EmergingmaritimerivalryinTheSouthChinaSea:

Territorialdisputes,sea‐lanesecurity,and

thepursuitofpower

PreparedbyDr.JingdongYuan

This document may not be fully accessible. For an accessible version, please visit http://www.international.gc.ca/arms-armes/isrop-prisi/research-recherche/intl_security-securite_int/Report-South_China_Sea.aspx

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EMERGING MARITIME RIVALRY IN THE SOUTH CHINA SEA: TERRITORIAL DISPUTES, SEA-LANE SECURITY, AND

THE PURSUIT OF POWER

Jingdong Yuan, Centre for International Security Studies

University of Sydney, Australia

Prepared for the International Security Research and Outreach Programme

International Security and Intelligence Bureau

Summer 2012

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PREFACE

The International Security Research and Outreach Programme (ISROP) is located within the Defence and Security Relations Division of The International Security and Intelligence Bureau. ISROP’s mandate is to provide the Department of Foreign Affairs and International Trade Canada (DFAIT) with timely, high quality policy relevant research that will inform and support the development of Canada’s international security policy in the areas of North American, regional and multilateral security and defence cooperation, non-proliferation, arms control and disarmament. The current ISROP research themes can be found at: http://www.international.gc.ca/arms-armes/isrop-prisi/index.

ISROP regularly commissions research to support the development of Canadian foreign policy by drawing on think-tank and academic networks in Canada and abroad. The following report, Emerging Maritime Rivalry in the South China Sea: Territorial Disputes, Sea-Lane Security, and the Pursuit of Power, is an example of such contract research.

Disclaimer: The views and positions expressed in this report are solely those of the author and do not necessarily reflect the views of the Department of Foreign Affairs and International Trade or the Government of Canada. The report is in its original language.

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PRÉAMBULE

Le Programme de recherche et d’information dans le domaine de la sécurité internationale (PRISI) fait partie de la Direction des relations de sécurité et de défense, qui relève elle-même de la Direction générale internationale de la sécurité et du renseignement. Ce programme a pour mandat de fournir au Ministère des Affaires étrangères et du Commerce international (MAÉCI), en temps utile, des études stratégiques pertinentes et de haute qualité qui permettent d’orienter et de soutenir l’élaboration de la politique canadienne en matière de sécurité internationale concernant la coopération nord-américaine, régionale et multilatérale en matière de sécurité et de défense, ainsi que la non-prolifération, le contrôle des armements et le désarmement. Les thèmes de recherches actuels du PRISI figurent à l’adresse suivante :

http://www.international.gc.ca/arms-armes/isrop-prisi/index

Le PRISI commande régulièrement des études à des groupes de réflexion et à des réseaux d’universitaires au Canada et à l’étranger afin d’appuyer l’élaboration de la politique étrangère canadienne. Le rapport sommaire suivant, intitulé, Rivalité émergente en mer de Chine méridionale : litiges territoriaux, sécurité des routes de navigation et quête de pouvoir, est un exemple de ce type d’étude.

Déni de responsabilité : Les vues et opinions exprimées dans le présent rapport sont exclusivement celles de l’auteur, et ne reflètent pas nécessairement la position du Ministère des Affaires étrangères et du Commerce international, ou celle du gouvernement du Canada. Le rapport est présenté dans la langue de rédaction.

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ExecutiveSummaryThe South China Sea dispute is again under the international spotlight. This authorobservesthattensionoversovereignty,resources,andnavigationintheSouthChinaSea,and growing rivalry over primacy in the Western Pacific, have led claimant states andoutsidemaritimepowers to engage in intensified activity, including: naming islands andfeatures;conductingmarinesurveyandexplorationactivities;staginghigh‐profilevisitsbyofficials;establishingadministrativeauthoritiesoverdisputedareas;exercising ‘maritimeenforcement’ evidenced by tussles over fishing grounds including harassment, detentionandimposingfinesonfishermen,whichincreasinglyresultinprolongedstand‐offsamongmaritimeenforcementagenciesand/ornavalunitsofclaimantstates;apparentincreasedfrequencyofactivemilitarysurveillanceandintelligencegatheringincloseproximityto,orin, coastal states’ exclusive economic zones (EEZ); and growing restrictions imposed onforeign military activities in coastal country EEZs, at times perceived to obstruct andendangernavigationandover‐flights,resultinginseriousincidents.

