China, Japan, Korea, Russia compete for $2 Billion Nuclear Plant, LNG Philippines Gas project

Russia Floating Nuclear Power Plant Technology. illustration: popsci.com

China, Japan compete for $2bn Philippine gas project

China and Japan are competing for a $2-billion liquefied natural gas (LNG) project in the Philippines, Energy Secretary Alfonso Cusi told the Nikkei Asian Review.

Over 20 companies from eight countries have proposed partnerships with state-owned Philippine National Oil Corp. for an LNG receiving terminal at the southern part of Luzon Island. Cusi said his team is still reviewing funding and technology options.

"We are talking to China [and] Japan," he said. "We are looking at which can offer the best in terms of funding. It's too early to say who is more advanced -- there are so many things to look into."

Countries that offer the best financing options usually pick their own domestic contractors. Cusi said Tokyo Gas, Osaka Gas, and a number of Chinese state-owned and private companies have shown interest.

Cusi is vice chairman of President Rodrigo Duterte's PDP-Laban party. He has traveled to Beijing and Tokyo this year to solicit energy investments for the Philippines, which runs into alerts and price spikes for electricity whenever the country's lone LNG facility undergoes maintenance.

Cusi said he plans to travel to South Korea and Russia, and does not favor any particular power-generating technology. He said Malampaya, the only source of natural gas in the Philippines, is expected to be exhausted by 2024. The gas field operated by a consortium led by Royal Dutch Shell provides 40-45% of Luzon island's power requirements. Luzon accounts for two-thirds of gross domestic product in the Philippines.

The proposed terminal could import LNG from other countries while alternate Philippine resources are being developed. These include gas fields in the South China Sea in dispute with China. The terminal's plant will initially generate around 200 megawatts, but can expand to 800MW. Cusi hopes to find an investor this year.

Duterte is targeting total household electrification before he leaves office in 2022. As of December, over 90% of households had access to energy. Cusi also said he is studying the possibility of activating a $2 billion nuclear power plant on the Bataan peninsula. The project, initiated under President Ferdinand Marcos in the 1970s but never activated, is located near an earthquake fault line.

Sulu Province of Southern Philippines could have the first ever operating 100 MW Nuclear Power Plant this year according to the report (see here) - Nikkei Asian Review

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Seven Japanese trading houses investing $3.9b in Philippines

Sumitomo Farming Technology

Seven major Japanese trading houses are looking at investing up to $3.9 billion (₱198.5 billion) in different industries in the Philippines.

After his recent trip to Tokyo, Department of Trade and Industry (DTI) secretary Ramon Lopez disclosed on Monday (March 13) that the Japanese companies who made the commitment (to invest in the country) were Mitsubishi Corp, Mitsui and Co Ltd, Sumitomo Corp, Itochu Corp, Marubeni Corp, Toyota Tsusho, and Sojitz.

Others present in the dialogue were Transportation Secretary Arthur Tugade, and Philippine ambassador-designate Jose Laurel — who got together with representatives of Japanese companies with a broad range of business activities.

Lopez noted Marubeni is willing to invest in additional coal power plants worth ₱75 billion over the medium term; Itochu and Sumitomo (through Philippines subsidiaries Dole and Sumifru respectively) willing to invest an additional ₱12.9 billion through 2018 to expand their integrated farming projects in Mindanao; Sumitomo, Sojitz, and Mitsui jointly invested in Coral Bay Nickle Corp and Taganito High Pressure Acid Leaching (THPAL) Nickle Corp in Surigao and Palawan, at a cost of ₱80 billion.

Mitsubishi, Sojitz, Mitsui, and Toyota Tsusho, and, all the seven trading houses are supporting the Philippines’ Comprehensive Automotive Resurgence Strategy (CARS) Program created in 2015 to attract new investments, stimulate demand and effectively implement industry regulations that will revitalize the Philippine automotive industry, and develop the country as a regional automotive manufacturing hub.

All the Japanese firms also expressed interest in the Philippines’ so called “Golden Age of Infrastructure,” like the railway and subway projects, the Clark Green City project, the Expanded Port and RoRo Building programs, and the Airport Development projects.

The Japanese trading houses were also encouraged to use their expansive business systems to help in planning an efficient set of economic infrastructure, such as farm-to-market roads, bridges, seaports, airports, railways for cargo, passengers and RORO vessels, and service providers.

“The fundamentals are there in terms of a fast-growing economy, a 109-million population base, standing trade agreements, and a young, talented, and dedicated work force,” Lopez said. - Tomas S. Noda III of Deal Street Asia

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Japanese Billionaire Plans to Transform Philippines into “The Next Hawaii”

Kazuo Okada. Photo: Japan Daily Press

Okada to transform the Philippines into ‘the next Hawaii’

Billionaire Kazuo Okada, whose net worth stands at $2.4 billion currently, intends to transform the Philippines (EPHE) (PIE) into “the next Hawaii.” The country’s appealing beaches and its plan to become a major leisure and entertainment (BJK) (PEJ) hub in competition with the likes of Macau and Singapore stand in support of Okada’s intentions. The Japanese tycoon believes that the country can become a money-spinning tourist destination as more and more Chinese citizens visit its shores.

The $2.4 billion Okada Manila Resort, Philippines

Okada, Chairman of the Tokyo exchange traded Universal Entertainment Corp. (TYO: 6425), who recently opened a casino resort in Manila, believes that Philippine gaming market could ultimately surpass Singapore. “Our initial target is to have 30% of the guests from the international segment, but we would eventually like to bring that up to 50%,” said Okada. “We are looking at China, Taiwan, Korea and Japan — if you think about it from proximity, a lot of our guests will initially be coming from China and Taiwan.”

