Fight or flight in the South China Sea

By David Brown

Lately China has exhibited symptoms of bipolar disorder in its approach to the thorny question of sovereignty over the South China Sea.

Addressing Southeast Asian counterparts last weekend, Chinese Defense Minister Liang Guangjie murmured familiar mantras about its outlook on the South China Sea: China will never seek hegemony or military expansion ... China is committed to maintaining peace and stability through security cooperation ... China unswervingly adopts the policy of forging friendly and good-neighborly relations.

In his bilateral contacts at a regional security dialogue in Singapore, Liang seemed intent on persuading members of the

 
Association of Southeast Asian Nations (ASEAN) to exclude the United States from discussions aimed at lowering tensions. Yet, scarcely days earlier, Chinese coast guard vessels were engaged in unprecedented thuggery against rival claimants to the 3.5 million square kilometers of ocean that stretch south from Taiwan to the Malacca Straits, activities Beijing describes as "regular maritime law enforcement and surveillance activities in the waters under the jurisdiction of China".

Four ASEAN states, Brunei, Malaysia, the Philippines and Vietnam, claim parts of this maritime area, claims based on application of the United Nations Charter on Law of the Sea (UNCLOS) rules on dividing up an enclosed continental shelf. Vietnam additionally asserts rights derived from its exploitation of the area's rich fisheries and seasonal occupation of certain islets rich in guano, abalone and sea cucumbers stretching back at least to the 1600s.

Though quick to claim its UNCLOS rights when that suits it, China treats the charter as irrelevant in respect to its "irrefutable jurisdiction" over the South China Sea. Up against a Law of the Sea Convention deadline to declare all maritime claims, in June 2009, China simply tabled a crude map and did not bother to address the geological and geomorphological criteria established by the convention.

Notwithstanding the broad signal that China is uninterested in compromise, ASEAN collectively has clung to the hope that Asia's emergent superpower can be persuaded to negotiate. They have but one success to show for that: in 2002, after years of trying, ASEAN nations at last persuaded China to sign on to a "Declaration on the Conduct of Parties in the South China Sea" or DOC. DOC signatories agreed to "exercise self restraint in the conduct of activities that would complicate or escalate disputes". Additionally, China forswore resort to force in the resolution of territorial claims.

The next step in the DOC process was to be agreement on modalities for settling the rival claims. So far, however, ASEAN hasn't been able to lure Beijing's negotiators back to the table. The Chinese insist that they never intended to settle who owns what in a multilateral forum but are ready to work things out in bilateral negotiations with other claimants. Meanwhile, Beijing has systematically been creating ‘facts on the ground' in support of its contention that it owns the whole South China Sea, right up to 12 miles off the coasts of littoral states.

In the northern part of the contested waters, China's bully boy tactics seem to have succeeded. Beijing has declared the Paracels, a group of reefs and islands that lies between its Hainan Island and Vietnam's central coast, now to be open for tourism and economic development by Chinese entrepreneurs. It ousted a small South Vietnamese force from the Paracels in 1974, and in recent years has all but driven Vietnamese fishermen from the surrounding waters. Hanoi clings doggedly to its claim, but its ASEAN partners show no signs of rallying in support.

That leaves the sprawling Spratly archipelago and an expanse of empty sea southwards of the Paracels - roughly, the southern two-thirds of the South China Sea - still up for grabs.

Incidents last month directed at non-Chinese fishermen and oil exploration ships in the Philippine and Vietnamese economic zones are new only in that they extend a now familiar pattern further to the south and closer to the coasts of rival claimants. Beijing has bluntly warned international oil companies against concluding exploration contracts in areas Vietnam claims as its EEZ. Manila sources report that Chinese naval forces are planting new outposts in Philippine territorial waters in defiance of the standstill required by the DOC.

The massive disconnect that has emerged between what China says and what China does gives General Liang's insistence at last weekend's Singapore forum that "the involved countries should resolve their disputes over maritime sovereignty through friendly negotiations and bilateral talks" a distinctly hollow ring.

What is driving China? Some analysts have speculated that policy incoherence is a temporary manifestation of rival power centers in Beijing. Others express confidence that the Chinese will not press their claims so hard or far that they alienate Indonesia, frighten businessmen or undo the US Pentagon's ambitions of military to military cooperation on a global scale.

