Philippine President Benigno Aquino said that the Huangyan Island dispute might soon be resolved as he gave assurances that discussions with China had taken a clearer direction.
"Our discussions with China have never stopped. There is direction now, whereas before the talks were not as clear. Now there appears to be some clarity in the talks," the president told reporters on Monday.
"It's too early to say the situation has already cleared, but at least we are now moving nearer toward resolving the situation using diplomatic means," he said, adding that Foreign Affairs Secretary Albert del Rosario was given "terms of reference" by various legal consultants on how to resolve the issue.
Aquino also implied that it might not bring the case before international courts on the Law of the Sea, Philippine media said.
Tensions in the South China Sea escalated on April 10 when a Philippine warship harassed 12 Chinese fishing vessels that had sailed near the island to seek shelter from inclement weather.
Experts said Aquino's comments reflected that the Philippine side had softened its position. The Philippines is believed to have been under pressure from both the United States and its own people, said Ren Yuanzhe, a researcher at China Foreign Affairs University.
China, through Defense Minister Liang Guanglie's visit to the United States and the Sino-US strategic and economic dialogue that recently ended, has informed the United States of its position in the South China Sea, and the United States does not want to see the situation deteriorate, he said.
The Philippine people have also put pressure on their government out of fear that trade prospects would be negatively affected if tensions intensified, and it would be a disaster for ordinary citizens, Ren said.
China is the third-largest trade partner of the Philippines, and the Philippines is China's sixth-largest trade partner among ASEAN members. Bilateral trade grew fast over the past decade and reached $30 billion in 2011, according to the Chinese embassy in the Philippines.
Chinese Foreign Ministry spokesman Hong Lei on Tuesday repeatedly stated that the Chinese government has sought to resolve the dispute through diplomatic negotiations and urged the Philippine side to respect China's territorial sovereignty over Huangyan Island and return to the right track.
Ren said each party should learn from this incident and consider establishing a crisis management mechanism for the South China Sea to avoid potential conflicts.
Also on Tuesday, China Southern Airlines, one of the three major Chinese airlines, announced that it is cutting flights to the Philippines as tourist numbers have shrunk amid tensions over Huangyan Island.
The company will reduce its flights between South China's Guangzhou city and Manila to just once a day on certain dates from May 26 to June 30. The airline normally operates two flights daily on the route.
A spokesman for the airline said the adjustment was made in accordance with the cancellation of "a large number of tourist groups" lately.
Major Chinese travel agencies canceled tours to the Philippines earlier this month after the Chinese Embassy in the Philippines warned Chinese citizens of "massive anti-China demonstrations". The Chinese tourism administration on Sunday said almost all Chinese mainlanders on group tours would leave the Philippines by Wednesday.