The Okada Manila resort was granted permission to commence gambling operations by the Philippine Amusement and Gaming Corporation (PAGCOR). The costs for the completion of the massive project are estimated to be $2.4 billion. The casino resort was developed by the Philippine-based Tiger Resort, Leisure and Entertainment Inc., which is a subsidiary of Universal Entertainment, headed by Okada. Much of the project was financed via debt and a private placement that was concluded in October 2016.

Sales expanding on daily basis

After a three-day preview event on December 21, 2016, Okada’s Manila casino resort has been open to gaming and catering. The resorts’ hotel and restaurants should open with Okada Manila’s official opening which is scheduled for the first quarter of 2017.

According to a recent filing with the JASDAQ Securities Exchange by Universal Entertainment Corp (TYO: 6425), sales at the Okada Manila casino resort “are currently expanding on a daily basis.”

The Philippines: the next best leisure destination?

In August 2016, the Sino-America Gaming Investment Group LLC and the Macau Resources Group Ltd. (MRGLF) had also been seeking approvals from the Philippine Tourism Infrastructure and Enterprise Zone Authority, or TIEZA, for the start of their Mactan Leisure City project in the country.

Kazuo Okada, too, plans on building three more casino venues in Entertainment City. It may not be long before we see the likes of Wynn Resorts Ltd. (WYNN), MGM Resorts International (MGM) and Las Vegas Sands Corp (LVS), looking to expand their business at the Philippine shores. - FRONTERA NEWS

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Jones Cup 2015: Gilas Pilipinas beats Japan 75-60 ahead of Iran clash

Jones Cup: Gilas routs Japan, 75-60

Metro Manila (CNN Philippines) — Gilas Pilipinas pulled away early in the fourth quarter to rout Japan, 75-60, in the 37th William Jones Cup on Wednesday (September 2) at the Xinzhuang Stadium in Taipei.

After a tight first three quarters, Gilas fired at will from the three-point area and clamped down on defense to break free in the payoff period.

During that stretch, newcomer Moala Tautuaa scored back-to-back throwdowns followed by five three-pointers from veterans Jayson Castro, Gary David, Ranidel de Ocampo, and Gabe Norwood to bury Japan for good.

Rising star Terrence Romeo led Gilas anew with 16 points. Castro, De Ocampo, and Tautuaa added 10 apiece.

The Filipinos, who led by as much as 17 points during the spirited surge, now hold a 3-1 win-loss card with the win, improving their chances of topping the tourney they ruled in 2012.

A hurdle on their road to the championship, however, is Iran, which is currently atop the leaderboards with a 4-1 record. Gilas is tied with Chinese Taipei (Blue) and Russia at No. 2.

The Philippines will face Iran, which is coming off a blowout loss to Team USA which are spearheaded by former Philippine Basketball Association (PBA) imports (September 3) at 1 p.m.- CNN

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Philippines confirmed buying SKR/ Japan made diesel powered Submarine- For the first time

Philippines is interested in acquiring Diesel submarines based on technology from the Japan Maritime Self-Defense Force's Soryu-class vessel. image:asia.nikkei.com

Philippines to buy submarines and advanced missile systems for the first time

This will ensure strength in the South China Sea

Manila: For the first time, the Philippines will buy electric and diesel-run submarines, including advanced missile systems, as listed in its $22.11 billion (998 billion pesos or Dh83.166 billion) modernization plan that was approved in July, to ensure its strength against China, Taiwan, Vietnam, Brunei, and Malaysia which have overlapping claims in the South China Sea, sources said.

“The Philippine Navy will buy several submarines and missile systems in the next five years from private manufacturing firms either from South Korea or Japan,” a military source who requested anonymity told Gulf News.

“The ambitious purchase was scheduled after the Philippine economy grew, received good ratings from rating agencies, and allowed borrowing for expensive war materials, but the Philippines could not yet match China’s 26 submarines,” said the same source.

In 2013, the Philippine Navy bought two 1.400 tons Incheon-class frigates (also called Future Frigate experimental or FFX), manufactured by South Korea’s Hyundai Heavy Industries and STX Offshore and Shipbuilding for $400 million (18 billion pesos or Dh1.5 billion); two strategic sealift vessels or floating command centers which can transport three helicopters per vessel, soldiers, and supplies at sea, from Indonesia’s PT PAL (Persero) for $85.7 million (3.86 billion pesos or Dh321.6 million). The new frigates and sealift vessels will arrive in the Philippines at the end of 2015 or early 2016, President Benigno Aquino announced recently.

It is widely reported that the Philippine Navy is manned by three US-made refurbished frigates: BRP Tagbanua; BRP Gregorio del Pilar and BRP Ramon Alcaraz, but Japan’s defense ministry said the Philippine Navy has 80 warships; China, 892; Malaysia, 208; and Vietnam, 94.

The Philippine Coast Guard also bought 10 40-metre-long multi-purpose response vessels (MRRV) from Japan in late 2013 for $184 million (8.09 billion pesos or Dh674.6 million), in a loan forged with Japan International Cooperation Agency (JICA) in 2014. They will augment the Coast Guard’s 19 rescue vessels, when they arrive in the Philippines at the end of 2015, sources said.

The Coast Guard secured a $20 million (900 million pesos or Dh75 million) loan from the United States’ Defense Threat Reduction Agency (it has a maritime security project with the US’ Weapons for Mass Destruction Proliferation Prevention Program) for three aerial surveillance radars, two surface sensors and three surveillance planes for the Philippine Coast Guard National Coast Watch Centre in northern Luzon and southwest Philippines.

Recently, the Philippine Air Force bought 12 new FA-50 fighter-trainers made by Korea Aerospace Industries. six Close Air Support Aircraft; seven of 13 AW-109 helicopters; and six of eight Bell-412 combat utility helicopters made by Korea Aerospace Industries. The two fighters will arrive in December 2015 or early 2016, and the rest in 2017.

