China Tension Is High on Obama’s Agenda at Asia-Pacific Summit by Reuters @FortuneMagazine November 17, 2015, 10:07 AM EST E-mail Tweet Facebook Linkedin Share icons U.S. President Barack Obama put tensions over Beijing’s claims to the South China Sea squarely on the agenda ahead of an Asia-Pacific summit on Tuesday, pointedly visiting the main warship of close ally the Philippines shortly after he landed in Manila. While Obama affirmed a commitment to the Philippines’ security and to freedom of navigation in regional waters, a senior official in Beijing said China was the real victim of the waterway dispute because other countries had illegally occupied islands there. The verbal jousting could cast a shadow over the Asia Pacific Economic Cooperation (APEC) summit of about 20 heads of state and government, including Chinese President Xi Jinping. Manila has said it will not bring up the maritime dispute to avoid embarrassing Xi, but could not prevent others from doing so. Xi also arrived in Manila on Tuesday, but did not make any public comments. Shortly after Air Force One touched down in Manila, Obama boarded the Gregorio del Pilar, a Philippines navy frigate that was a U.S. Coast Guard cutter until 2011 but on Tuesday flew the flags of the two allies. “We have a treaty obligation, an iron-clad commitment to the defense of our ally the Philippines,” he said, flanked by about two dozen U.S. and Philippines uniformed navy personnel. “My visit here underscored our shared commitment to the security of the waters of this region and to freedom of navigation.” He did not mention China but the symbolism of his visit was hard to miss: the aging vessel is now a mainstay of the Philippine Navy, operating around the Spratly islands in the South China Sea that are claimed by both Manila and Beijing. Obama also announced two more U.S. ships would be transferred to the Philippines as part of a two-year $250 million package to enhance regional maritime security – a research vessel to help navigate territorial waters and a coast guard cutter for “long endurance patrols.” He brought the dispute up again at a meeting with Australian Prime Minister Malcolm Turnbull, telling reporters it was important to uphold the “basic principle that these issues should be resolved by international norms and rule of law, and peacefully settled.” Hours earlier, Chinese Vice Foreign Minister Liu Zhenmin said China was the real victim in the South China Sea dispute as “dozens” of its islands and reefs had been illegally occupied by three of the claimants. He did not name any countries. “The Chinese government has the right and the ability to recover the islands and reefs illegally occupied,” Liu told reporters in Beijing. “But we haven’t done this. We have maintained great restraint with the aim to preserve peace and stability.” Beijing has overlapping claims with Vietnam, the Philippines, Malaysia, Taiwan and Brunei in the South China Sea, through which $5 trillion in ship-borne trade passes every year. Last week, U.S. B-52 bombers flew near Chinese artificial islands in the area, signaling Washington’s determination to challenge Beijing over the disputed sea. The APEC meeting is the first of two regional summits that were supposed to bolster trade and security ties but have been clouded by last week’s coordinated attacks on Paris by the Islamic State. Earlier this week, the G20 summit in Turkey was also dominated by discussions about the violence emanating from Syria’s 4-1/2-year-old civil war. From Manila, many of the leaders go on to Kuala Lumpur to attend an East Asia summit at the weekend. For Obama, the latest flurry of summitry illustrates how his effort to “rebalance” U.S. policy toward Asia-Pacific countries has consistently run into the geopolitical reality that the persistently volatile Middle East cannot be ignored. The Philippines was on high alert as the leaders arrived for the APEC meeting. Police in Manila, a city of 12 million, closed off many roads leading to the venues of the meeting, causing heavy traffic jams. Local media said the gridlock was so bad that a woman in labor didn’t make it to hospital and gave birth in her car. Philippines officials say there has been no intelligence suggesting there might be an attack on the Manila summit but about 30,000 police and soldiers have been deployed to guard it. In a draft of the APEC leaders’ final statement seen by Reuters, the leaders condemned terrorism and said they were resolved to counter it together. “Under the shadow cast by the recent attacks in Paris, we stand in solidarity with the people of France and all victims of terrorism elsewhere,” the statement draft said. Obama said he and Australia’s Turnbull also discussed ramping up pressure on Islamic State. He is likely to discuss the friction over the South China Sea and military relations when he meets Philippine President Benigno Aquino on the sidelines of the summit on Wednesday. Aquino and Japan’s Prime Minister Shinzo Abe are also expected to agree on a deal paving the way for Tokyo to supply Manila with used military equipment, possibly including aircraft that could be deployed to patrol the South China Sea, sources said. Separately, Manila and Hanoi signed a strategic partnership deal on Tuesday to agree on how their navies will work together.