The Philippines is actively seeking capital, both foreign and domestic, to upgrade and expand infrastructure to meet burgeoning demand and compete with other fast-growing economies. This will address traffic and logistical constraints, as well as high power, water and telecommunications costs, a perennial complaint of investors.

The country has been easing restrictions on foreign investments. Shipbuilding, for instance, was recently opened for 100 per cent foreign equity investment. China, meanwhile, has emerged as the world’s second-largest outbound investor, a major infrastructure builder and major player in global mergers and acquisitions.

It is a reminder to the country of its own bitter episode in 2012, when its banana imports and tourism suffered as a result of a fishing incident over a disputed shoal that resulted to a two-month stand-off, leading Manila to initiate arbitration proceedings against Beijing in 2013.

The Hanjin case has triggered a national security review on foreign investment. But this raises questions about the consistency of such moves. Indeed, any arbitrary acts may lead Chinese companies to feel singled out, state-owned enterprises discriminated against and Chinese investments oversecuritised, if not overpoliticised.

This may not be the best signal to send, given the intense activity of state-led capital. It may also lead some to question why Chinese investors were welcomed in critical power transmission and telecommunications sectors but not for a shipbuilding plant. Thus, it is imperative for Manila to balance economic and security interests while showing consistency in drawing the line.

The Philippines has several options for addressing the Hanjin debacle. The government and local private sector could jointly take over the facility. Whether this signals state interest in entering the shipbuilding business is for the government to clarify.

Whether there are enough local players to absorb Hanjin’s expenses and sustain its operations at a time of gloomy prospects for the global shipping industry is another matter. The precedent this will set for other beleaguered sectors also cannot be ignored.

Another option is to diversify shareholding by inviting more local and foreign investors, in an effort to possibly dilute Chinese influence. The option of nationalising foreign and private investments with offers of compensation when deemed necessary should also be on the table.

For all the trouble caused by the Hanjin unit’s closure, there may be a positive side. It seems to have highlighted the need to review laws that deregulated and privatised state assets, as well as the contracts signed. This may ensure national security is not compromised in such commercial transactions, especially those involving public utilities and infrastructure. This makes for a salient issue as the country gears up for its midterm elections in May.

Lucio Blanco Pitlo III is a research fellow at the Asia-Pacific Pathways to Progress Foundation, a lecturer on Chinese Studies at Ateneo de Manila University and contributing editor (reviews) for the Asian Politics & Policy Journal. He also sits on the Board of the Philippine Association for China Studies