By Greg Torode and Manuel Mogato

HONG KONG/MANILA (Reuters) - The Philippines may have won an emphatic legal victory over China in the South China Sea, but the aptly named Mischief Reef shows just how hard it will be for Manila to make its triumph count in the strategic waterway.

Chinese construction on the reef, which began two decades ago as a few rickety shelters perched on stilts, now covers an area larger than 500 football fields. It includes a 3 km (9,800 feet) runway, extensive housing, parade grounds and radar nests, satellite images show.

According to Tuesday's landmark ruling, however, the reef and everything on it legally belongs to the Philippines and no amount of time or building will change that.

Publicly, Manila has been unusually cautious in its response to the sweeping ruling, urging "restraint and sobriety". In private, officials acknowledge they have little hope of recovering Mischief Reef any time soon despite the unequivocal ruling by the Permanent Court of Arbitration in The Hague.

"This will take time, not in the next five or 10 years," said one senior Philippine navy official, requesting anonymity to speak freely on the highly sensitive matter.

It was, he said, "impossible to evict the Chinese there".


Beijing, which boycotted the case from the outset, says the ruling has no bearing on its rights in the South China Sea and has reasserted it claims to Mischief and other features.

On Thursday, the state-run People's Daily ran a picture on its front page of a civilian aircraft landing at the new Mischief airport, two Chinese flags rippling from the cockpit.

"As I've said before, it won't have any effect," Chinese foreign ministry spokesman Lu Kang said, when asked if China would seek to bolster its sovereignty over Mischief Reef.

"At the same time, I want to stress that if any person wants to take the outcome of this arbitration as a basis for taking any provocative steps against China's interests, China will most certainly resolutely respond," Lu told reporters.

With the panel having no powers to enforce its ruling, mainland experts see no sign that China will scale back its actions across the South China Sea.

"The tribunal's decision is so sweeping that it is not going to help solve the problem," said Sienho Yee, an international law specialist at China's Wuhan University.

Other Chinese experts, speaking privately, said the ruling was being closely scrutinized, despite official statements dismissing its relevance.

Some among leadership elites had been "stung" by its comprehensive stance against China.

"There is surprise at the extent of the sheer arrogance of these judges sitting (in Europe) deciding what is a rock and what is an island," said one Beijing-based scholar.

"It can only serve to unify our leadership and harden Chinese views, and that includes the military leadership. There will be little appetite to take a step back."

Manila's "softly, softly" approach reflected its understanding of that risk, Philippine officials said.

"We should find ways to allow some face-saving actions because China could face tremendous domestic pressure," the Philippine navy official said. "We don't want the Chinese Communist Party to be overthrown by the more hot-headed people in the People's Liberation Army. That will be too dangerous."

President Xi Jinping has moved extensively to tighten his grip on power since assuming office almost four years ago and there has been no sign of any such action.


The decision on Mischief Reef is among the most significant within the 479-page judgment from the panel, which looked at the territorial rights of disputed reefs, rocks and shoals scattered throughout the key trade route.

At a stroke, the court dismissed Beijing's 69-year-old nine-dash line claim to much of the South China Sea and removed any legal basis for Beijing to create a network of linked territorial and economic seas under its control, legal experts said.

Mischief is China's eastern most holding in the resource-rich waterway. Some 300 km (185 miles) west of the Philippines' island of Palawan and 1,100 km (685 miles) from China's Hainan Island, it sits entirely within the Philippines' exclusive economic zone and on its continental shelf.

The panel ruled China's building of installations on reclaimed land, which accelerated sharply after 2014, was illegal and had "aggravated" the dispute under the U.N Convention on the Law of the Sea, under which Manila launched the case in 2013.

The judges backed Philippines' lawyers who used satellite, survey and historical data, including Chinese naval pilot notes, to show Mischief Reef is - legally at least - nothing more than seabed exposed at low tide.

The lawyers gave evidence that its traditional Chinese name - Mi Qi Fu - was based on Mischief's English name, according to court transcripts, seeking to undermine China's argument that it had been, in its words, "master" of the South China Sea for 2,000 years. China calls it Meiji Reef today.


Regional military officials and diplomats say Mischief is a clear flashpoint in what is expected to be months of tension after the ruling.

Others include Scarborough Shoal, a traditional Philippine fishing ground that was occupied by China in 2012, and Second Thomas Shoal, where a small group of Philippine soldiers is based in the rusting hulk of a grounded ship.

The United States is also watching Mischief closely and has repeatedly warned China against further development of islands within the waters of the Philippines, a formal security ally.

U.S. Republican Senator Dan Sullivan demanded on Wednesday that U.S. ships sail close to Mischief as part of pledged increases in so-called freedom-of-navigation operations.

A U.S. defense official also told Reuters that, if regional competition escalated into confrontation, U.S. naval and air forces were prepared to act to maintain free navigation.

Manila is clear it doesn't want to provoke China further.

"They are a bit angry now," Philippines' Defence Minister Delfin Lorenzana told Reuters. "Emotions are running high and we don't want to provide them any reason to react violently."

(Additional reporting by Ben Blanchard in BEIJING and Martin Petty in MANILA; Editing by Lincoln Feast)