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 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 ageing 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.
ISLAMIC STATE THREAT
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.
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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.
(Additional reporting by Karen Lema, Megha Rajagopalan and Manuel
Mogato in MANILA, Michael Martina in BEIJING; Writing by John
Chalmers; Editing by Raju Gopalakrishnan)
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