Philippine president Rodrigo Duterte’s first year in office was a strategic roller coaster. Throughout the year, he tirelessly sought to reorient his country’s foreign policy away from its traditional allies in favor of China and Russia. As Duterte bluntly put it, he sought an “independent” foreign policy, which “will not be dependent on the United States”.

Despite facing domestic resistance from civil society and the defense establishment, Duterte forged ahead fortifying bilateral relations with China, with particular focus on infrastructure investments in his home island of Mindanao. While lashing out at Washington, mainly in response to disagreements over his brutal war on drugs, Duterte has gone the extra mile to praise Beijing, which has offered large-scale economic benefits in exchange for the Philippines’ acquiescence in the South China Sea.

Duterte also pursued tighter defense ties with China, while scaling back its joint military exercises with America and nixing war games as well as plans for joint patrols in the South China Sea. Through he has made 21 trips overseas, including two to China, Duterte has so far deliberately snubbed Washington and other major Western capitals.

The specter of an Islamic State (IS) province in Mindanao, however, forced Manila to return to its traditional allies. The Pentagon has provided assistance to the Philippine military against IS-affiliated fighters, who continue to hold Marawi, the country’s largest Muslim-majority city, in a siege that now stretches into its third month.

Yet, as the 2017 chairman of the Association of Southeast Asian Nations (ASEAN), Duterte has soft-pedaled on the South China Sea disputes in an effort to please China. The upshot is the regional body’s fast slide into irrelevance in shaping the regional security architecture.

Toeing China’s Line

Since coming to power, the Filipino president has repeatedly refused to raise his country’s landmark arbitration case, which nullified the bulk of China’s expansive claims in adjacent waters. To the chagrin of officials at home and across Southeast Asia, he even leveraged his ASEAN chairmanship to shield Beijing against any criticism over its maritime assertiveness in adjacent waters.

During the ASEAN summit (April) and ministerial meetings (August) in Manila, Vietnam vigorously lobbied for the joint communiqué to include, even indirectly, mention of China’s massive reclamation activities and militarization of artificial land features in the South China Sea. Other regional states such as Brunei and Malaysia were reportedly supportive of Vietnam’s position.

In April, Duterte, however, vetoed any mention of the activities in his chairman statement. Even the term “serious concern”, which has regularly appeared in recent ASEAN statements, was omitted. During the difficult negotiations over the final statement, a visibly despondent ASEAN diplomat told the Filipino media how some countries “are frustrated over the turn of events,” and that “your president [Duterte] has [unilaterally] defined the outcome…already.”

A senior Filipino official even lamented how the Philippines was now “being lumped together with Cambodia and Laos in protecting Chinese interests (in ASEAN) at all costs.”

During the ASEAN ministerial meetings in August, Hanoi even more aggressively pushed for a tough statement on China’s reclamation activities and deployment of military assets to artificially-build islands. It also advocated for a “legally binding” code of conduct to be mentioned in the regional body’s joint statements.

After intensive discussions which led to the delay of the communiqué’s,, the ASEAN chairman tried to strike a compromise. The final communiqué says that ASEAN “took note of the concerns expressed by some Ministers” on the reclamation and militarization issue, but clearly implied that this was not a consensus position, with countries such as Cambodia vehemently opposing any tough statement against China.

There was, however, no mention of the Philippines’ landmark arbitration award at The Hague against China, nor a “legally binding” Code of Conduct. The word “serious concern” vis-à-vis the maritime disputes, which repeatedly appeared in ASEAN statements in previous years, was also absent in the August communiqué.

Follow the Money

Crucially, ASEAN called on not only claimant states but also “all other states” to exercise self-restraint in the South China. This was perfectly in tune with China’s call in recent weeks for “external powers”, namely the United States and key allies Japan and Australia, to keep out of the disputes and not “stir trouble”.

In effect, the ASEAN communiqué could be interpreted as a subtle criticism or discouragement of the U.S. Navy’s Freedom of Navigation Operations (FONOPS) in the South China Sea, not to mention plans by other external powers, from Japan to India and Britain, to conduct joint exercises and FONOP operations in the disputed waters.

What stands at the heart of the Philippines’ (and other ASEAN members) soft-pedaling on the South China Sea issue, however, is economics. The Philippine government recently launched the “Dutertenomics” initiative, under which the country is expected to spend as much as $167 billion over the next five years to build new roads, railways, and ports across the country, including Mindanao, which suffers from chronic underinvestment.

Cognizant of Duterte’s developmental ambitious, China has pledged large-scale financial and technical assistance. So far, as many as 12 big-ticket projects worth a total of $4.4 billion, are expected to be fully funded and implemented by Beijing, which is eager expand its economic footprint in one of America’s closest allies in the region. In response, Duterte has consistently portrayed China as a partner for national development and a brotherly nation.

In contrast, the Trump administration, inwardly focused and hobbled by domestic political scandals, has yet to put forward any major economic initiative, and has repeatedly tussled with ASEAN members over climate change and free trade issues. In the eyes of a growing number of regional states, America’s ability to exercise leadership in Asia has dramatically declined in recent months. Under Duterte’s and Trump’s watch, the region is lurching towards a Pax Sinica.

About Richard Javad Heydarian

Richard Javad Heydarian is an assistant professor in political science at De La Salle University, and a policy adviser at the Philippine House of Representatives (2009-2015). He is the author of Asia’s New Battlefield: The US, China, and the Struggle for Western Pacific.