Atthecentreofthedisputesarethehardeningpositionsofanumberofclaimantstates.Atthesametime,thereisgrowingtensionbetweenarisingChina,poisedtoexercisegreaterinfluence in the region, and the United States as the ‘status quo’ power determined topreserveitspresenceinaregionofgrowingstrategicsalience.Simplyput,theSouthChinaSeaisbecomingapotentialflash‐point,bothbecauseoftheunresolvedterritorialdisputesamong claimant states, and also as a result of pending great‐power rivalry between theUnitedStatesandChina.

Divergentinterpretationsofinternationallaw,includingtheUnitedNationsConventionontheLawoftheSea(UNCLOS)provisionsforestablishingsovereigntyoverlandterritoriesincluding islands, in order to assert rights and jurisdiction over surrounding maritimespaceincludingexclusiveeconomiczonesandcontinentalshelf,haveaddedcomplexityanddifficultytothealreadyuntenableproblem.Freedomofnavigation,inparticular,hasbeenusedtotestthecontentofcertainrightsestablishedunderUNCLOS.

ManagingtheSouthChinaSeadisputerequiresbothadeeperunderstandingofthesourcesanddriversofconflicts,andthedevelopmentofmechanisms,inbilateralandmultilateralsettings, to address them.Given the critical sea lanesof communication, potential futureaccess to maritime resources, and unresolved territorial disputes, the capacity tounderstandandaddresstheseemergingsecuritychallenges,includingthedevelopmentofmechanisms for managing maritime crises and conflicts, have enormous policyimplicationsforallplayersinvolvedintheregion,aswellastheUnitedStates.

Thereport’spreliminaryfindingspointtoanumberofdriversincluding,butnotlimitedto:

Time‐lines for compliance with international legal provisions have arguablyreignitedcompetingclaimsto insular featuresandsurroundingwaters in theSouthChinaSea.Whilenoneof the contendingpartieshaveany realistic expectation thatthe dispute will be resolved any time soon, impending time‐lines may reinforcestrong incentives to present their case in the strongest andmost uncompromising

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termspossible,suchasthrough‘enforcement’activitiestobolsterclaims.

CompetinginterpretationsofUNCLOSwithregardtotheEEZandtheouterlimitsof the continental shelf beyond 200M, and coastal states’ jurisdiction oversurrounding maritime space, as well as differing interpretations of the scope ofmaritimepowers’rightsinfreedomofnavigation,haveresultedinhigherfrequencyofencountersnotgovernedbyanyrecognizedrulesoftheroadandthegreaterriskof future incidents, misunderstandings, and potential escalation to militaryconfrontation;

Nationaldevelopmentstrategiesandgrowingdependenceonimportsofresourcesandenergy, combinedwithestimatesofpotentially sizeableoil andgasdeposits inthe South China Sea, further elevate the importance of territorialwaters/maritimefeaturesforallclaimantstates;

Risingnationalism, leadership transition, and increasing assertiveness from themilitaries and maritime enforcement arms of the claimant countries provide thedomestic backdrops of uncompromising foreign policies in Beijing, Hanoi, Manila,among others; parochial institutional interests and the lack of central coordinatingmechanismshaveallowedsomesub‐nationalactorstopursuetheirownagendas,attimesunderminingnationalpoliciesandpriorities,aswellascommitmentsmadeininternationalfora;

ChangingdebateswithinChina and the growing consensus on the importance ofthepursuitof sea‐power status, includingasa ‘newhistoricalmission’ for thePLA,especiallyitsnavalarm;

