Constantin Sabet d’Acre

Professor Lee

The United States and East Asia: 1945 to Present

The South China Sea:

Potential for Conflict and Outlook for Peace

Introduction

For long, most of the islands in the South China Sea remained unmanned territories, where few

but those whose ships were wrecked would step foot. The situation has changed tremendously, and

from a territory that was long neglected, the islands of the South China Sea have become objects of

contention. In the past half Century, there have been multiple skirmishes in the area in between

different countries and the situation has always looked rather unstable. An interesting question to ask

oneself is thus whether or not we should expect conflict in the region in the near future?

To answer this question, we will first look at the different claims on the region and why the

region matters to the different claimants. We will then analyze the different elements that could lead to

conflict, and finally we will consider different de-escalation factors. We will conclude that a conflict in

the region seems unlikely unless the region goes through significant changes.

I) Claimants and why they make their claims

Before we can analyze why the region is important and how likely a conflict is, we will rapidly

look at the different claimants in the region and what they base their claims on.

A brief introduction to the international law of the seas is necessary to understand certain of the

claims. In 1994, the United Nations Convention on the Law of the Seas was ratified.1 It contained several

important provisions including the fact that it allowed countries to have Exclusive Economic Zones (EEZ)

that extended 200 miles away from their coast. It also gave countries the sovereign right to exploit

economic resources above their continental shelf and gave countries full sovereignty over territorial

waters, delimited by a distance of 12 miles away from the shore.

1 http://www.imo.org/dynamic/mainframe.asp?topic_id=1514&doc_id=7602

Brunei and Malaysia both base their claims for a part of the South China Sea on UNCLOS. Brunei

does not claim any of the islands, yet it claims a 200 mile EEZ. Malaysia’s claims are more ambitious as

they are based on the right to an EEZ, as well as the continental shelf principle.2

Other countries base their claims on a mixture of legal backings and other reasons. The

Philippines originally claimed a part of the South China Seas on the basis of the principle of first

discovery. Indeed, they argued, and still do today, that Thomas Cloma, a Philippino explorer,

“discovered” a number of uninhabited islands in the South China Seas in 1947, and thus that it was

justified for him to claim these for the Philippines. The country has then strengthened these claims

based on the EEZ and the continental shelf principle.3 Vietnam’s extensive, yet not well-defined, claims

on the region are also based on both, history and international law. Vietnam has used historical

evidence from Vietnamese presence in the Paracels in 16th Century, and the incorporation of the

Paracels into Vietnam in 18024 to justify its claims. In addition, Vietnam also bases its claims on the

continental shelf principle.5

While all the countries we have looked at so far based their claims, at least partially, on

international law, the Chinese and Taiwanese claims are entirely based on history. The PRC and Taiwan

both claim all of the Spratlys, the Paracels and approximately 80% of the South China Sea 6 on the

principle of first discovery.7 Both the PRC and Taiwan claim to have historical evidence of past Chinese

involvement in the region, including but not limited to, traces of Chinese naval expeditions in the region

going back to the Han dynasty8 and of the presence of fishermen. Indeed, looking at a map of the

2 Ryan Holliway and Denise Youngblood, Global Guide, Spratly Islands. Accessed at

http://www.countrywatch.com/facts/facts_default.aspx?type=text&topic=SESPI 3 Ralf Emmers, Geopolitics and Maritime Territorial Disputes in The South China Sea, Routledge, 2010, p68 4 ibid, p67 5 Ryan Holliway and Denise Youngblood, Global Guide, Spratly Islands. Accessed at

http://www.countrywatch.com/facts/facts_default.aspx?type=text&topic=SESPI 6 Ralf Emmers, Geopolitics and Maritime Territorial Disputes in The South China Sea, Routledge, 2010, p71 7 ibid, p66 8 Marwyn Samuels, Contest for the South China Sea, Methuen, 1982, p22.

region, it seems clear that UNCLOS would not play in favor of the two countries if they wanted to lay

claims on a part of the region.