Japan’s defense ministry said the Philippines has a total of 26 combat aircraft, compared with China’s 2,582 combat aircraft.

The Philippine government also allotted $22 million (1 billion pesos or Dh83.33 million) for the development of three new naval bases that will protect its 36,000 kilometer coastline facing the South China Sea.

In 1995, Congress approved an $8.08 billion (364 billion pesos or Dh30.3 billion) military modernization plan for 15 years. But only 10 per cent of the approved budget was secured by a loan 15 years later, in 2010, the budget department said.

China, Taiwan, and Vietnam claim the whole of the South China Sea and several parts of the oil-rich Spratly Archipelago. Brunei, Malaysia, and the Philippines claim their respective exclusive economic zones in the South China Sea and parts of the Spratly Archipelago. - Gulf News

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PHOTOS: Philippines challenges China's Claim of West Philippine Sea at UNCLOS Tribunal in The Hague

Philippines challenges China's Claim of country's exclusive economic zone at UNCLOS Tribunal in The Hague. image: inquirer.net

IN PHOTOS: Philippines challenges China in The Hague

In photos emailed to Rappler, the Permanent Court of Arbitration gives us a glimpse of the closed-door hearings pitting Manila against Beijing

MANILA, Philippines – Behind closed doors, the Philippines recently waged a legal battle against China in The Hague, Netherlands, in a historic case over the disputed West Philippine Sea (South China Sea).

The Philippines on Thursday, July 23, is set to submit a new document to The Hague to bolster its case.

While Manila pursues this, a question remains: What exactly happened during hearings from July 7 to 13?

The Permanent Court of Arbitration (PCA) in The Hague, which serves as the venue for the arbitration proceedings, emailed Rappler high-resolution photos to give us a glimpse of the closed-door hearings.

China claimed the shores of Vietnam, Philippines, Malaysia, Indonesia, Brunei and Japan as their own

The photos show a powerhouse team, led by internationally acclaimed lawyer Paul Reichler, defending the Philippines' case before an equally high-caliber arbitral tribunal in The Hague.

The tribunal said around 60 members joined the Philippine team. (READ: Binay hits Philippine team vs China in The Hague))

Check out these photos from the Permanent Court of Arbitration (PCA) in The Hague.

TOP DIPLOMAT. Philippine Foreign Secretary Albert del Rosario delivers an opening statement. Photo courtesy of PCA

IN SESSION. Early on, the arbitral tribunal in The Hague decides to hold the hearings behind closed doors. Photo courtesy of PCA

TOP GOVERNMENT LAWYER. Philippine Solicitor General Florin Hilbay, who serves as agent for his country, delivers a statement. Photo courtesy of PCA

TEAM OF EXPERTS. The counsel team for the Philippines, including Professor Bernard Oxman, Professor Alan Boyle, and Mr Lawrence Martin, in the closed-door hearings. Photo courtesy of PCA

HISTORIC CASE. The arbitral tribunal in The Hague, Netherlands, listens to the first country that brought China to court over the West Philippine Sea (South China Sea). Photo courtesy of PCA

'GIANT SLAYER.' Internationally acclaimed lawyer Paul Reichler, the Philippines' chief counsel, delivers a statement. Photo courtesy of PCA

REPRESENTING GOVERNMENT. Members of the Philippine delegation, including Justice Secretary Leila de Lima, Supreme Court Senior Associate Justice Antonio Carpio, and Deputy Executive Secretary for Legal Affairs Menardo Guevarra. Photo courtesy of PCA

OBSERVER DELEGATIONS. The tribunal allowed observers from the following countries – Vietnam, Malaysia, Indonesia, Thailand, and Japan – to attend the hearings. Photo courtesy of PCA

HIGH-CALIBER TRIBUNAL. The arbitral tribunal is led by Judge Thomas Mensah (president, C), the first president of the International Tribunal for the Law of the Sea. The high-caliber tribunal also includes the following (L to R): Judge Jean-Pierre Cot, Judge Stanislaw Pawlak, Judge Rüdiger Wolfrum, and Professor Alfred H. A. Soons. Photo courtesy of PCA

TEAM PHILIPPINES. Representing all 3 branches of Philippine government, the Philippine delegation comes in full force in The Hague. Photo courtesy of PCA

The 5-member tribunal said it "now enters its deliberations" on whether it has the right to hear the Philippines' case. It said it expects to rule on this matter "before the end of the year."

The tribunal said it "is conscious of its duty under the Rules of Procedure to conduct proceedings 'to avoid unnecessary delay and expense and to provide a fair and efficient process.'"

Once the tribunal decides it has jurisdiction over the case, the Philippines can already present the meat of its arguments. (READ: EXPLAINER: Philippines' 5 arguments vs China)

The Philippines said it expects a definitive ruling against China by 2016 – Rappler.com

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Japan agency upgrades PH's credit rating to BBB+

Japan credit rating agency raises Philippine rating

THE Philippines has received another credit rating upgrade, which is the highest rating the country has ever achieved.

In a report released Monday, Japan Credit Rating Agency Ltd. (JCR) gave the Philippines BBB+ from BBB rating. This was just a notch away from the minimum score in the "A" category.

The latest upgrade from JCR is the 22nd positive rating action (covering both improvement in outlook and actual credit scores) for the Philippines from major international credit rating agencies since 2010, the Investor Relations Office (IRO) of the Bangko Sentral ng Pilipinas said.

This development places the Philippines' credit rating two places ahead of Indonesia's BBB- and at par with that of India, whose economy is seven times the size of that of the Philippines.

"JCR is of the view that the Philippine economy will, by and large, sustain an annual growth of around 6 percent in the years to come driven by strong domestic demand," the rating agency said.