Major geo‐strategic shifts and power re‐alignment in the region, as a result ofChina’s ascendancy to risingpower status andU.S. ‘re‐pivoting’ toEastAsiaafter adecade of ‘entrapment’ in twomajor wars in western Asia. Increasingly the SouthChinaSeabecomesabattlegroundwherecommandandcontrolofthecommonsis‘staked‐out’betweenthetwoprincipalcontenders;

TheimportanceoftheSouthChinaSeaasthecriticallinkbetweentheIndianOceanandWesternPacific,wheresealanesofcommunicationcarrythebulkofinternationaltradeaswellasprovidecruciallifelinesofenergyandresourcesupplies.

Navigating the South China Sea morasses and the changing regional geo‐strategiclandscapewillbeamajorchallenge incomingyears, including formajorpowerssuchasChinaand theUnitedStates.From theauthor’sobservations, scholarsandpolicy‐makersalikewillneedtotakeintoaccountthefollowingpreliminaryfindings:

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ChinahasconsistentlyuphelditspositionontheSouthChinaSea,althoughitsapproachestoaddressingdisputeshaveshiftedovertimeinresponsetounifiedpositionsfromitsinterlocutors(e.g.,whileChinainsistsonbilateralnegotiationonterritorialissues,ithasbeenopentomultilateraldiscussionsaslongastheypertaintothemanagement,notthesettlement,ofthedisputewhichBeijingclaimscanonlyberesolvedthroughbilateralnegotiations).

Regionalandmultilateraleffortsatdefusingtensions,andlookingforsolutions,havebeenhamperedbydisagreementsamongclaimantstates;

Morepositively,despitetheperiodicoccurrencesofdisputesandcontroversies,involvedpartieshavemanagedtocompartmentalizevariouselementsoftheirrelationshipssothatterritorialdisputesdonotspill‐overintootherareas,anddonotimpederegularandongoingdialogueandconsultation;

U.S.positionsonfreedomofnavigation,accesstoEastAsianmarkets,andtheabilitytoprovideassistancetoallies,hasbeen,andwillcontinuetobe,challengedbyChina,whichconsiderssuchapostureas,atminimum,unwelcomeand,atworst,hostile.

Washingtonhasbeen,andshouldremain,cautiousinitsapproachestotheSouthChinaSeaterritorialdisputes,notwithstandingitslong‐standingalliancearrangementsandincipientpartnershipswithsomeofthedisputingparties;

Theintroductionanddevelopmentofconfidence‐buildingmeasuresandincidentatseamechanisms,suchastheASEANDeclarationontheConductofPartiesintheSouthChinaSeaandassociatedimplementationguidelines,arecrucialinpreventingmaritimeincidentsfromescalatingintoadiplomaticcrisis,orevenmilitaryconfrontation.

Track‐IIdiscussionshaveyettogeneratepolicyresponsesandacceptanceofrecommendations;however,opportunitiesremainforpartiesconcernedtoseekwaystodefusetension,developcommonunderstandingofchallenges,andintroducenewmechanisms,bilateralormultilateral,toaddressthem;effectiveimplementationdependsongood‐faithcompliancecordoned‐offfromdomesticpoliticsandrisingnationalism.

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RésuméLe différend territorial en mer de Chine méridionale est de nouveau sous le feu desprojecteursinternationaux.L’auteurobservequelestensionssuscitéesparlesquestionsdesouveraineté,deressourcesetde lanavigationenmerdeChineméridionaleainsique larivalitécroissantepour laprédominancedans lePacifiqueoccidentalontamené lespaysprétendants à intensifier leurs activités dans la région: dénomination d’îles et d’entitésgéographiques; réalisation de levés marins et d’activités d’exploration; organisation devisitesdefonctionnairesdehautniveau;établissementd’autoritésadministrativessurdeszones litigieuses; conduited’«opérationsdepolicemaritime», commeen témoignent lesaccrochages dans les lieux de pêche, y compris le harcèlement, la détention et lamise àl’amendedepêcheurs, qui entraînentdeplus enplusde confrontation entre les agencesd’application des lois maritimes et/ou les unités navales des États prétendants;augmentationapparentedelafréquencedesactivitésdesurveillancemilitaireactiveetdecollectederenseignementsàproximitéimmédiateouàl’intérieurdeszoneséconomiquesexclusives (ZEE) des États côtiers; augmentation des restrictions imposées aux activitésmilitaires étrangères dans les ZEE des États côtiers, qui sont parfois perçues commeobstruantetmettantendangerlanavigationetlessurvolsetquiprovoquentdesincidentsgraves.

