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09.06.2016 | Is the South China Sea dispute set to escalate?

Tensions have been growing in the South China Sea ahead of an international tribunal ruling on Chinese territorial claims.

More than $5 trillion of maritime trade passes annually through the South China Sea, while countries in the region depend on its rich fishing grounds and are keen to exploit potentially huge oil and gas reserves. Such is its importance that maritime disputes have raged for years. 

China insists it has sovereign rights to 80 per cent of the sea, based on historical use by Chinese vessels. That corresponds to a loop stretching hundreds of miles, far exceeding the exclusive economic zones littoral states are granted by UN maritime conventions. The Chinese-claimed area encompasses the Paracel and Spratly Islands – little more than isolated reefs, rocks and atolls – with China recently turning some of them into naval bases through industrial-scale land reclamation. 

This has angered other countries bordering the sea, many of whose territorial claims overlap those of Beijing.  The disputes have led to confrontations at sea and occasional diplomatic rows.  Vietnamese and Philippine fishermen have long complained of harassment by Chinese ships in contested waters, and tensions peaked in 2014 when China deployed an oil rig off Vietnam’s coast, sparking anti-Chinese riots.  The incidents have fueled fears that Beijing is aiming to exert control over navigation and natural resources in the region.

While the US has no territorial ambitions in the South China Sea, under President Barack Obama it has developed a strategic interest in Southeast Asia, strengthening ties with several states, in particular Vietnam and the Philippines.  Washington is also committed to ensuring the sea remains open to international shipping, not least because about $1.2 trillion of American goods pass through it every year. In an effort to challenge China’s claims, the US has sailed warships close to Chinese-controlled islands on freedom of navigation patrols, and flown surveillance planes over the region. These actions have ratcheted-up tensions with Beijing.

Relations may worsen in advance of a ruling by an international arbitration court in The Hague on a case brought by Manila contesting  China’s seizure in 2012 of reefs and rocks off the Philippine coast, the Scarborough Shoal, as well as its ‘historic rights’ claim to the South China Sea. The court, due to deliver its verdict in the next few months, is widely expected to decide in favour of the Philippines.  Beijing officials have boycotted the proceedings, arguing the tribunal has no jurisdiction, so China will likely ignore an adverse judgment.

America has been concerned that if China loses the case, it will start building on the Scarborough Shoal or declare an Air Defence Identification Zone over the sea, requiring over-flying aircraft to identify themselves to the Chinese authorities. Senior US officials have warned such actions would be “provocative and destabilising”. But both sides are acutely aware of the risks of the dispute escalating. While they have accused each other of militarising the region, they are careful to avoid confrontation – although Obama has come under pressure from US military leaders and some in Congress to take a tougher line with China.

China, meanwhile, seems determined to assert its sovereignty over the South China Sea by creating ’facts on the ground’.  However, in a sign that it may be prepared to make some concessions, Beijing officials have responded positively to an offer from Philippines President-elect Rodrigo Duterte of bilateral talks on resolving their maritime differences. In contrast to the previous administration’s troubled relations with China, Duterte appears to have adopted a more conciliatory approach in order to encourage investment and economic cooperation. It is too early to say whether the proposed dialogue will be productive, but in the short term it could help reduce regional tensions.