In the report, JCR highlighted the ability of the Philippines to maintain sound fiscal position, high external liquidity, and solid economic growth.

It also cited general stability in the country's political situation even as potential candidates for national positions gear up for the 2016 elections.

JCR also noted the stable social situation amid inroads in poverty reduction, with the poverty rate falling from 28.6 percent in 2009 to 25.8 percent in the first half of 2014.

The new credit rating is assigned a "stable" outlook, which means adjustment is unlikely in the short term.

Government economic officials welcomed the upgrade, which marked the third positive rating action from JCR over the past five years.

"The latest ratings decision of JCR, which makes the Philippines very close to securing a rating within the 'A' category, appropriately reflects the strength exhibited by the economy. Inflation has remained low, external liquidity ample, and banking system sound. All this has been achieved despite a challenging external environment," BSP Governor Amando Tetangco said.

"The upgrade to BBB+ is a recognition partly of how the country’s fiscal sector has transformed since 2010. Fiscal reforms, both legislative and administrative, have resulted in more buoyant revenue collections, manageable deficits, and lower debt service burden. The pace by which the debt burden has declined over the years is one solid proof of the rare kind of fiscal discipline that the Philippines exercises," Finance Secretary Cesar Purisima said.

IRO, which serves as the government's central point of contact for credit-rating agencies, underscored the need for public vigilance to ensure that the Philippines keeps its hard-earned investment grade sovereign credit ratings beyond 2016.

"The Philippines has achieved unprecedented gains in its credit standing over the past five years. After suffering from stubborn speculative credit ratings not too long ago, the Philippines now enjoys a seal of good housekeeping from all major international credit rating agencies," IRO Executive Director Editha Martin said.

"There should be no turning back. The need to maintain good governance – which boosts confidence of investors, creditors, rating institutions, and the general public – even after a change in leadership in 2016 cannot be overemphasized," Martin said.- (SDR/Sunnex)

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India, Japan & South Korea agreed trilateral military pact against China

Japan and South Korea on 29^th June 2012 agreed to share intelligence in their first joint military pact since World War II.

The agreement is seen as a breakthrough in ties between two neighbors with a difficult history. Japan ruled Korea as a colony for several decades until the end of World War II in 1945, and Seoul has often been wary of Japan's postwar military development, but the nations have many shared concerns, particularly North Korea and China.

Noting that the South China Sea was witnessing "competing claims", India strongly pitched for co-operation instead of competition in the seas and oceans at a trilateral meeting with Japan and South Korea.

With China's growing assertiveness in the West Philippines Sea (South China Sea), India, Japan and South Korea - Asia's three leading democracies –( June 29, 2012 )Friday held their first trilateral meeting in India and pitched for freedom of seas and expanding their multifaceted cooperation.

Asserting that India, Japan and Republic of Korea depend heavily on the Sea Lanes of Communications (SLOCs) for their energy security which are also the mainstay for trade and connectivity, Sanjay Singh, Secretary (East) in Ministry of External Affairs, said "there is indeed a compelling case for us to cooperate on maritime security."

"India has a valued geostrategic location straddling the SLOCs. The Indian Ocean Rim is characterized by large Exclusive Economic Zones and unexplored and untapped marine resources. Similar potential exists for example in the South China Sea which today is witnessing competing claims.

The three sides discussed a host of regional and global issues to cement their trilateral cooperation cutting across diverse areas, including maritime cooperation, security, terrorism, and trade and investment.

The trilateral dialogue seeks to address the three major themes - the evolving Asian security architecture, non-traditional security issues and prospects and challenges for this process.

The India-Japan-South Korea trilateral seeks to reinforce the India-Japan-US trilateral dialogue that also focuses on expanding strategic and maritime cooperation.

They identified the Institute of Defense Studies and Analyses (IDSA), Korea National Diplomatic Academy, and Tokyo Foundation as the three partnering institutions to carry forward the trilateral dialogue.

"Being leading democracies of the world, we share a common commitment to democratic values, open society, human rights and the rule of law," Sanjay Singh, Secretary (East) in the external affairs ministry, said while underlining a congruence of strategic interests of the three leading economies of the region.

"We seek a peaceful and secure Asia free from the threats of terrorism, proliferation, piracy and conflict between states," he said.

Although China was not mentioned explicitly, it was very much the elephant in the room, with discussions focusing on maritime cooperation and freedom of navigation in international sea lanes of communication.

"There is common commitment to maintaining freedom of the seas, combating terrorism and promoting inclusive economic growth. India, Japan and ROK depend heavily on the Sea Lanes of Communications (SLOCs) for their energy security," Singh said.

"These are also the mainstay for trade and connectivity amongst our countries and other countries in the region. India has a valued geostrategic location straddling the SLOCs," he said.

In this context, the three sides noted that like the Indian Ocean Rim, West Philippines Sea has tremendous potential for cooperation, but is "is witnessing competing claims".

"Our common objective is to see that the seas and oceans become regions of cooperation instead of competition, particularly as our energy security and trade depends on them," Singh said.

Underlining the need for maritime cooperation, the sides discussed ways to expand trilateral cooperation to deal the conventional risks associated with nuclear power and confront the risks of nuclear and missile proliferation in our neighborhoods.

"Deepening cooperation amongst our defense and security establishments will promote our mutual security," said Singh.

Beijing has yet to react to the India-Japan-South Korea trilateral, but it has been uneasy about leading democracies of the region getting together in what it sees as an exercise in encirclement of a rising China.

Trilateral Military pact

The pact establishes a framework for sharing intelligence in such areas as missile defense, North Korea's nuclear weapons program, Chinese military operations and other regional security matters.

It was previously approved by South Korea, and Japan's Cabinet gave its final approval Friday ahead of a formal signing ceremony. "Considering the security situation in east Asia, it is very significant for us to create the foundations for sharing information," said Japan's foreign minister, Koichiro Genba. "I think this is a very historic event."

