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Philippines says won’t stop projects with China firms blacklisted by U.S

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MANILA (Reuters) – The Philippines will not halt infrastructure projects involving Chinese firms blacklisted by ally the United States and will make its own decisions, not those of a foreign power, the president’s spokesman said on Tuesday.

President Rodrigo Duterte will not follow Washington’s move to sanction Chinese firms involved in building and militarising artificial South China Sea islands because infrastructure was a national priority, his spokesman Harry Roque said.

“We are not a vassal state of any foreign power and we will pursue our national interest,” Roque told a regular news conference.

“Our national interest is to ensure flagship projects are completed.”

Duterte has a race against time to make headway in his $180 billion infrastructure overhaul, which is fraught with complications.

The United States, a defence treaty ally of the Philippines, has blacklisted 24 Chinese companies and targeted individuals over the building of military facilities on submerged reefs in disputed waters, escalating tensions with Beijing.

The Philippine foreign minister had recommended his government terminates deals with those entities.

Duterte’s non-intervention could cause some friction, as several of China’s islands challenge his country’s interests, most notably Mischief Reef, built within its 200-mile Exclusive Economic Zone and equipped with missiles capable of striking the Philippines.

Among firms involved are China Communications Construction Co (CCCC) (601800.SS), which is has teamed up with a Philippine partner for a $10 billion airport project, and its subsidiary, China Harbour Engineering Company, which is partnering on a $1.2 billion reclamation project with the firm of tycoon Dennis Uy, Duterte’s associate and biggest election campaign donor.

China Harbour will partner also with the Philippines’ richest family on separate $1.86 billion reclamation venture.

Those firms have not responded to Reuters requests for comment on the blacklisting.

Opposition lawmaker Risa Hontiveros filed a senate resolution on Tuesday to investigate possible collusion by Filipinos over China’s artificial islands.

“It is not hard to suspect dubious engagement by either party,” Hontiveros said.

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