Can China and the Philippines reach 2027 without a clash?
Two governments that own destroyers and missiles spent last month arguing about who hit whom with a wooden oar
On July 20, a China Coast Guard boat came alongside the BRP Sierra Madre, the Philippine Navy ship grounded at Second Thomas Shoal, and Philippine sailors launched two inflatables to move it away. Video showed the Chinese boat ramming one of them and then a scuffle with batons and oars. One Philippine sailor was struck on the head and hurt. Polymarket's China-Philippines clash market opened four days later at a 30.5% chance of another clash before January. We are betting on 'No' to earn 42.9%.
So, why would we bet against a clash? Well, almost nothing that happens counts according to the rules. The rule names gunfire, missiles, artillery, and melee weapons. Water cannon is not on the list. Ramming counts only if it opens a hull or sinks a ship, and scrapes and dents are ruled out by name.
Controversially, the China Coast Guard counts as a military force, while the Philippine Coast Guard does not, which is strange.
Last year there were three instances of a clash, but none of them would have paid according to the rules.
- A 30-minute water cannon attack near Scarborough Shoal in September that blew out a bridge window and cut a sailor's ear.
- A ramming near Thitu Island in October that wrecked navigation gear.
- Fishermen were hurt at Escoda Shoal in December.
Every one of them involved the coast guard, the fisheries bureau, or civilian boats, and not one would have paid a cent.
The only clear hull breach in the whole dispute was a hole in BRP Teresa Magbanua in August 2024, wide enough for a person to climb through. However, that ship belonged to the Philippine Coast Guard.
Which leaves the navy, and the navy has been in two of these encounters in 26 months. June 2024 and last month.
Both governments are talking the risk down:
- The Philippine armed forces said on August 11 that every action has to be "within established protocols".
- China's defense ministry said on August 14 its own conduct was "professional, restrained and beyond reproach".
- Manila chairs ASEAN this year and its foreign secretary said on Wednesday she is optimistic a South China Sea code of conduct closes in 2026.
Resupply runs to the Sierra Madre have gone 13 times without a dangerous encounter since July 2024. Two or three more fall before New Year. When examining the facts, it’s highly unlikely that those supply runs will encounter any problems in the upcoming months.
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