The pact reflects deepening mutual concerns that more cooperation is needed to enhance security readiness.

The two countries are increasingly concerned by potential threats from North Korea, which is developing its long-range missile and nuclear weapons capabilities. They are also closely watching the rise of China's military.

North Korea heightened regional tensions in April with the launch of a rocket that was widely criticized as a test of long-range missile technology. The launch was of particular concern to Seoul and Tokyo because they are within reach of the North's missile arsenal.

Such fears spurred the government efforts to cooperate more closely on intelligence sharing, though the pact remains controversial among some in South Korea.

"An accord for military-information protection with Japan is necessary given the ever-growing threat from the North," South Korea's JoongAng Daily newspaper said in an editorial. "The more quality information we have about the North, the better our security."

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COMMENTARY: Is a Nuclear War with China Possible?

BY LAWRENCE S. WITTNER

While nuclear weapons exist, there remains a danger that they will be used.  After all, for centuries national conflicts have led to wars, with nations employing their deadliest weapons.  The current deterioration of U.S. relations with China might end up providing us with yet another example of this phenomenon.

The gathering tension between the United States and China is clear enough.  Disturbed by China's growing economic and military strength, the U.S. government recently challenged China's claims in the South China Sea, increased the U.S. military presence in Australia, and deepened U.S. military ties with other nations in the Pacific region.  According to Secretary of State Hillary Clinton, the United States was "asserting our own position as a Pacific power."

But need this lead to nuclear war?

Not necessarily.  And yet, there are signs that it could.  After all, both the United States and China possess large numbers of nuclear weapons.  The U.S. government threatened to attack China with nuclear weapons during the Korean War and, later, during the conflict over the future of China's offshore islands, Quemoy and Matsu.  In the midst of the latter confrontation, President Dwight Eisenhower declared publicly, and chillingly, that U.S. nuclear weapons would "be used just exactly as you would use a bullet or anything else."

Of course, China didn't have nuclear weapons then.  Now that it does, perhaps the behavior of national leaders will be more temperate.  But the loose nuclear threats of U.S. and Soviet government officials during the Cold War, when both nations had vast nuclear arsenals, should convince us that, even as the military ante is raised, nuclear saber-rattling persists.

Some pundits argue that nuclear weapons prevent wars between nuclear-armed nations; and, admittedly, there haven't been very many—at least not yet.  But the Kargil War of 1999, between nuclear-armed India and nuclear-armed Pakistan, should convince us that such wars can occur.  Indeed, in that case, the conflict almost slipped into a nuclear war.  Pakistan's foreign secretary threatened that, if the war escalated, his country felt free to use "any weapon" in its arsenal.  During the conflict, Pakistan did move nuclear weapons toward its border, while India, it is claimed, readied its own nuclear missiles for an attack on Pakistan.

At the least, though, don't nuclear weapons deter a nuclear attack?  Do they?  Obviously, NATO leaders didn't feel deterred, for, throughout the Cold War, NATO's strategy was to respond to a Soviet conventional military attack on Western Europe by launching a Western nuclear attack on the nuclear-armed Soviet Union.  Furthermore, if U.S. government officials really believed that nuclear deterrence worked, they would not have resorted to championing "Star Wars" and its modern variant, national missile defense.  Why are these vastly expensive—and probably unworkable—military defense systems needed if other nuclear powers are deterred from attacking by U.S. nuclear might?

Of course, the bottom line for those Americans convinced that nuclear weapons safeguard them from a Chinese nuclear attack might be that the U.S. nuclear arsenal is far greater than its Chinese counterpart.  Today, it is estimated that the U.S. government possesses over five thousand nuclear warheads, while the Chinese government has a total inventory of roughly three hundred.  Moreover, only about forty of these Chinese nuclear weapons can reach the United States.  Surely the United States would "win" any nuclear war with China.

But what would that "victory" entail?  A nuclear attack by China would immediately slaughter at least 10 million Americans in a great storm of blast and fire, while leaving many more dying horribly of sickness and radiation poisoning.  The Chinese death toll in a nuclear war would be far higher.  Both nations would be reduced to smoldering, radioactive wastelands.  Also, radioactive debris sent aloft by the nuclear explosions would blot out the sun and bring on a "nuclear winter" around the globe—destroying agriculture, creating worldwide famine, and generating chaos and destruction.

Moreover, in another decade the extent of this catastrophe would be far worse.  The Chinese government is currently expanding its nuclear arsenal, and by the year 2020 it is expected to more than double its number of nuclear weapons that can hit the United States.  The U.S. government, in turn, has plans to spend hundreds of billions of dollars "modernizing" its nuclear weapons and nuclear production facilities over the next decade.

To avert the enormous disaster of a U.S.-China nuclear war, there are two obvious actions that can be taken.  The first is to get rid of nuclear weapons, as the nuclear powers have agreed to do but thus far have resisted doing.  The second, conducted while the nuclear disarmament process is occurring, is to improve U.S.-China relations.  If the American and Chinese people are interested in ensuring their survival and that of the world, they should be working to encourage these policies.

* * *

Wittner is Emeritus Professor of History at the State University of New York/Albany. His latest book is "Confronting the Bomb: A Short History of the World Nuclear Disarmament Movement" (Stanford University Press). This commentary was distributed by PeaceVoice a program of the Oregon Peace Institute, Portland, OR.

http://www.peacevoice.info/

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South Korea – the Philippines Strengthen ties – SKorean President State Visit to the Philippines

The Philippines and South Korea will sign on Monday agreements envisioned to further strengthen overall ties between the two countries.

