BOORSEE

TAIPEI, TAIWAN — A little more than a week after Beijing and Manila reached an agreement aimed at easing tensions in the South China Sea, the Philippines has accused Chinese coast guard vessels of fresh incursions, harassment and “aggressive maneuvers.” 

Analysts say the pressure campaign, which has stepped up in recent days, is part of Beijing’s attempt to test the United States’ commitment to support the Philippines. 

“They want to see how far they can push the Philippines under the new administration in the U.S.,” Ja Ian Chong, a political scientist at the National University of Singapore, told VOA by phone. 

In a statement released on social media platform X last Saturday, the Philippine coast guard said two vessels from the Philippine Bureau of Fisheries encountered “aggressive maneuvers” from three Chinese coast guard vessels while heading to Sandy Cay for a marine scientific survey last Friday. 

In one video released by Manila, a large Chinese coast guard vessel was seen moving within a few meters of one Philippine vessel. Another video showed a Chinese helicopter hovering above two inflatable boats carrying Philippine crew members.

Philippine coast guard spokesperson Jay Tarriela said the Philippine vessels were forced to suspend the scientific survey due to the “continuous harassment and the disregard for safety” shown by the Chinese coast guard.  

In response to Manila’s accusations, Beijing said Chinese coast guard vessels “thwarted” two Philippine vessels’ attempts to “land on” Sandy Cay, which China calls “Tiexian Reef.”  

“The vessels attempted to illegally land on the reef and conduct sand sampling. China Coast Guard [CCG] vessels lawfully obstructed the Philippine ships’ course and warned them away,” the Chinese coast guard spokesperson Liu Dejun said in a statement released last Friday. 

China views almost all of the South China Sea as its territory and is engaged in a series of disputes with several Southeast Asian countries, including the Philippines, that have overlapping claims over the strategic waterway.  

Apart from the incident near Sandy Cay, the Philippine coast guard said its vessels had successfully kept Chinese coast guard vessels from operating in waters near the coastline of the Philippines’ Zambales province since last Friday.  

“The Philippine Coast Guard [PCG] vessel has maintained the China Coast Guard vessel to keep a distance of 90-100 nautical miles away from the Philippines’ Exclusive Economic Zone,” said Jay Tarriela from the Philippine coast guard in a post on social media platform X on Sunday.

Then on Monday, the Philippine coast guard said its vessels were hindered by Chinese coast guard vessels while trying to recover the body of a dead Philippine fisherman from a Philippine fishing boat.  

The series of incidents comes more than a week after senior Chinese and Philippine diplomats vowed to settle territorial disputes in the South China Sea through dialogues during a bilateral consultation. 

Although the agreement has allowed the Philippines to conduct resupply missions to its forces near the disputed Second Thomas Shoal since late last year, some experts say the latest incidents are part of a bigger effort by Beijing to drive a wedge between Manila and Washington.   

“Beijing isn’t happy with Manila’s assertive stance in the South China Sea and its close ties with the United States, so [these factors] serve as convenient justifications for Beijing to try to push Manila in the South China Sea,” said Collin Koh, a maritime security expert at Singapore’s S. Rajaratnam School of International Studies.  

Despite the persistent Chinese aggression, Koh said some in Manila think the Philippines can maintain its current approach in the South China Sea since there is bipartisan support for a more assertive position against China in the U.S. and some Trump administration officials, including Secretary of State Marco Rubio and White House National Security Adviser Mike Waltz, have reiterated Washington’s “ironclad” defense commitment to the Philippines during interactions with their Philippine counterparts last week. 

“Manila appears to be more cautiously optimistic that it can maintain the current policy, knowing that there is U.S. backing for that,” he told VOA by phone.  

To counter Beijing’s pressure campaign, Don McLain Gill, a lecturer in international studies at De La Salle University in the Philippines, said it’s important for the Philippines and its allies, including the United States, to maintain close collaboration in areas such as joint maritime exercises. 

Since China is expected to “continue pressing the Philippines into submission with its grey zone operations, which are now shifting from low intensity to high intensity, this must be addressed with more robust presence operations between the alliance and like-minded partners, along with continued support in the Philippines military modernization in line with the Comprehensive Archipelagic Defence Concept,” he told VOA in a written response.  

With the Trump administration’s announcement to suspend new funding for almost all U.S. foreign assistance for 90 days, however, Chong in Singapore said Beijing may think there is a window of opportunity to pressure countries like the Philippines. 
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Washington — U.S. President Donald Trump signed a series of executive orders on Monday to remove diversity, equity and inclusion, DEI, from the military, reinstate thousands of troops who were kicked out for refusing COVID-19 vaccines during the pandemic, and take aim at transgender troops.

