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A South China Sea cauldron in 2020?

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China's Liaoning aircraft carrier with accompanying fleet conducts a drill in an area of South China Sea, December 2016 (Photo: Reuters/Stringer).

In Brief

If events in the South China Sea (SCS) in 2019 provide any indication of what is in store for the coming new year, there seems to be little to be sanguine about.

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One might have thought that the standoff between China and Vietnam in 2014 over the oil rig HYSY981 would be the last major incident, especially following the Permanent Court of Arbitration (PCA) award two years later. ASEAN and Beijing injected further impetus into the process for a Code of Conduct (CoC), reaching a draft framework in 2017 and a Single Draft Negotiating Text (SDNT) in 2018, representing noteworthy progress.

But the standoff between China and Vietnam over the Vanguard Bank in the southern Spratly Islands in July and November 2019 shattered this illusion. All concerned parties continue to express their willingness to engage in dialogue, albeit each having its own reason for doing so. Negotiations should rightfully take place in an atmosphere where mutual confidence and trust can be engendered.

This was not the case in 2019. The Vanguard Bank incident demonstrated that China has no qualms about utilising coercion to assert its SCS interests while at the same time engaging in talks. China’s actions in Vietnam’s exclusive economic zone (EEZ) showed that its revisionist nine-dash line claim,  invalidated by the PCA award, remains alive and well. Most importantly, it showed that Beijing would not tolerate challenges to its interests.

During the 18th ASEAN–China Senior Officials’ Meeting in Da Lat in October 2019 Hanoi expressed its profound displeasure at Chinese actions hindering its legitimate energy work within its EEZ. This might have helped terminate the Vanguard Bank standoff. This episode could have heaped pressure on ASEAN member states who do not wish to see a stymied CoC process, which in turn could have influenced China’s decision to withdraw its survey ship Haiyang Dizhi 8.

The Da Lat meeting was a reminder of how Hanoi may leverage its newfound position as the ASEAN chair for 2020 to throw obstacles in the way of the CoC process. These obstacles could put the credibility of Beijing’s professed intent to promulgate the code by 2021 — an intent supported by many ASEAN governments — at risk.

2020 could see a mellowed-down China which is preoccupied with festering domestic problems ranging from economic slowdown as a result of the trade war with the United States to turmoil in Hong Kong. But Beijing will not completely foreswear the use of coercion.

In a recent meeting, China and Vietnam agreed to ‘handle differences properly’ — a familiar refrain which has characterised bilateral communications for years, including during the aftermath of the 2014 standoff. But given that HYSY981 and Vanguard Bank happened despite such previous assurances, similar future flare-ups are to be expected. Beijing will be careful in choosing targets. But Vietnam holds some useful cards in its pocket such as the ASEAN chairmanship in 2020 and a capacity to bring legal actions such as litigation.

Despite the economic slowdown that may affect ongoing build-up programs, existing military and coastguard capacities still afford China the resources to maintain a robust physical presence and, if necessary, conduct active coercive exercises in the SCS. Chinese government vessels continue to remain vigilant to the activities of the ASEAN claimants, particularly Malaysia’s energy work around the South Luconia breakers off Sarawak.

Optimists hoped that the CoC would dampen the recurrence of such incidents. ASEAN and China have two years to produce a tangible outcome before the 2021 deadline. 2020 will be interesting to watch, especially the subsequent reading of the SDNT which may give a sense of what the final document will look like. This process will still be marked by upheavals, since it is unlikely that all concerned parties will desist in asserting their SCS interests.

Extra-regional parties with economic and strategic interests in ensuring access to the SCS will play a prominent ‘background role’. The United States is expected to continue its freedom of navigation operations (FONOPs). US Navy Admiral Phil Davidson, Commander of the US Indo–Pacific Command made clear recently that the United States ‘will maintain our position and our operations in the South China Sea to preserve the international access to that waterway’. This means FONOPs will continue into 2020, a constant reminder to ASEAN and China that freedom of the seas should not be compromised in the CoC.

This may create concerns about a possible military confrontation between China and the United States. Despite the strategic rivalry playing out over trade, 5G technology, Xinjiang and Hong Kong, Beijing and Washington have generally maintained stable military relations — a breach of which could represent a final frontier and bring already strained ties into a disastrous tailspin. But both capitals sought to ease tensions following their last SCS close encounter in September 2018. This shows that both Washington and Beijing do not entertain the prospect of military confrontation. They are likely to maintain this position in the coming new year.

As China and ASEAN continue to engage in the CoC negotiations in 2020, the SCS situation will remain tenuous. There may not be any serious flare-ups since none of the concerned parties will wish to be seen as a spoiler of the CoC process. But expectations should be relaxed — progress will likely depend upon the extent to which all parties can compromise on their interests in the SCS.

Swee Lean Collin Koh is a Research Fellow at the Institute of Defence and Strategic Studies, the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore.

This article is part of an EAF special feature series on 2019 in review and the year ahead.

One response to “A South China Sea cauldron in 2020?”