To summarize, six different countries have claims on parts of the South China Sea. These claims

are backed by international law or historical arguments. Before we can analyze with greater depth the

different potential sources of conflict and of peace in the region, we need to understand why the region

is important.

Despite appearances of being nothing more than coral reefs and small uninhabitable islands, the

Spratlys and other islands of the South China Sea are actually extremely valuable for two key reasons.

The first is that they are located in a strategic location. In the early 19th Century, Yang Ping-nan, a

Cantonese intellectual, wrote a geography of the region and noted that the Spratly Islands act “as the

screen (outer protection) for An-nan [Vietnam].”9 A century and a half later, during World War II, the

Japanese were able to control traffic in the South China Sea thanks to a submarine base they had

established in Taiping Island. They then used this base to launch their invasion of the Philippines.10

Closer in time, the Philippines have argued that the relative proximity of the islands that they claimed to

the Philippines justified the strategic importance of that subset of the Spratly Islands.11 The strategic

location of the region is undeniable.

In addition to the security aspect of the South China Sea, the region is important because of the

extensive amount of ships that pass through it. Every year “more than 50 percent of the world’s annual

merchant fleet tonnage crosses through the Malacca, Sunda, and Lombok straits, with the majority

continuing in to the South China Sea”12 and 25% of the world’s tanker traffic passes through the South

China Sea. In a 1998 interview, Blas Ople, chairman of the Philippine’s Senate Foreign Relations

9 Yang Ping-nan, Hai Lu, written 1820-1842, vol 3, 211-312 in Marwyn S. Samuels, Contest for the South China Sea,

1982, p38 10 Kam C. Wong, Who owns the Spratly Islands: the Case of China and Vietnam, China Report 38, 2002, p347 11 RP notes of protest to Vietnam, China, the Times Journal, (Manila), February 9th, 1974 12 Ralf Emmers, Geopolitics and Maritime Territorial Disputes in The South China Sea, Routledge, 2010 , p77

Committee explained that “[the South China Sea] is the lifeline of Japan and the East Asian economies

because the oil from the Middle East flows through the Indian Ocean through the South China Sea.”13 In

the case of China, in 2005, 80% of the country’s oil imports came through the Malacca Straits and the

South China Sea.14 The region is thus crucial for strategic reasons to all the claimants, and China in

particular.

Strategic considerations are not the only ones that come into play here. The region has a very

high economic value. Presence of oil is clear although the quantity is unknown. While the US Energy

Information Administration says there are only 7 billion barrels of proven reserves, Zhang Dawei from

China’s Ministry of Land Resources claimed there are in between 168-220bn barrels. Similarly, experts

have agreed on the presence of natural gas in the region, yet estimates range from 35 trillion Cubic Feet

according to a Western estimate to 2000 trillion cubic feet according to Zhang Dawei. 15 While energy

resources are an important part of the region’s economic value, there is more to it. The value of the

fishing industry in the South China Sea is very high. Jane’s intelligence review estimates that fishing in

the region could be “more commercially significant than oil.”16 To that, one must add the large guano

industry, or manure, which is also an important source of economic interest.

We have thus seen that the claimants have interests in the region both because of its strategic

location and the security implications of it, as well as because of the economic interests attached to it. In

light of the region’s importance, can we expect a conflict over possession of the islands?

13 M. D. Vitug, Mischief in the Spratlys, Newsweek Pacific Edition, December 21, 1998 14

Xuegang Zhang, China’s Energy Corridors in Southeast Asia, China Brief, February 4, 2008, Vol. 8, Issue 3.

Accessed at

http://www.jamestown.org/programs/chinabrief/single/?tx_ttnews[tt_news]=4693&tx_ttnews[backPid]=168&no_cache=1 15 Ralf Emmers, Geopolitics and Maritime Territorial Disputes in The South China Sea, Routledge, 2010 , p77 16 ibid, p77

II) Potential sources of conflict in the South China Sea

There are numerous reasons that could lead to conflict. Knowing the importance of the region

for all the claimants, as described above, one can easily imagine a conflict could erupt over the disputed

territories.