More and more, though, these seem to be forlorn hopes. By all the evidence, China is playing for keeps and the prize is energy - the very significant oil and gas deposits believed to be awaiting discovery and exploitation beneath the seabed of the South China Sea.

One can argue - and petroleum geologists do - whether the oil and gas is really there, but it's beyond dispute that Beijing gives very high priority to securing energy supplies. China became a net oil importer in 1993; it now imports some six million barrels of oil a day, or some 60% of the oil it uses. By 2025, the Chinese economy will require oil imports on the order of 15 million barrels daily, according to BP's highly regarded annual review.

The situation is similar though less acute with regard to natural gas, reports BP. Beijing began to import liquefied natural gas in 2007, and by 2025 is expected to source 40% of its needs from abroad. For a nation willing to spend heavily to build a navy capable of protecting supply lines to the Middle East, the hydrocarbons presumably beneath the South China Sea must look irresistibly like low hanging fruit. According to the International Energy Agency:

The hydrocarbon resources of the South China Sea are little known. Several unconfirmed Chinese reports place potential oil reserves at 213 billion barrels, while the US Geological Survey (USGS) estimated reserves in 1994 at 28 billion ... Some experts believe that natural gas comprises the largest component of the South China Sea's hydrocarbon deposits, but estimates of this resource vary widely as well ...

The US Energy Information Agency comments thus:

The fact that surrounding areas are rich in oil deposits has led to speculation that the Spratly Islands could be an untapped oil-bearing province. There is little evidence outside of Chinese claims to support the view that the region contains substantial oil resources ... Due to the lack of exploratory drilling, there are no proven oil reserve estimates for the Spratly or Paracel Islands.

Is a fight inevitable?

The Vietnamese have no illusions about Beijing's readiness to provoke. Vietnam has been fending off Chinese attempts to bring them to heel for over a thousand years. Managing its unequal relationship with its northern neighbor is the core concern of Hanoi's foreign policy. To avoid war with the northern colossus, history suggests, the Vietnamese will kowtow but finally fight rather than capitulate.

A year ago, US Secretary of State Hillary Clinton declared the South China Sea a region of American "national interest" - a posture fully consistent with US objectives of free access in Asia going back to the 19th century , but in the context uttered, a slap in the face to the Chinese. Clinton's remarks were closely coordinated with Hanoi, host of the 2010 Asian Regional Forum (ARF) and garnished by a lot of bilateral talk about a new US-Vietnam strategic relationship. She suggested that the US could play a role as an honest broker in resolving the South China Sea claims.

Now, the US is on the spot to play that role. The 2011 ARF meeting is little more than a month away and will be chaired by Indonesia. The meeting will provide the best current opportunity for revitalizing a process that leads to a peaceful sorting out of rival maritime interests and claims.

It's possible to imagine a negotiated outcome that satisfies no one claimant fully but all sufficiently. That's an outcome with several essential elements: that ASEAN is able to hang together and the ASEAN member claimants can agree how to parcel out the Spratlys amongst themselves; that the US engages effectively on the side of common-sense accommodations including joint development in some areas; and, hardest of all, that China backs away from its preposterous claim to 100% ownership of the South China Sea.

At the defense ministers' forum last weekend in Singapore, US Secretary of Defense Robert Gates refused to be drawn out on the recent Chinese muscle-flexing, other than to say that he shared others' concerns and that there are multilateral mechanisms, ie the DOC and UNCLOS, that can be applied to resolve the issues relating to the South China Sea. Some reportage called this a sign that the Americans are pulling back from a confrontation.

That's probably a wrong interpretation. The immediate challenge for the Americans is to work with Indonesia to put the territorial issues on a track toward solutions grounded in international law and diplomatic common sense. They must reassure the Vietnamese and Filipinos that the US will not back down. They must persuade Chinese doves that whoever owns the Spratlys, there will be unimpeded opportunities for Chinese enterprises to participate in the exploitation of those hypothetical hydrocarbons.

Equally important, Washington ought to stand tough vis-a-vis China's hawks, putting Beijing privately on notice that provocative actions can only result in uniting other claimants, drawing the US further into the conflict and postponing the mutually beneficial development of the South China Sea's resources.

David Brown is a retired American diplomat who writes on contemporary Vietnam. He may be reached at nworbd@gmail.com.

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