Transactional Diplomacy in the South China Sea

Great power rivalries and regional spheres of influence are the subjects of constant debate, not least due to their economic and security consequences. Whilst it is tempting to look to forums such as the United Nations to measure changes in the balance of power, it is more practically useful to study the arenas in which de facto competition actually occurs. The South China Sea has become recently one of the most useful such situations, in which there is ongoing strategic competition between the People’s Republic of China and the United States of America for influence over the Pacific region and the rules-based international order more generally.

The rights of countries regarding nearby ocean territory is governed mainly by the United Nations Convention on the Law of the Sea (UNCLOS). Under this agreement, a country is entitled to territorial waters extending twelve miles from its coastline, and an Exclusive Economic Zone (EEZ) extending two hundred miles. Countries may enforce their own laws within territorial waters, though foreign civilian and military vessels have the right to ‘innocent passage’; this precludes such activities as military exercises and espionage. States have the further right to the exclusive exploitation of natural resources within their EEZs.

The South China Sea has been subject to competing claims of sovereignty for decades. Most prominent is the “nine-dash line" - a rough outline encompassing the vast majority of the Sea, first claimed by the Republic of China, and maintained by the People’s Republic after the former’s retreat to Taiwan. In accordance with this claim, China has begun to build civilian and military installations on various islands and reefs outside its EEZ. The “historic rights” which China claims in this area clash with the claims, territorial waters and EEZs of Brunei, Malaysia, the Philippines, Indonesia, and Vietnam. A tribunal of the Permanent Court of Arbitration in the Hague, instigated by the Philippines, found in July 2016 that there was no legal basis for China’s claims.

China’s behaviour in the South China Sea requires explanation. It would appear that trade security features highly in China’s calculations. Its navy is growing but is still weak - it possesses just one aircraft carrier, a refitted Cold War-era Soviet vessel - and in the event of a conflict, the United States could easily block its access to the west by denying passage through the straits of Hormuz and Malacca. China has taken other measures to improve trade security in this region, such as opening port facilities along the coasts of a host of other nations from Cambodia to Sudan (coined the “string of pearls" strategy), and by attempting to route trade over land to Pakistani ports (avoiding the South China Sea completely). While China’s behaviour so far supports the theory that it seeks greater trade security, the expansion of hard power resources in the region could equally be part of a longer-term strategy to gain influence as a major power. Many Pacific countries bordering the seas to the east and south of China are allied with the United States, with the Philippines being the major US ally in the South China Sea. The Chinese leadership may feel that, should it be possible for China to emerge as a global power to rival the US, it must dominate its immediate neighbourhood. The fruits of this strategy can be seen in the inclusion from June 2017 of India and Pakistan in China’s Shanghai Co-operation Organisation; additionally, since the Hague tribunal ruling last year, China has adopted an overtly friendlier tone when dealing with the Philippines and Vietnam.

The response of other countries in the region to China’s behaviour has come largely through the medium of the Association of South-East Asian Nations (ASEAN). This has not agreed on any tangible measures to resolve the South China Sea issue and has, since its first involvement in the late 1990s, only been able to produce a “code of conduct” framework, upon which future negotiations can take place. The United States’ response has been stronger: to condemn the building of military installations on reefs, and to conduct “freedom of navigation operations” (FONOPs) within the claimed twelve-mile territorial limit of certain islands and reefs. The purpose of these is not deterrent in nature, but is intended to uphold the legal principle of the right to innocent passage, and to prevent the lack of this becoming an accepted principle in international law.

Under the latter stages of Barack Obama’s presidency, the US Navy carried out two such operations each quarter, but the pace of FONOPs has slowed under the administration of Donald Trump. The first FONOP under President Trump came on 24th May, after a break of 214 days; the USS Dewey sailed within twelve nautical miles of an artificial island built on Mischief Reef in the Spratley Islands - a low-tide elevation not entitled to a territorial sea. The US Navy has proposed numerous such operations since Mr. Trump’s inauguration, but the vast majority of these have been prohibited by the Department of Defense.

It has been suggested that Mr. Trump’s administration intends to treat its diplomatic relationship with China as largely transactional, and that a reduction in FONOPs and other activity likely to displease the China’s leadership could help promote President Trump’s negotiating position on matters such as trade and North Korea.

If the slowing pace of the United States’ FONOPs is indeed due to a more transactional approach to diplomacy in Southeast Asia, this would be a grave mistake. The innocent-passage FONOPs which the US has been conducting defend only the bare minimum of international agreements.

Members of Mr. Trump’s administration have stated that China's building works and militarisation measures in the South China Sea are unacceptable; Rex Tillerson, the US Secretary of State, said in his confirmation hearing that the US should deny China access to bases on islands and reefs in the region, and this was echoed by White House spokesman Sean Spicer on 23rd January. There has so far, however, been no obvious action taken in accordance with this position.

Even though there is a clear focus in Mr. Trump’s administration on trade imbalances and the threat posed by North Korea, there is no good reason for the US to abandon its previous diplomatic relationship with China. China has cooperated with the most recent UN sanctions placed on North Korea, and has suspended coal imports from the state. It is not in the interest of China to allow its North Korean ally to provoke the US to the point where it would have to take measures beyond mere sanctions; the prospect of an unstable state pouring potentially millions of refugees into China’s poor north-east should be enough of a deterrent. Furthermore, in the South China Sea, it has been argued by some - such as the Chatham House expert Bill Hayton - that a “de-escalation” of the situation is in China’s wider interest too. For de-escalation to be possible, however, greater pressure needs to be brought on the country to end the militarisation of islands in the region; otherwise, there is no incentive for China to slow its current building activities.

For the maintenance of its own status as a global power and to uphold the principles of a rules-based international order, the United States should increase, rather than decrease, the intensity of its FONOPs in the South China Sea, in addition to addressing its failure to ratify UNCLOS in the Senate. It should consider further measures, such as high-seas FONOPs (e.g. the conduct of military exercises) within waters to which China has no legal claim. Otherwise, the US risks losing influence in the region. Already, Rodrigo Duterte, the president of the Philippines, has “set aside” the tribunal ruling against China, which was instigated by his predecessor, Benigno Aquino. Its Southeast Asian allies may not want to risk bringing greater pressure on China in the region, but for the US, this is the only option which would allow it to maintain its influence on a long-term basis.


Tim Foxley

OAG Analysis

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