Earlier on Monday, Pete Hegseth, who narrowly secured enough votes to become defense secretary, referred to the names of Confederate generals that were once used for two key bases during his remarks to reporters as he entered the Pentagon on his first full day on the job.  

Trump signed the executive orders while flying back from Miami to Washington, D.C.

One of the executive orders signed by Trump said that expressing a “gender identity” different from an individual’s sex at birth did not meet military standards.

While the order banned the use of “invented” pronouns in the military, it did not answer basic questions including whether transgender soldiers currently serving in the military would be allowed to stay and, if not, how they would be removed.

Trump’s plans have been heavily criticized by advocacy groups, which say his actions would be illegal.  

“President Trump has made clear that a key priority for his administration is driving transgender people back into the closet and out of public life altogether,” Joshua Block, with the ACLU, said earlier on Monday.  

During his first term, Trump announced that he would ban transgender troops from serving in the military. He did not fully follow through with that ban  his administration froze their recruitment while allowing serving personnel to remain.  

Biden overturned the decision when he took office in 2021.  

The military has about 1.3 million active-duty personnel, Department of Defense data shows. While transgender rights advocates say there are as many as 15,000 transgender service members, officials say the number is in the low thousands.  

When Trump announced his first ban in 2017, he said the military needed to focus on “decisive and overwhelming victory” without being burdened by the “tremendous medical costs and disruption” of having transgender personnel.

Internal focus  

Hegseth has promised to bring major changes to the Pentagon, and he has made eliminating DEI from the military a top priority.  

Trump’s executive order on ending DEI in the military said service academies would be required to teach “that America and its founding documents remain the most powerful force for good in human history.”

The Air Force said on Sunday that it will resume instruction of trainees using a video about the first Black airmen in the U.S. military, known as the Tuskegee Airmen, which has passed review to ensure compliance with Trump’s ban on DEI initiatives.

Hegseth was warmly greeted on the steps of the Pentagon by the top U.S. military officer, Air Force General Charles Brown, whom Hegseth criticized in his latest book. Asked if he might fire Brown, Hegseth joked that he was standing right next to him.

“I’m standing with him right now. I look forward to working with him,” as he patted Brown on the back.  

 

Reuters has previously reported about the possibility of mass firing among top brass, something Hegseth repeatedly refused to rule out during his confirmation process.

Hegseth referred to Fort Moore and Fort Liberty by their previous names, Fort Benning and Fort Bragg, while speaking with reporters.

The names honoring Confederate officers were changed under former President Joe Biden as part of an effort to reexamine U.S. history and the Confederate legacy.

“I’m thinking about the guys and gals in Guam, Germany, Fort Benning and Fort Bragg,” Hegseth said.

Much of Hegseth’s focus at the Pentagon could be internal to the military, including making good on Trump’s executive order on bringing back troops discharged for refusing COVID vaccines.

Thousands of service members were removed from the military after the Pentagon made the vaccine mandatory in 2021.

US missile defense

Trump also signed an executive order that “mandated a process to develop an ‘American Iron Dome’.”

The short-range Iron Dome air defense system was built by Israel’s Rafael Advanced Defense Systems with U.S. backing, and it was built to intercept rockets fired by the Palestinian Islamist movement Hamas in Gaza toward Israel.

Each truck-towed unit fires radar-guided missiles to blow up short-range threats such as rockets, mortars and drones in midair.

The system determines whether a rocket is on course to hit a populated area. If not, the rocket is ignored and allowed to land harmlessly.

Any such effort would take years to implement in the United States. 
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Pentagon — New U.S. Defense Secretary Pete Hegseth promised more changes are coming to the country’s military before even walking through the doors of the Pentagon.

Hegseth, a decorated veteran and a former Fox News host, was greeted just outside the Pentagon by General Charles Brown, chairman of the Joint Chiefs of Staff, after arriving for his first full day of work.

Hegseth said serving as defense secretary was the honor of a lifetime, telling reporters that the Defense Department will operate at a faster tempo.

“The lawful orders of the president of the United States will be executed inside this Defense Department swiftly and without excuse,” Hegseth said. “We’re going to hold people accountable.”

Hegseth won Senate confirmation late Friday by a 51-50 vote, with Vice President JD Vance casting the tie-breaking ballot.

He was sworn in on Saturday and spoke Sunday with Israeli Prime Minister Benjamin Netanyahu in what the Pentagon described as an “introductory call.”

“We will be no better friend to our allies and no stronger adversary to those who want to test us and try us,” Hegseth told reporters Monday before entering the Pentagon.

He said that President Donald Trump is expected to sign additional executive orders on Monday impacting the military, including orders calling for a U.S. version of Israel’s Iron Dome missile defense system, the removal of all diversity, equity and inclusion (DEI) initiatives from the Pentagon, and the reinstatement of troops forced to leave the military after refusing to get the COVID-19 vaccination.

