American presence and engagement in Southeast Asia. Despite Duterte’s personal leanings towards China, the US-Philippines strategic cooperation remains robust with regular joint-military exercises and training, maritime domain awareness initiatives, and on-going modernization of the Armed Forces of the Philippines. Recently, the United States has also confirmed its commitment to defend the Philippines in the case of an attack in the South China Sea.

Meanwhile, Taiwan complements the US FOIP strategy through its New Southbound Policy. The NSP contributes to the US FOIP’s vision of regional prosperity and sustainable growth by expanding transparent and equitable trade cooperation in agriculture, healthcare, and technology. Taiwan’s thriving economy and civil society is also a testament to its flourishing democracy and adherence to the rule of law.  

Moving Forward: Increasing Collaboration and Understanding

The growing relations between Taiwan and the Philippines is very positive, yet far from perfect, hence, missteps and inevitable gaffes persist.

Last month, news reports regarding Filipino students being subjected to inhumane labor conditions and verbal abuse under a work/study program in Taiwan surfaced. The issue was consistent with similar cases previously filed by Sri Lankan and Indonesian students. A few weeks after, Kaohsiung City Mayor Han Kuo-yu faced an intense public uproar following his derogatory remarks that discriminated Filipino migrant workers.

As the number of Filipino migrant workers and students who seek employment, exchanges, and training in Taiwan increases, it is imperative that  the governments in Manila and Taipei as well as their respective institutions and organizations strengthen rules, policies, and laws that best protect and uphold the interests and values of the citizens of both countries.

To address issues relating to student mobility and exchanges, the Talent Development Strategy working group under Taiwan’s Ministry of Education (MOE) should reinforce monitoring mechanisms to protect and promote the safety and learning equity of foreign students. Likewise, Philippine-based universities and consortium partners are recommended to work in close association with Taiwan’s MOE for feedback and evaluation of student’s progress and wellbeing throughout the program period.

Meanwhile, to deepen cultural understanding among Taiwanese and Filipinos, MOE and MECO are conducting training and workshops to develop modules that include the Filipino language in the new curriculum of Taiwanese students for 2019. Joint-initiatives like these must be further amplified to gain public attention and support. This does not only dispel deep-seated racial stereotypes but also allows for better understanding of each other’s cultures.  

Confronting the China Challenge

As the Philippines and Taiwan continue to grapple with the uncertainty brought by an increasingly aggressive China, both countries are advised to explore concrete steps to align strategic objectives and initiatives within the US FOIP framework. A Track 2 dialogue involving key think tanks and academic institutions from both countries is recommended to pin down specific areas of convergence and cooperation. The overall goal of such exchange must focus on how small but pivotal states like Taiwan and the Philippines can exert influence and shape their external environment to their advantage, in the face of escalating geopolitical competition.

There is very little reason for the Philippines and Taiwan to “hate” each other. The complementarity of economic and strategic interests as well as the strong people-to-people linkages between the two countries, amidst minor divergence in political proclivities, necessitate greater efforts on both sides to improve public perceptions. Despite the lack of formal diplomatic relations, the bond is solidified by a shared belief in democracy, freedom of speech, human rights, and the rule of law. Hence, it depicts a mutually beneficial partnership—not hindered by strategic distrust but supported by concrete results and actual opportunities—a reality that is hard to keep under the radar.

The main point: The relationship between the Philippines and Taiwan is far from perfect. Amidst Duterte’s pro-China attitude, closer scrutiny reveals that there is more to love than to hate. A growing list of bilateral milestones has been achieved—trade agreements, people to people links, and regional security cooperation—albeit, under discreet fashion.