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FILE PHOTO: Philippines Foreign Affairs Secretary Perfecto Yasay speaks during a news conference at the Department of Foreign Affairs in Pasay city, Metro Manila, Philippines July 27, 2016. REUTERS/Erik De Castro/File Photo


MANILA (Reuters) - The Philippines, seeking to improve relations with China, hopes a framework for a code of conduct in the disputed South China Sea will be completed by the middle of this year, its foreign minister said on Wednesday.

Foreign Secretary Perfecto Yasay said the code would help de-escalate tension in the waters, where China has started militarising artificial islands built after the Philippines filed an arbitration case against Beijing in The Hague.

The tribunal ruled last year in Manila's favour, rejecting China's claims to the waterway. But the ruling will not be on the agenda of this year's Association of Southeast Asian Nations (ASEAN) summit, a Philippine official said last week.

Philippine President Rodrigo Duterte reiterated last month he wanted to avoid confrontation with China and saw no need to press Beijing to abide by the ruling.

The code of conduct would make sure ASEAN and China follow legal and diplomatic processes in settling territorial disputes, Yasay said.

He said the ruling in The Hague may not have an effect on the code because Manila cannot dismantle the structures on the man-made island Beijing has built within its 200-mile exclusive economic zone.

"This is a matter that we will be raising with China at some future time in bilateral talks and," he said. "... Involving others in the discussion of this decision is just simply counter-productive for our purposes."

Chinese Vice Foreign Minister Liu Zhenmin said Beijing was negotiating with ASEAN to complete a framework draft in the first half of the year but warned the next stage of consultations would be "more arduous".

He said China and ASEAN were confident they could "safeguard peace and stability" and freedom of overflight and navigation in the South China Sea.

China claims most of the energy-rich South China Sea through which about $5 trillion in ship-borne trade passes every year. Neighbours Brunei, Malaysia, Taiwan and Vietnam also have claims.

(Reporting by Manuel Mogato in MANILA and Michael Martina in BEIJING; Editing by Nick Macfie)

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