Hegseth also said the Pentagon will make sure Trump has all the resources needed to secure the U.S. southern border.

“Whatever is needed at the border will be provided,” the defense secretary said. “This is a shift. It’s not the way business has been done in the past.”

“The Defense Department will support the defense of the territorial integrity of the United States of America, the southern border, to include reservists, National Guard and active duty in compliance with the Constitution and the laws of our land and the directives of the commander in chief,” he added.

Asked about the fate of Afghans who worked alongside the United States before the U.S. withdrawal in August 2021, Hegseth said, “We’re going to make sure there’s accountability for what happened in Afghanistan and that we stand by our allies.”

Hegseth also deflected questions about whether he plans to fire the chairman of the joint chiefs of staff.

“I’m standing with him right now,” Hegseth said. “I look forward to working with him.”
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LONDON/SINGAPORE — Investors hammered technology stocks on Monday, sending the likes of Nvidia and Oracle plummeting, as the emergence of a low-cost Chinese artificial intelligence model cast doubts on Western companies’ dominance in this sector. 

Startup DeepSeek last week launched a free assistant it says uses less data at a fraction of the cost of incumbent players’ models, possibly marking a turning point in the level of investment needed for AI.  

Futures on the Nasdaq 100 slid almost 4%, suggesting the index could see its biggest daily slide since September 2022 later on Monday, if those losses are sustained. 

Those on the S&P 500 dropped 2%. Shares in AI chipmaker Nvidia fell more than 11%, rival Oracle dropped 8.5% and AI data analytics company Palantir lost 6.5% in pre-market trading.  

DeepSeek, which by Monday had overtaken U.S. rival ChatGPT in terms of downloads on the Apple Store, offers the prospect of a viable, cheaper AI alternative which has raised questions about the sustainability of the level of spending and investment on AI by Western companies, including Apple and Microsoft.  

From Tokyo to Amsterdam, shares in AI players tumbled. 

“We still don’t know the details and nothing has been 100% confirmed in regards to the claims, but if there truly has been a breakthrough in the cost to train models from $100 million+ to this alleged $6 million number this is actually very positive for productivity and AI end users as cost is obviously much lower meaning lower cost of access,” Jon Withaar, a senior portfolio manager at Pictet Asset Management, said. 

The hype around AI has powered a huge inflow of capital into the equity markets in the last 18 months in particular, as investors have bought into the technology, inflating company valuations and sending stock markets to record highs. 

Little is known about the small Hangzhou startup behind DeepSeek. Its researchers wrote in a paper last month that the DeepSeek-V3 model, launched on Jan. 10, used Nvidia’s H800 chips for training, spending less than $6 million – the figure referenced by Pictet’s Withaar. 

H800 chips are not top-of-the-line. Initially developed as a reduced-capability product to get around restrictions on sales to China, they were subsequently banned by U.S. sanctions. 

‘Sputnik moment’  

Marc Andreessen, the Silicon Valley venture capitalist, said in a post on X on Sunday that DeepSeek’s R1 model was AI’s “Sputnik moment,” referencing the former Soviet Union’s launch of a satellite that marked the start of the space race in the late 1950s. 

“Deepseek R1 is one of the most amazing and impressive breakthroughs I’ve ever seen — and as open source, a profound gift to the world,” he said in a separate post.  

In Europe, ASML which counts Taiwan’s TSMC, Intel and Samsung as its customers, dropped almost 7.5%, while Siemens Energy lost nearly 18%. In Japan, startup investor SoftBank Group slid more than 8%. Last week it announced a $19 billion commitment to fund Stargate, a data-center joint venture with OpenAI. 

Given the volatility, investors sought out safe-havens such as U.S. Treasuries, which pushed 10-year yields down nearly 10 basis points to 4.52%, while low-yielding currencies like the Japanese yen and the Swiss franc soared against the dollar.  

Big Tech has ramped up spending on developing AI capabilities and optimism over the possible returns has driven stock valuations sky-high. 

Nvidia alone has risen by over 200% in about 18 months and trades at 56 times the value of its earnings, compared with a 53% rise in the Nasdaq .IXIC, which trades at a multiple of 16 to the value of its constituents’ earnings, according to LSEG data. 

Nick Ferres, chief investment officer at Vantage Point Asset Management in Singapore said the market was questioning the capex spend of the major tech companies. 

Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management said: “The idea that the most cutting-edge technologies in America, like Nvidia and ChatGPT, are the most superior globally, there’s concern that this perspective might start to change.”  

“I think it might be a bit premature,” Ichikawa said. 
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