China’s President Xi Jinping and Philippines President Rodrigo Duterte have pledged to progress a code of conduct that aims to lay down a framework for potential joint exploration in disputed areas of the South China Sea, writes Amanda Battersby.

The Asian nations have agreed to form of an intergovernmental joint steering committee and an enterprise working team aimed at finally kick-starting exploration that would be undertaken without either ceding sovereignty.

Xi, speaking during Duterte’s official visit to China last week, described the code as a creative way to establish rules to resolve the South China Sea issue.

For years, this maritime dispute has effectively halted upstream operations in areas such as the Reed (Recto) Bank that are claimed by both China and the Philippines.

Xi called on the Beijing and Manila governments to work together, put aside differences and exclude external influences to focus on co-operation and development to safeguard regional peace and stability.

However, he shot down Duterte’s voiced assertion that the United Nations’ arbitration ruling on the maritime boundary dispute with China, which found in the Philippines favour, is “final” and “binding”.

Xi’s stance is simple — China is “not budging” from its oft-stated position of rejecting the ruling, which is not enforceable anyway.

The South China Sea is a strategic shipping route and is believed to hold significant potential hydrocarbon resources. It is claimed in all or part by Taiwan and mainland China, the Philippines, Vietnam, Malaysia and Brunei Darussalam.

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China and Philippines agree to cooperate