By Yeganeh Torbati and Manuel Mogato
MANILA (Reuters) - U.S. Defense Secretary Ash Carter arrived in the Philippines on Wednesday to highlight strong and growing military relations with a crucial Southeast Asian ally as China assertively pursues its claims in the South China Sea.
Carter's visit comes as the two countries conduct joint military exercises and on the heels of an agreement that allows a U.S. military presence at five Philippine bases, one of which Carter plans to visit on this week's trip.
While the initial agreement allows for five bases, Carter told reporters while on the way to the Philippines that there would be more in future.
Defense officials from the Philippines and Vietnam will also meet this week to explore possible joint exercises and navy patrols, military sources said, shoring up a new alliance between states locked in maritime rows with China. [L3N17G2XK]
China claims almost the entire South China Sea, believed to have huge deposits of oil and gas. Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have claims to parts of the waters, through which about $5 trillion in trade is shipped every year.
The U.S. defense chief's visit also takes place weeks before a ruling is expected on an arbitration case the Philippines has brought against China in The Hague.
The United States believes that whatever the tribunal's decision, it will be binding on both China and the Philippines, but China has refused to recognize the case and says all disputes should be resolved through bilateral talks.
"The trip carries greater weight because of the impending arbitration ruling," said Patrick Cronin, senior director of the Asia-Pacific Security Program at the Center for a New American Security.
"Secretary Carter's task is to reassure the Philippines that it has U.S. security backing for a rules-based approach to settling disputes."
The United States has conducted what it calls "freedom of navigation" patrols in the area, sailing within 12-nautical mile territorial limits around disputed islands controlled by China to underscore its right to navigate the seas.
Those patrols have drawn sharp rebukes from China, but U.S. officials have said the United States will continue to challenge what it considers unfounded maritime claims.
U.S. officials say the Navy is carrying out more aggressive patrols in the region, sailing close to disputed features.
"They're sailing within 13, 14, 15 miles, without dipping into the 12-mile limit, and the Chinese have definitely noticed," said one U.S. official who was not authorized to speak publicly.
The official said Chinese ships were now shadowing every U.S. ship in the region, and routine ship-to-ship communications had become testier and sometimes unprofessional.
This year the United States is providing the Philippines with about $40 million as part of the five-year, $425 million Maritime Security Initiative (MSI).
That money will be used to train staff at the Philippines National Coast Watch Center, better enable the sharing of classified information between the U.S. and the Philippines, and buy better sensors for Philippine Navy patrol ships.
Swift progress on spending this year's MSI funds would enable the Pentagon to ask Congress for "multiples more" in funding for future years and possibly expand spending to Malaysia, Singapore, Indonesia, and Thailand, said Ernest Bower, chair of the Southeast Asia Advisory Board at the Center for Strategic and International Studies.
In the Philippines, Carter will observe annual U.S.-Filipino military exercises known as Balikatan. Around 4,400 U.S. troops are participating in the exercises, in addition to 3,000 Filipino troops.
(Additional reporting by Andrea Shalal and David Brunnstrom in Washington; Editing by Nick Macfie)