Manila apologizes, and Taiwan lifts sanctions

Taiwan has lifted punitive sanctions against the Philippines after a sudden apology from Manila, ending an unusual and economically damaging spat between two Pacific Rim neighbors that the United States counts as strategic allies.

Relations between the two Asian democracies are returning to their state before May 9, when the Philippine coast guard shot a Taiwanese fisherman to death in overlapping waters of the Luzon Strait between the two sides.

Outraged by Manila’s defensive initial response to the shooting,Taipei quickly approved eight sanctions that hit the impoverished country’s economy and rippled into two-way trade worth nearly $11 billion last year. Taiwan also suspended most bilateral exchanges.

Manila’s agreements this week to apologize, compensate the slain 65-year-old man’s family, start fishery negotiations, and seek charges against the coast guard shooters prompted Taiwan to lift the sanctions and declare relations normal.

The move comes as relief to the Philippine travel sector, which draws 4 percent of foreign tourists from Taiwan, and to 88,000 Filipino migrant workers faced with leaving Taiwan once contracts ended. About 3,000 would have left per month.

“To reach a resolution is best for both sides,” says Hsu Yung-ming, political science professor at Soochow University in Taipei. “The cost of sanctions was too high, whether for the Philippines or Taiwan. Taiwan needs Filipino labor and the Philippines needs Taiwan’s tourists.”

Impact on the US

Resumption of friendly ties is also likely to be welcomed in the United States, where officials look to a chain of Pacific Rim democracies as allies in the face of a rising China.

A prolonged dispute “would cause a negative impact on the US rebalancing strategy in the Asia Pacific,” says Kwei-bo Huang, diplomacy professor at National Chengchi University in Taipei. “The US can’t do it alone, so the US hopes to see a more peaceful situation between allies.”

US officials announced a pivot to Asia in 2011 in part to strengthen military alliances. Former US cold war foe China fears the rebalancing is aimed at containing its expansion.

Washington has stepped up military cooperation with the Philippines since last year, when the archipelago hit a standoff with China over a disputed tract of water rich in fisheries and undersea gas or oil reserves. The US government is also bound by a 1979 congressional act to consider helping Taiwan if the island is threatened militarily. Japan and South Korea are other key allies.

China, increasingly powerful militarily as well as economically, has grown bolder in asserting maritime claims to secure resources. It also claims sovereignty over self-governed Taiwan and has not ruled out the use of force if peaceful reunification eventually fails.

Taiwan and the Philippines will follow up their dispute with talks on fishing rights within a month to avoid more mishaps and cut down on arrests of Taiwanese vessels – a total of 22 to date, according to Taiwanese authorities.

But negotiations are expected to be tough, because neither side wants to roll back its claims in the 250 kilometers (160 miles) of water separating them.

The two sides may just agree to disagree. “Local fishermen simply hope for some understanding from the Philippine government,” says Mr. Hsu of Soochow University.