On top of the strategic and economic value of the South China Sea, the region is also very

important for the claimants because of the national pride that comes from the claims in the region. The

political costs for any of the claimants to retract its claims, thus giving away a piece of their country to a

foreign country, in order to help improve peace prospects in the region, would be terribly high. 17

A good example of such nationalism occurred in December 2007. At that time, China elevated

the administrative bureau in charge of the Spratlys and the Paracels, thus showing the country’s

commitment to the islands. That was very poorly received by countries in the region, most notably in

Vietnam where protests occurred in front of the Chinese embassy and consulate in Ho Chi Minh City.18

The protests were partially organized by the government, yet they show that the issues at hand are

sensitive enough topics to bring people to the streets. Thus, a potential rise of nationalisms could lead

countries to push harder for their claims.

Another important element that could lead to conflict in the region is the progressive shift in the

regional balance of power due to China’s rise. Currently, China does “not yet possess the technology,

military capabilities, and power projection to impose a naval hegemony in Southeast Asia.”19 Similarly,

the other claimants, which are all weaker than China, do not have sufficient military power to extend

their claims without fear of consequences.20 This helps keep the situation under control, because China

cannot extend its military possessions in the region without fearing repercussions. But, China has been

17

Ralf Emmers, Geopolitics and Maritime Territorial Disputes in East Asia, Routledge, 2010, p101 18 ibid, p101 19 ibid, p103 20 Ralf Emmers, The De-escalation of the Spratly Dispute in Sino-Southeast Asian Relations, in Sam Bateman and Ralf Emmers, Security and International Politics in the South China Sea, Routledge, 2009, p136

building up its military consistently, and it will likely reach a point where it will be able to act as a naval

paramount power in the South China Sea.

Most recently, fears of China’s growing military presence in the region have resurged. China is

today the world’s second largest spender on military expenditures in absolute terms.21 It has also made

certain moves in developing its military which are threatening to the other claimants. In 2008 it was

discovered that China was building a submarine base in Hainan that could host up to 20 nuclear

submarines.22 This has led to strong reactions on the part of other interested parties. Vietnam reacted

by agreeing with Russia to acquire 6 Kilo-class submarines. Malaysia and Singapore have also ordered

more submarines. Singapore started operating its first one. In addition, the US has resumed submarine

patrols leaving from Guam, a practice which had been discontinued since the end of the Cold War.23 It is

obvious from the reaction of all these countries to Chinese military developments that continued growth

of China’s military capability in the region could become a source of tension, and maybe even conflict.

All in all, there are potential factors that could lead to conflict. Not only is the region very

important to all the claimants for strategic and economic resources, claimants could also enter into

conflict because of excessive nationalism. In addition to that, conflict could arise because the delicate

balance of power in the region could be upset as China’s military capabilities grow.

21 Stockholm International Peace Research Institute, http://www.sipri.org/research/armaments/milex/resultoutput/15majorspenders 22 Thomas Harding, Chinese Nuclear Submarine Base, Telegraph.co.uk, May 1, 2008. Accessed at http://www.telegraph.co.uk/news/worldnews/asia/china/1917167/Chinese-nuclear-submarine-base.html 23 Edward Wong, Chinese Military Seeks to Extend its Naval Power, The New York Times, April 23, 2010. Accessed at http://www.nytimes.com/2010/04/24/world/asia/24navy.html?pagewanted=all

III) De-escalating factors and the likelihood of continued peace

Yet, conflict in the region is not inevitable. There are many factors that contribute to

maintaining peace in the South China Sea. Among those are improved regional relationships, notably

due to China’s foreign policy and changing perceptions of it, joint exploration of mineral resources, and

US presence.

The most important element in the de-escalation of tensions in the region has been the

improvement of regional relationships. This can, in large part, be attributed to changes in China’s stance

in dealing with the other claimants. These Chinese foreign policy changes are not specific to the region,

but rather express China’s new desire to have a better image internationally. Most notably, China

intends to show that it is not a threat, thus diminishing the “China threat” theory.24 To do so, it has

worked on using its soft power, through “culture, ideology and institutions,”25 as defined by Joseph Nye,

to change foreign perspectives of China.

