China and the Philippines agreed to address the South China Sea disputes "through friendly consultations and negotiations by sovereign states directly concerned", according to a joint statement released on Friday.
The statement, issued during Philippine President Rodrigo Duterte's state visit to China, highlighted "the importance of handling the disputes in the South China Sea in an appropriate manner".
"Both sides also reaffirm the importance of ... addressing their territorial and jurisdictional disputes by peaceful means, without resorting to the threat or use of force, through friendly consultations and negotiations by sovereign states directly concerned," the statement said.
The statement also says the two countries "agree to continue discussions on confidence-building measures to increase mutual trust and confidence and to exercise self-restraint in the conduct of activities in the South China Sea that would complicate or escalate disputes and affect peace and stability".
"In addition to and without prejudice to other mechanisms, a bilateral consultation mechanism can be useful, which will meet regularly on current and other issues of concern to either side on the South China Sea," the statement said.
Duterte's China trip, from Tuesday to Friday, is his first official visit to a foreign country outside ASEAN after assuming the presidential post in June. The visit took place amid a backdrop of deteriorating China-Philippines ties due to the unilateral filing of the South China Sea arbitration case initiated by his predecessor Benigno Aquino III against China.
According to the joint statement, the Philippines welcomes China's proposal to open a Consulate-General of the People's Republic of China in Davao.
The statement also laid the basis for China-Philippines cooperation in areas including infrastructure investment, finance and customs.
"Both sides will develop financial cooperation including in areas such as concessional loans, preferential buyer's credit, bonds issuance, loans, investments, securities, and others as mutually agreed upon including special loans for development," the statement said.
According to the statement, the two countries will strengthen cooperation in the Asian Infrastructure Investment Bank (AIIB) and other multilateral and regional development banks.