Au cœur des litiges se trouve le durcissement des positions des États prétendants.Parallèlement, on observe une tension croissante entre une Chine émergente, prête àexercer une plus grande influence dans la région, et les États‐Unis, puissance du «statuquo»,déterminésàpréserverleurprésencedansunerégiond’uneimportancestratégiquegrandissante.Entermessimples,lamerdeChineméridionalesetransformeenpoudrière,en raison d’une part des litiges territoriaux non résolus parmi les États prétendants, etd’autrepart,delarivalitélatenteentrelesgrandespuissancesquesontlesÉtats‐UnisetlaChine.

Les divergences d’interprétation parmi les États concernés du droit international,notamment des dispositions de la Convention des Nations Unies sur le droit de la mer(UNCLOS)visantl’établissementdelasouverainetésurlesterritoiresterrestres,ycomprissur les îles, en vue de faire valoir leurs droits et leur compétence sur l’espacemaritimeenvironnant, y compris les zones économiques exclusives et le plateau continental, ontexacerbé la complexité et la difficulté d’une situation déjà intenable. La liberté denavigation,enparticulier,aétéutiliséepourtestercertainsdroitsétablisdanslecadredel’UNCLOS.

LagestiondudifférendenmerdeChineméridionaleappelleunemeilleureconnaissancedessourcesetdesvecteursdeconflitsainsiquel’élaborationdemécanismesderèglementauseind’instancesbilatéralesetmultilatérales.Étantdonnélecaractèredéterminantdesvoies de communication maritimes, l’accès éventuel aux ressources marines et lesdifférendsterritoriauxnonrésolus,lacapacitédecomprendrecesnouveauxproblèmesdesécuritéetd’yfaireface,notammentparl’élaborationdemécanismespourlagestiondes

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crises et des conflitsmaritimes, revêt une importance stratégique énorme pour tous lesacteursengagésdanslarégionainsiquepourlesÉtats‐Unis.

Les conclusions préliminaires du rapport attirent l’attention sur un certain nombre devecteurs,dontlessuivants:

Les dates limites pour la mise en conformité avec les dispositions juridiquesinternationales pourraient avoir ravivé les revendications contradictoires sur lesentités insulaireset leseauxenvironnantesenmerdeChineméridionale.Siaucunedes parties prétendantes ne s’attend réalistement à ce que le différend soit résolurapidement, l’imminencedesdates limitespourrait les inciter fortementàdéfendreleurcausedelamanièrelaplusfermeetlaplusintransigeantequisoit,notammentenmenantdesactivitésd’«applicationdelaloi»pourappuyerleursrevendications.

Les interprétations divergentes de l’UNCLOS concernant la ZEE et le tracé deslimitesextérieuresduplateaucontinentalau‐delàdelazonedes200millesainsiquela compétence des États côtiers sur l’espace maritime environnant, et lesinterprétations divergentes de la portée des droits des puissances maritimes auchapitre de la liberté de navigation, se sont soldées par des affrontements plusfréquents non régis par les règles de la circulation navale et un risque plus grandd’incidentsfuturs,demalentendusetd’escaladejusqu’àuneconfrontationmilitaire.