South Korean President Lee Myung-bak, who arrived in Manila on Sunday afternoon, will officially begin his state visit with a wreath-laying ceremony at the Rizal Shrine in Luneta before proceeding to Malacañang for a meeting with President Aquino.

The two leaders are expected to discuss, among other things, trade and investment opportunities, and tourism, Deputy Presidential Spokesman Abigail Valte said in an interview over dzRB, the government radio, on Sunday.

"There are many tourists from South Korea who come to the Philippines. We also have common interests in trade and investment. We know that the Republic of Korea is our development partner, particularly in agriculture and infrastructure, so we expect the flow of discussions to go around the topics that were mentioned," Valte said.

Filipino businessmen are hoping the state visit would result in a joint communiqué with South Korea in the form of an accelerated version of an economic partnership agreement (EPA).

The joint communiqué should outline initiatives that will further the exchange of trade, investments and people between the two countries, said Donald Dee, vice chairman and treasurer of the Philippine Chamber of Commerce and Industry (PCCI).

"We don't need to negotiate an EPA with Korea because we are already linked in several areas and we already have the Asean-Korea Free Trade Area [AKFTA]. We no longer have barriers when it comes to tariffs and manufacturing. We only need to have a joint communiqué," Dee told the BusinessMirror.

The document, Dee said, should focus on non-tariff barriers, investments, services and a mutual recognition agreement.

Currently, the country's EPA is with Japan. On a regional basis as part of the Association of Southeast Asian Nations (Asean), however, the Philippines has free-trade agreements with Japan, South Korea, China, India, Australia and New Zealand.

Based on the study of the Universal Access to Competitiveness and Trade, which serves as the PCCI think-tank, Dee said merchandise trade between the two countries increased rapidly since the forging of the AKFTA in 2007. Exports to South Korea are up 23 percent and it is now the eighth-largest trading partner of the Philippines.

South Korean investments, on the other hand, went up from less than $100 million in 2007 to $600 million in 2010. Among the top South Korean investors in the Philippines are Hanjin Heavy Industries and Construction, Samsung Electronics Philippines Manufacturing Corp., and Daelim Industrial Co. Ltd.

On the tourism side, Dee said Koreans make up 22 percent of the total foreign visitors to the Philippines.

With the existing complementarities economically and socially, Dee said the Philippines and South Korea could skip the tedious part of negotiating an EPA and proceed to the forging of a joint communiqué.

"We only need to list down all our matching industries and then reconcile our ambitions and expectations," Dee said.

The joint communiqué, he said, should state that South Korea and the Philippines will work together to enhance the economies of both countries.

The two countries will then separately outline their respective commitments on how their ambitions will be achieved in the areas of trade, investments, services and mutual recognition for the practice of professions.

Coinciding with the visit of Mr. Lee, a former CEO of Hyundai Engineering and Construction, the government has arranged a meeting between the PCCI and the South Korean business delegation at the Manila Hotel on Monday, which the South Korean leader will keynote. President Lee flew in at 1:30 p.m. on Sunday accompanied by his wife, Kim Myun-Ok.

Apart from his Palace engagements, Mr. Lee will also attend a town hall meeting at the Ateneo de Manila University before returning to Malacañang for a state dinner in his honor.

He will depart Manila on Tuesday morning.

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Clinton warns against intimidation in South China Sea dispute

U.S. Secretary of State Hillary Clinton on Wednesday urged claimants to the South China Sea not to resort to intimidation to push their cause in the potentially oil-rich waters, an indirect reference to China ahead of a regional leaders' summit.

Clinton reiterated that the United States wanted a candid discussion of the maritime dispute, which an Australian think tank warned earlier this year could lead to war, when the leaders gather in Bali, Indonesia, this week.

However, China says it does not want the issue discussed, putting it at loggerheads with the United States once again after they exchanged barbs over trade and currency at last week's meeting of Asia Pacific Economic Co-operation forum in Hawaii.

"The United States does not take a position on any territorial claim, because any nation with a claim has a right to assert it," Clinton said in Manila, while marking the 60th anniversary of the U.S.-Philippine Mutual Defense Treaty.

"But they do not have a right to pursue it through intimidation or coercion. They should be following international law, the rule of law, the U.N. Convention on Law of the Sea."

She said disputes in the sea lanes should be resolved through the 1982 United Nations Convention on the Law of the Sea (UNCLOS), which defined rules on how countries can use the world's oceans and their resources.

That could embolden Southeast Asia's hand against China, which has said it would not submit to international arbitration over competing claims to the area, believed to be rich in natural resources and a major shipping lane.

China says it has historical sovereignty over the South China Sea and so supersedes claims of other countries, including the Philippines, Vietnam, Malaysia and Brunei.

"Introducing a contentious subject into the meeting would only affect the atmosphere of cooperation and mutual trust, damaging the hard-won setting of healthy development in the region," Chinese Foreign Ministry spokesman Liu Weimin said on Wednesday. "That's is beyond any doubt."

Beijing bristles at what it calls U.S. interference and has blamed the maritime tensions on U.S. trouble making.

Estimates of proven and undiscovered oil reserves in the South China Sea range from 28 billion barrels of oil to as high as 213 billion barrels, U.S. figures showed in 2008. Gas deposits could be as high as 3.8 trillion cubic metres, the U.S. Geological Survey has estimated. Both would supply China with energy supplies for decades if proven.

China's resource needs and its risk-taking behaviour over staking its claim in the increasingly crowded sea lanes of the maritime region raise the possibility of armed conflict that could draw in the United States and other powers, the Lowy Institute said in a report in June.

Tensions flared again earlier this year with concerns raised over China's enforcement of its claim in areas also claimed by Vietnam and the Philippines, including the cutting of cables on survey ships, threats to ram some vessels and breaches of airspace by military aircraft.

UNITY

On Tuesday, the Philippines criticised its South East Asian neighbours for failing to take a united stand against China.