There are many reasons for China to desire improved relationships with its neighbors. Among

these is the Chinese Communist Party’s priority to promote growth. In the words of Mark Beeson: “for

the political leadership of the PRC, economic security is arguably at least as important as conventional

sovereignty.”26 Indeed, the survival of the current political regime in China would be compromised if it

failed to deliver economic growth to its people.27 This is very relevant when looking at the countries

involved in the contest for the South China Sea. In 2008, trade in between China and ASEAN totaled

almost $200 billion. In addition, China and ASEAN entered into a free trade agreement that year to

24 Bonnie Glaser and Melissa Murphy, Soft Power with Chinese Characteristics: The On-going Debate, in Carola McGiffert, Chinese Soft Power and its Implications for the United States, a report by the CSIS Smart Power Initiative, March 2009, p12 25 Joseph Nye, Bound to Lead, Basic Books, 1990, p32 26 Mark Beeson , Hegemonic transition in East Asia? The dynamics of Chinese and American power, Review of

International Studies, 2009, 35, p102 27 ibid

further increase their trade.28 China also sees interest in maintaining good relationships with ASEAN

because of the energy resources present in the region. For example, there are notable amounts of

energy reserves in Indonesia that can be exploited at low costs.29 Thus, by economic interest and in

order to maintain political legitimacy, the Chinese government is not inclined to see conflict erupt with

any of the ASEAN members. Similarly, ASEAN members would not want to see trade with China be

harmed by conflict, and there is thus strong interest on both sides to cast sovereignty claims aside to

safeguard economic benefits.

Notable signs of China’s desire to improve relationships with the region include the signing of

the Declaration on the Conduct of parties in the South China Sea. Signed by ASEAN members and the

PRC in 2002, it did not contain a binding Code of Conduct, but still served to show China’s goodwill in

working towards peace in the region. Indeed, in the agreement freedom of passage was reaffirmed and

the parties agreed to try to solve disputes peacefully.30 A year later, China was the first non-ASEAN

country to join the Treaty of Amity and Cooperation, making the resolution of disputes through peaceful

means a legal obligation.31 These efforts from China to get involved in multilateral organizations led to

the soothing of a previously stranded relationship in between the PRC and ASEAN members.32 China’s

efforts have led to serious progress in perceptions of the country in the region. It is now “viewed as a

status quo rather than as a revisionist power.”33 This has promoted stability in the region.

Improved relationships and newfound stability have stopped the claimants from unilaterally

making a move towards owning more territory or natural resources through military power.34 Rather,

28

Liz Gooch, Asia Free-Trade Zone Raises Hopes, and Some Fears About China, New York Times, December 21, 2009. Accessed at http://www.nytimes.com/2010/01/01/business/global/01trade.html 29 Li Mingjiang, China’s South China Sea Dilemma, in Sam Bateman and Ralf Emmers, Security and International Politics in the South China Sea, Routledge, 2009, p143 30 Sheldon W. Simon, Whither Security Regionalism?, Strategic Asia 2003-04, 2004, p283 31

Nguyen Hong Thao, The Declaration on the Conduct of Parties in the South China Sea, in Sam Bateman and Ralf Emmers, Security and International Politics in the South China Sea, Routledge, 2009, p211 32 Ralf Emmers, Geopolitics and Maritime Territorial Disputes in East Asia, Routledge, 2010, p101 33 ibid, p103 34 ibid, p101

they have started looking for methods to cooperate with regards to resource exploration. Thus, the Joint

Marine Seismic Undertaking (JMSU) was signed in March 2005 in between China, Vietnam and the

Philippines.35 The agreement would lead China National Offshore Oil Corporation, Vietnam Oil and

Philippine National Oil Company to combine strengths in resource exploration. Other similar agreements

appeared, such as the Workshop on Marine Ecosystems and Biodiversity. 36 All these cooperation

initiatives should help promote peace by tying the countries’ interests together.