Lesstratégiesnationalesdedéveloppementetladépendancecroissanteàl’égardde l’importation de ressources et d’énergie, associées à la présence éventuelle degisements appréciables de pétrole et de gaz naturel enmer de Chineméridionale,accroissentdavantagel’importancedeseauxterritorialesetdesentitésmarinespourtouslesÉtatsprétendants.

Lamontéedesnationalismes,lestransfertsdepouvoiretladéterminationaccruedes forces armées et des organes d’application des lois maritimes des paysprétendants servent de toile de fond aux politiques étrangères intransigeantes deBeijing,deHanoïetdeManille,entreautres;lesintérêtsinstitutionnelsàcourtevueainsique lemanquedemécanismesdecoordinationcentrauxontpermisàcertainsacteurs infranationaux de faire primer leurs propres intérêts, allant parmoment àl’encontredesprioritésetdespolitiquesnationalesainsiquedesengagementsprisauseind’instancesinternationales.

L’évolution des débats en Chine et le consensus croissant sur l’importanced’acquérir le statut de puissance maritime, y compris une «nouvelle missionhistorique»pourl’APL,particulièrementsonbrasnaval.

Lesimportantschangementsgéostratégiquesetleréalignementdespuissancesdanslarégion,parsuitedel’accessiondelaChineaustatutdepuissanceémergenteet de la «re‐focalisation» de l’attention des États‐Unis sur l’Extrême‐Orient, aprèsune décennie d’«enlisement» dans deux importants conflits armés en Asieoccidentale.LamerdeChineméridionaledevientdeplusenplusunchampclosoùle

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commandement et le contrôledes zones communes sontmonopoliséspar lesdeuxprincipauxprétendants.

L’importancedelamerdeChineméridionalecommeliencrucialentrel’océanIndienetlePacifiqueoccidental,dontlesvoiesdecommunicationmaritimesvoienttransiterl’essentielducommerceinternationaletassurentdesapprovisionnementsvitauxenénergieetenressources.

Lanavigationdans lesdédaleset lepaysagegéostratégiquerégionalchangeantde lamerdeChineméridionaleconstitueraundéfiimportantdanslesprochainesannées,ycomprispour les grandes puissances comme la Chine et les États‐Unis. Selon l’auteur, lesuniversitairesetlesdécideursdevronttenircomptedesrésultatspréliminairessuivants:

LaChineasystématiquementmaintenusapositionenmerdeChineméridionale,toutenmodifiantaufildutempssonapprocheenmatièrederésolutiondesdifférends,enréactionàlapositionuniqueaffichéeparsesinterlocuteurs(p.ex.,alorsquelaChineinsistepourtenirdesnégociationsbilatéralessurlesenjeuxterritoriaux,elleestouverteàdesdiscussionsmultilatéralesàconditionquecelles‐ciportentsurlagestionetnonlerèglementdesdifférends,lesquelsnepeuventêtrerésolus,selonBeijing,quepardesnégociationsbilatérales).

LeseffortsmultilatérauxetrégionauxenvuededésamorcerlestensionsetdetrouverdessolutionsontétéretardésparlesdésaccordsentrelesÉtatsprétendants.

Surunenotepluspositive,malgrél’apparitionintermittentededifférendsetdecontroverses,lespartiesconcernéesensontvenuesàcompartimenterdiversélémentsdeleursrelationspourfaireensortequelesdifférendsterritoriauxnesepropagentpasàd’autresdomainesetn’entraventpaslesconsultationsetlesdialoguesencours.

LespositionsdesÉtats‐Unisconcernantlalibertédenavigation,l’accèsauxmarchésest‐asiatiquesetleurcapacitéd’apporterdel’aideàleursalliésestetcontinuerad’êtreunirritantpourlaChine,quijugecespositionsaumieuxindésirablesetaupire,hostiles.

WashingtonestetdevraitresterprudentdanssonapprochedesdifférendsterritoriauxenmerdeChineméridionale,malgrésesalliancesdelonguedateetsespartenariatsnaissantsaveccertainesdespartiesopposées.