"ASEAN is now at a critical junction of playing a positive and meaningful role to contribute in the peaceful resolution of the disputes in the South China Sea," said Foreign Secretary Albert del Rosario.

Manila wants ASEAN to be able to help resolve sensitive issues without letting them affect bilateral or multilateral relations, he said.

Smaller Southeast Asian claimants view a U.S. presence and a multilateral approach to negotiations as strengthening their stance against China's all-encompassing claim on the sea.

ASEAN and China approved guidelines this year to make a code of conduct agreement signed in 2002 more concrete as they sought to cool tensions.

Indonesia's foreign minister, Marty Natalegawa, suggested claimants to the maritime region should pursue the code of conduct negotiations while apparently chiding China and the United States.

"ASEAN now has a clear scenario and approach. So ASEAN countries will not let the Southeast Asia region become a competition arena for countries who consider themselves as big powers, whoever or whenever they maybe," he told a press briefing.

"We have an interest to make a clear code of conduct (for the South China Sea) so that concerns from non-Southeast Asian countries can be reflected based on the interest of ASEAN countries' national interest," he said.

It was important for ASEAN to promote a break from "a self-fulfilling vicious circle of action and counter-reaction," he added.

Washington says its interest in the rift is to make sure a shipping lane that carries some $5 trillion in international trade a year is kept open and can be freely navigated.

"President Obama will reaffirm our national interest in the maintenance of peace and security in the region and internationally," Clinton said.

She said that included freedom of navigation, the rule of law and unimpeded lawful commerce, with the United States seeing UNCLOS as the overriding framework for territorial disputes.

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Philippines Sandwiched by 2 competing superpowers US-China

Philippines’ President Benigno Aquino III will discuss the disputes over the West Philippine Sea (South China Sea) and steps on further strengthening the long-standing economic and defense relations between the Philippines and the United States during his meeting with US President Barrack Obama in Bali, Indonesia where the 19th Association of Southeast Asian Nations (Asean) Summit is being held.

The President left at around 8 a.m. on Thursday for Indonesia from the tarmac of the 250th Presidential Airlift Wing at the Villamor Airbase in Paranaque City (Metro Manila).

In his pre-departure speech, the President cited the importance of the regional bloc, which was established in 1967 and is aimed at the "creation of a cohesive, peaceful, stable and resilient region".

In a press briefing at the Courtyard Mariott Bali Nusa Dua Hotel, Presidential Communications Development and Strategic Planning Office Secretary Ramon Carandang said that the United States has been exerting efforts to re-engage itself with the countries in the Asia-Pacific region, including the Philippines, which the world superpower considers as important partners in economic and political development.

"I think what's very clear is that the United States wants to re-engage itself in the Asia Pacific region, especially now that they're winding down their commitments to other parts of the world.

The Asia-Pacific region has become much more important to them economically and politically. And what we're seeing are manifestations of that increased importance that Asia-Pacific, including the Philippines, is taking and I am sure the discussions between the two leaders will hew to that general theme," he said.

When asked if the Philippines will seek security assistance from the United States on the dispute in the West Philippine Sea, Carandang said that the government has been considering that.

"I think we've been doing what we can already with the West Philippine Sea issue and the American presence here, and the fact that they agree with our position is something that we find helpful," he said.

Carandang added that the government welcomes any assistance from the US, specifically in increasing the maritime defense capabilities of the Philippines.

The bilateral talk betweens President Aquino and Obama is scheduled on Friday as part of the 19th Asean Summit and Related Summits.

Also attending the event are the heads of state of Asean's dialogue partners including Chinese Premier Wen Jiabao, Australian Prime Minister Julia Gillard, Japanese Prime Minister Yoshihiko Noda and United Nations Secretary General BanKi-moon, among others.

The Asean will widen on Saturday into the East Asia Summit which takes in Australia, China, India, Japan, South Korea and New Zealand, and this year welcomes the United States and Russia.

A major issue

The maritime dispute with China and a debate over whether to reward Myanmar for fledgling reforms are expected to dominate talks during the 19th Asean Summit.

With the eurozone lurching through a debt crisis, raising the specter of Asean's export markets drying up, there is also pressure on the 10-member bloc to speed up the integration of its potentially huge common market.

Obama is coming to Bali as the US rolls out a diplomatic campaign to assert itself as a Pacific power, including plans for up to 2,500 Marines to be deployed in Australia.

Its more robust role, which smaller Asian states welcome as a counterbalance to China, has caused friction with the two powers trading warnings that set the stage for a confrontation at the East Asia Summit.

The US has signaled that it will raise the issue of China's territorial claims over the West Philippine Sea, with its strategic shipping lanes and rich oil and mineral reserves, despite Beijing saying that the topic should be off-limits.

Secretary of State Hillary Clinton said on Wednesday on a visit to the Philippines, which along with Vietnam has complained that China is becoming more aggressive in asserting its claims, that threats were unacceptable.

"Any nation with a claim has a right to exert it, but they do not have a right to pursue it through intimidation or coercion," she said.

The Philippines, which has led calls for ASEAN to build a united front against China over the dispute, was slammed by China's state-run Global Times on Thursday, which said that it should be punished with trade boycotts and travel bans.

"The way that China punishes the Philippines should not be overdone or elicit regional fears toward China, but it must make the Philippines pay the price," said the paper, known for its nationalistic stance.

Diplomats in Bali have expressed concern that Southeast Asian nations may get squeezed between the competing interests of the two big world powers.

"We must ensure the stability and security of our region," Indonesian President Susilo Bambang Yudhoyono said in an opening speech.

"Asean must continue to play a proactive role to facilitate and engage itself in the resolution of issues," he said in an apparent reference to the West Philippine Sea dispute.