  1. COMMENT
    Swee Lean Collin Koh – like all analysts including myself – writes good– sometimes great pieces – and some that are not so good. This piece falls in the latter category. It is superficial, slanted against China, and based on some false assumptions.
    First, contrary to the ‘straw man’ Koh sets up there were few analysts that had the “illusion” that the situation was going to get better. There really was –and is– no realistic reason why it would. The parties are not going to agree to a robust, binding COC primarily because its content has become caught up in the soft power contest between China and the U.S. for dominance in the region. But Koh does add a surprising twist – that Hanoi may “throw obstacles in the way of the COC process” to spite China. If it does, it will ensure that the negotiation process will be even more drawn out and the COC’s content further diluted.
    But the most basic flaw in his piece is that he assumes that China’s actions in Vietnam’s claimed EEZ and continental shelf are based on its claim to its discredited nine-dash line claim.
    This may not be so. China might have a legitimate claim to part of Vietnam’s claimed EEZ and continental shelf. It could argue that technically, the Philippines – China arbitration panel ruling on the legal status of the Spratly features applies only to the features examined and named by the panel– and it does not apply to the Paracels—at least not directly.
    China claims among others the fourth largest feature in the Spratlys – Spratly—which lies about 200nm to the north east of Vanguard Bank and is occupied by Vietnam. The status of Spratly was not examined or determined by the arbitration panel. If China owned the Spratly feature and it was ruled a legal island, it could generate a 200 nm EEZ and a continental shelf extending as far as 350 nm. Boundaries between China and Vietnam would need to be established. Ordinarily, such a boundary would be closer to the island than Vietnam’s mainland. Indeed, precedents suggest that an opposing island would get very little EEZ and shelf versus a mainland. But that is unknown and to be determined in this specific case.
    According to the U.S., Vietnam uses an excessive baseline that extends its EEZ and continental shelf in this area further than allowed by UNCLOS. https://2009-2017.state.gov/documents/organization/58573.pdf Moreover, equitable principles would play a role in boundary delimitation– and that is a crap shoot. For example, China might argue that it has the greater need for the resources based on its greater population. As long as the status of Spratly is unknown and until a boundary is determined, the area is disputed and according to the Guyana-Suriname precedent, neither country should unilaterally proceed with exploitation. https://academic.oup.com/jids/article/10/1/160/5133609; http://legal.un.org/riaa/cases/vol_XXX/1-144.pdf This means China might argue that at least the eastern portion of Vietnam’s claims in that area is disputed and its request that Vietnam have Spain’s Repsol—and other foreign oil companies – – cease their exploitation activities in the area may be reasonable.
    China might also argue that the Paracels belong to China, that they are legal islands, and that they generate an EEZ and a continental shelf extending out to 350 nm. Those claims could encompass some of the northern part of the area in contention and again necessitate the establishment of boundaries. The previous arbitration result suggests that the Paracels may not generate EEZs or extended continental shelf. But again that is unknown – and at least some of the area could be legitimately disputed until an arbitration panel or an agreement decides otherwise.
    Both China and Vietnam may have legitimate overlapping claims to some of the same area. Vanguard Bank and the immediate surrounding area may well be eventually adjudicated to belong to Vietnam. But this has yet to be determined and this assessment does not extend to Vietnam’s entire claimed EEZ and shelf.
    Koh then speaks of Vietnam’s threat to “bring legal actions” against China. This is highly unlikely. Despite Vietnam’s righteous indignation, this case is more complicated than an egregious violation by China of Vietnam’s EEZ and continental shelf. Moreover, the decision for Vietnam’s leaders to pursue arbitration against China is more political than legal. They have to weigh those advantages and disadvantages.
    If its complaint passes the procedural hurdles and is finally victorious, the advantages are that it will satisfy Vietnam’s nationalists, recover some lost pride, credibility and legitimacy for the government, and bring international law to its side – for what that is worth in these days of increasingly raw power politics.
    But the disadvantages would seem to outweigh the theoretical advantages.
    First, even if the panel decides it has jurisdiction and that the complaint is admissible, Vietnam may not ‘win’ on all points. In other words, it is quite possible that Vietnam will lose part of its claimed EEZ and shelf. Second, even if it does ‘win’ on all points, the ruling cannot be enforced as we have seen with the Philippines-China arbitration result.
    Third, and perhaps most important, by ‘internationalizing’ the dispute, Vietnam will have alienated and angered its permanent giant neighbor with whom it must live into the indefinite future. It will likely suffer economically, politically, and possibly militarily. So Vietnam’s leadership would have to decide if it really wants to confront China on the international political stage.
    Such claims by China may not eventually be successful. And they would leave China open to charges that it is using UNCLOS when it helps it and ignoring it when it does not—like the U.S., Russia, and the U.K. But such claims based on the Spratly feature and the Paracels raise the possibility that there is a valid dispute over at least part of the area. In sum, Vietnam has the better legal argument for its claim to Vanguard Bank and part of the larger area in question. But politics may well trump legal “correctness” in Vietnam’s decision making.
    Finally, Koh waxes optimistic regarding avoidance of a military confrontation between China and the U.S. in the South China Sea. Of course neither wants that but they may well sleep walk into one. The heat that is stoking the South China Sea caldron is derived in good part from the fundamental struggle between China and the U.S. for dominance in the region and in particular in the South China Sea. Their differences over US Freedom of Navigation Operations and provocative, intelligence, surveillance and reconnaissance(ISR) probes in China’s EEZ are only symptoms of this struggle. China is developing what the U.S. calls an “anti-access/area denial strategy” designed to control China’s “near seas” and prevent or delay access by the U.S. military in the event of a conflict. The US response is to prepare to cripple China’s command, control, communication, computer and ISR systems. Thus both are trying to dominate the ISR sphere over, on and under China’s near seas. China and the U.S. are not likely to “compromise on their interests in the SCS.”

    Mark J. Valencia
    Adjunct Senior Scholar
    National Institute for South China Sea Studies
    Haikou, China

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