L’introductionetl’élaborationdemesuresdeconfianceetdemécanismesdepréventiondesincidentsenmer,commelaDéclarationsurlaconduitedespartiesenmerdeChineméridionaledel’ANASEetlesdirectivesdemiseenœuvre

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afférentes,jouentunrôleessentielpourempêcherquelesincidentsenmernedégénèrentencrisediplomatiqueoumêmeenconfrontationmilitaire.

Ledeuxièmevoletdediscussionsn’apasencoresuscitéderéactionspolitiquesnil’acceptationderecommandations;toutefois,lespartiesconcernéesonttoujourslapossibilitédechercherdesmoyensdedésamorcerlestensions,d’élaborerunevisioncommunedesproblèmesetd’introduiredenouveauxmécanismes,bilatérauxoumultilatéraux,pourlesrégler;leurmiseenœuvreefficientedépenddel’acquiescementdebonnefoidesparties,àl’abridespolitiquesnationalesetdelamontéedunationalisme.

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FullReportTheSouthChinaSeaisagainundertheinternationalspotlight.Forovertwomonthsnow,ChinaandthePhilippineshavebeenembroiledinheatedspatsoverthesovereigntyoftheScarboroughShoal.Asthisreportisbeingfinalized,thereisnosignthatthestandoffwillberesolvedany time soon.Meanwhile,Vietnam’s recentpassageof itsmaritime law, layingclaimtotheParacelandSpratlyIslands,hastouchedoffstrongprotestfromBeijing.Since2007‐08, tension has risen as some of the key contending states to the long‐standingterritorial disputes, principally China, Vietnam, and the Philippines, have reiterated andsought to strengthen their claims both through their interpretations of the 1982 UnitedNationsConventionontheLawoftheSea(UNCLOS),andbytakingmoreassertiveandattime aggressive actions to stake out their claims.1 These include naming the occupiedand/orclaimedislandsandfeatures;conductingmarinesurveyandexplorationactivities;staginghigh‐profilevisitsbyofficials;establishingadministrativeauthoritiesoverdisputedareas; exercising maritime enforcement with tussles over fishing grounds, harassment,detentionandfinesofotherclaimantcountries’fishermen;publicprotestsandthreateneddisruptions of oil extractions in the disputed territories; and imposing restrictions onforeign military activities in coastal country exclusive economic zones (EEZs), at timesobstructingandendangeringnavigationandover‐flightsresultinginseriousincidents.2ThereareanumberofimportantdriversbehindtheheightenedtensionsandcompetitionbetweenChina,itsneighbors,andothermaritimepowersoversovereignty,resources,andsecurity in the South China Sea.3 First, there is a need for coastal states to complywithArticle76of theUNCLOSrequiring the submissionof information to theCommissiononthe Limits of the Continental Shelf (CLCS) respecting the proposed location of the outerlimit of its continental shelf beyond 200 miles. This in turn has been driven by therecognition that continued economic development requires energy and resources,whichare shrinkingwithin their land territories andwhich have to be imported afar from theMiddleEast,Africa,andthePersianGulf.Thisrecognitionofthepotential limitstofuturegrowthhighlightstheimportanceoftheSouthChinaSeawithitsreportedrichdepositsinpetroleumandnaturalgas.Third,risingnationalismandtherevolutionincommunicationprovide accessible and increasingly influential platforms for public opinions that in turnaffectforeignpolicyformulation,makingconciliationdifficult.Atthesametime,economicgrowth and prosperity over the past two decades in East Asia provide the financialwherewithalformilitarymodernization,inparticularinnavalpatrolandpowerprojectioncapabilities.Fourth,forrisingpowerssuchasChina,thereisgrowingdebateandemerging

1 “Special Focus: The South China Sea Dispute,” Contemporary Southeast Asia 33:3 (December 2011). 2 Robert D. Kaplan, “The South China Sea Is the Future of Conflict,” Foreign Policy 188 (September/October 2011), pp. 76-85; Carl Ungerer, Ian Storey and Sam Bateman, “Making Mischief: The Return of the South China Sea Dispute,” Special Report, Issue 36 (Canberra: Australian Strategic Policy Institute, December 2010). 3 A general assessment of the nature and drivers of territorial disputes in the region can be found in Ralf Emmers, Geopolitics and Maritime Territorial Disputes in East Asia (London and New York: Routledge, 2010).