Bali, a resort island that is normally a haven for tourism and relaxation, has been transformed for the event, with six warships patrolling off the beaches and 7,000 police and soldiers providing a blanket security presence.

Myanmar issue

The Asean summit also sees the diplomatic debut of Myanmar's new military-backed government, which has surprised observers with a string of conciliatory moves since it was sworn in eight months ago.

The leaders are set to formally approve a plan to allow Myanmar to chair the regional bloc in 2014, despite objections from the United States which said that it was premature.

Myanmar's Information Minister Kyaw Hsan called on the US to recognize what he said were "irreversible" reforms and abandon its economic sanctions, in an interview with the Wall Street Journal published on Thursday.

Kyaw Hsan blamed the sanctions for the country's lack of development and said that they forced Myanmar to be reliant on Chinese companies.

"When we are striving for development, we cannot be choosers -- we have accepted what is best for the country," he added.

The nominally civilian government has held direct talks with opposition leader Aung San Suu Kyi, freed 200 dissidents, frozen work on an unpopular mega-dam and passed a law giving workers the right to strike.

But rights campaigners say those measures could easily be reversed and that handing Myanmar the diplomatic prize could remove the incentive for more fundamental change in a nation still accused of serious rights abuses.

Asean's leaders will also review stuttering progress on an ambitious plan for a common and barrier-free market by 2015, a task made more urgent by the crisis in major export markets in Europe.

The gaps between the region's economies--which range from the wealthy city-state of Singapore to underdeveloped Laos and Myanmar -- are a formidable barrier to establishing a common market of more than 600 million people.

But Indonesian Trade Minister Gita Wirjawan said on Wednesday that the economic woes in Europe and the US presented an opportunity for Asean to "behave more collectively".

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Not contented in Spratlys; China now Claim Palawan islands

During the APEC summit 2011 in Hawaii; China protest the Philippines to use its resources and explore the oils in Palawan and pronounced its claim to the Palawan Islands.

China has claimed new territory less than 50 miles (80 kilometers) from a Philippine province, boosting tensions over potentially resource-rich areas of the South China Sea, but the Philippines has dismissed the claim, an official said Monday.

Energy Undersecretary Jose Layug Jr. told The Associated Press that China protested a Philippine plan to explore for oil and gas in the area in July. It is the closest point in waters off the main Philippine islands that China has claimed in the increasingly tense territorial disputes.

Beijing has been asserting its territorial claims more aggressively as its economic and diplomatic muscle has grown. Its new claims are likely to bolster Philippine resolve to seek a U.N. ruling on the long-simmering disputes, which involve China, the Philippines and four other claimants.

Among the areas being contested is the Spratlys, a chain of up to 190 islands, reefs, coral outcrops and banks believed to be sitting atop large deposits of oil and natural gas, which many fear could be Asia's next flash point for conflict.

The issue is expected to be discussed Wednesday with visiting U.S. Secretary of State Hillary Rodham Clinton.

The two new areas being claimed by China are not part of the Spratlys, Layug said.

The Chinese Embassy delivered a protest to the Philippine government on July 4 after Manila invited foreign companies to bid for the right to explore for oil and gas in 15 areas. Chinese officials opposed the inclusion of "areas 3 and 4" northwest of Palawan province, claiming they fall under Chinese sovereign territory.

"The Chinese government urges the Philippine side to immediately withdraw the bidding offer in areas 3 and 4, refrain from any action that infringes on China's sovereignty and sovereign rights," China said in a diplomatic note to Manila, adding that the Philippine action "cannot but complicate the disputes and affect stability in the South China Sea."

China told the Philippine government that the planned oil explorations violated a nonbinding 2002 accord that called on claimants to South China Sea territories to stop occupying new areas and avoid action that could spark tension.

In Beijing, Chinese Foreign Ministry spokesman Liu Weimin said at a regular briefing: "We do not want foreign commerce involved in these kinds of investment and disputes over the South China Sea."

Palawan province, about 510 miles (820 kilometers) southwest of Manila, faces the South China Sea, which is claimed entirely by China.

One of the offshore areas now being claimed by Beijing lies just 49 miles (79 kilometers) northwest of Palawan, while the other is 76 miles (123 kilometers) from the western Philippine province, Layug said.

The Philippine government told China the areas are located well within Philippine waters and are far from any disputed area, officials said.

"The areas that we're offering for bidding are all within Philippine territory," Layug said. "There is no doubt about that."

The two areas are more than 500 miles (800 kilometers) from the nearest Chinese coast, Layug said.

About 50 foreign investors, including some of the world's largest oil companies, have expressed interest in exploring for oil and gas in the Philippines, half of them in the new areas being claimed by China, because of strong indications of oil there, he said.

None of the prospective foreign companies has expressed concern over the territorial disputes, Layug said.

"Of course their issue would be ensuring security and the support of the Philippine government when they are awarded the contract," he said.

In March, two Chinese vessels tried to drive away a Philippine oil exploration ship from Reed Bank, another area west of Palawan. Two Philippine air force planes were deployed, but the Chinese vessels had disappeared by the time they reached the submerged bank.

The Philippines protested the incident, which it said was one of several intrusions by China into its territorial waters in the first half of the year. Vietnam has also accused Chinese vessels of trying to sabotage oil exploration in its territorial waters this year, sparking rare anti-China protests in Vietnam.

A British company behind the exploration at Reed Bank found very strong indications of natural gas and plans to start drilling in about six months, Layug said.

President Benigno Aquino III plans to discuss a Philippine proposal at an Association of Southeast Asian Nations summit this week in Bali, Indonesia, to segregate disputed South China Sea areas so coastal states can freely make use of non-disputed areas. China has opposed the plan.

Aquino's government also plans to bring the territorial disputes before the United Nations for possible arbitration.

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