However, this is a tricky situation. Indeed, what would happen if large amounts of natural

resources were found? How would these be shared? Can a negotiated agreement be reached or will

China, who needs these resources so critically in light of the rapid growth of its demand for energy,

attempt to take control of the resources without consideration for the other weaker claimants? While

there is no answer to what would happen in such scenarii, these cooperation agreements still seem to

be steps towards a lasting peace.

In addition to the tightening of the relationships among the different claimants, the US also has

an important role in maintaining peace in the region. While historically the US has not taken a stand

with regards to the territorial claims, it does have military ties with many of the claimants. For example,

Vietnam and the US have conducted many joint military exercises together. 37 The US and the

Philippines are engaged in a treaty of mutual assistance in case of attack.38 More recently, Hillary Clinton

proclaimed in her visit to ASEAN “we’re back,”39 implying a renewed US commitment to reengage with

35

ibid, p103 36

Nguyen Hong Thao, The Declaration on the Conduct of Parties in the South China Sea, in Sam Bateman and Ralf Emmers, Security and International Politics in the South China Sea, Routledge, 2009, p215 37

Li Mingjiang, China’s South China Sea Dilemma, in Sam Bateman and Ralf Emmers, Security and International Politics in the South China Sea, Routledge, 2009, p146 38 One must note that the US is not bound to help the Philippines in case of attack because it is bound to “meet the common dangers in accordance to its constitutional processes.” In other words, if Congress turns down a vote to intervene militarily, the US will not have to help with the country’s defense. See: http://www.boundaries.com/US-Asia.htm 39 Peh Shing Huei, Can the US Take on China in Asia, The China Post, March 16, 2010. Accessed at http://www.chinapost.com.tw/commentary/the-china-post/special-to-the-china-post/2010/03/16/248484/Can-the.htm

ASEAN. This renewed commitment can be attributed in large part to a desire to contain China in the

region. A direct implication from it is an increased military presence in order to counter China’s growing

forces. As we’ve mentioned earlier, the US responded to news of the Hainan submarine base by

dispatching submarine patrols to the South China Sea. To summarize, the US’ military presence in the

region serves as a check to growing Chinese power. Indeed, China cannot act militarily without

expecting a reaction from the US.

In addition to increased military presence, the US has also increased its presence in Southeast

Asia through diplomacy. This increased role has several sources. Amongst these are the US’ desire to

have a higher profile in the region, and pressure from US allies such as Japan and Singapore to get more

involved in the region in order to counter China’s growing influence.40 Thus, the US has started involving

itself more in multilateral organizations with ASEAN members in order.

All in all, improved regional relationships and the presence of a US counterweight to China’s

growing influence should help maintain peace in the region.

Conclusion

We have seen that claimants over a part of the South China Sea all base their claims on

legitimate, yet very different, arguments. The region being of strategic importance, it is unlikely they will

relinquish their claims in the future. In addition, excesses in nationalism and a shift in the regional

balance of power towards China could lead to conflict in the region.

However, there are numerous factors that allow us to believe peace will be maintained in the

South China Sea. It is in the best interest of all the claimants to maintain peace in order to avoid

economic losses due to damaged trade and investment flows. This has led to smoothened relationships

in between the claimants, and improved multilateral initiatives. In addition, the US presence in the

40 Robert Sutter, The Obama Administration and US Policy in Asia, Contemporary Southeast Asia: A Journal of International and Strategic Affairs, August 2009, Volume 31, Number 2, p210

region serves as a counterweight to China, which helps diminish fears coming from the less powerful

claimants.

If the situation in the South China Sea does not change radically, we can expect the relationships

in the region to improve. An interesting question for further analysis would be to look at what changes

would have the potential to disrupt the current status quo to such an extent that conflict would ensue?

Potential triggers could be a nationalistic uprising in one of the claimants, or the US leaving the region,

thus radically shifting the balance of power. A more in depth analysis would be a great topic for a follow-

up paper.