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consensus that sea power, even for continental countries, is the key to commanding theglobalcommonsandanessentialingredientofachievinggreat‐powerstatusinthefuture.4Andfinally,U.S.insistenceonfreedomofnavigationanditsrighttocarrymilitaryactivitiesin the South China Sea, including within coastal states’ EEZs, is increasingly beingchallengedbyChinaasitviewsU.S.surveillanceandintelligencegatheringaseriousthreatto its national security. This last point is becoming more contentious as China and theUnitedStatesfindthemselvesinmorefrequentmaritimeencountersintheWesternPacific.Granted,bothBeijingandWashingtonacceptthatfreedomofnavigationpertainstoareasof high seas and within the EEZs of states. However, the two countries hold differentinterpretationsof the scopeand thenatureof activities in theseareas, and theextent towhichsuchactivitiesareallowedunderinternationallaw.5ThesedevelopmentsaretakingplaceatatimeofamajorU.S.decisiontostrategicallyre‐orientateandre‐balancetoEastAsiaaftermorethanadecadeofretractionandnegligencelargelyduetoitspreoccupationwiththeAfghanandIraqiwars.Despitetheglobalfinancialcrisisof2008andasloweconomicrecoverythathaveleftWashingtonincreasinglyfocusedondomestic issuesand itsbudgetarywoes, including$487billion indefencebudgetcutsoverthenextdecade,theObamaAdministrationisdeterminedtomaintainandstrengthenits presence given the enormous stakes it has, both in strategic and commercial terms.6Over the past few years, Washington has strengthened its alliances with Tokyo, Seoul,Canberra, and formed closer partnerships with Hanoi, Manila, Jakarta, and New Delhi,througharmssales, jointmilitaryexercises,andbasingand trainingarrangements in theregion.7Washington is also becoming more explicit about its position on the South China Seaterritorial disputes. Speaking at the July 2010 ASEAN Regional Forum (ARF) foreignministers meeting in Hanoi, U.S. Secretary of State Hillary Clinton stated: “The UnitedStates, likeeverynation,hasanational interest in freedomofnavigation,openaccess toAsia’smaritimecommons,andrespectforinternationallawintheSouthChinaSea....TheUnitedStatessupportsacollaborativediplomaticprocessbyallclaimantsforresolvingthe

4 James R. Holms and Toshi Yoshihara, “The Influence of Mahan upon China’s Maritime Strategy,” Comparative Strategy 24:1 (2005), pp. 23-51.

5 James Kraska, “Sovereignty at Sea,” Survival 51:3 (June-July 2009), pp. 1-18; Andrew J. Norries, “The ‘Other’ Law of the Sea,” Naval War College Review 64:3 (Summer 2011), pp. 78-97.

6 Dan Robinson, “Obama Unveils Strategy for Smaller, Agile Future US Military,” Voice of America, January 5, 2012; Hillary Clinton, “America’s Pacific Century,” Foreign Policy 187 (November 2011), pp. 56-63. US Secretary of Defense Leon Panetta in his recent speech at the Shangri-la Asia Security Summit spelled out the US plan to deploy 60 percent of its naval forces to the Asia-Pacific region by 2020. Panetta, “The US Rebalance towards the Asia-Pacific,” June 2, 2012, Singapore, http://www.iiss.org/conferences/the-shangri-la-dialogue/shangri-la-dialogue-2012/speeches/first-plenary-session/leon-panetta/ 7 Craig Whitlock, “U.S. Eyes Return to Some of Southeast Asia Military Bases,” Washington Post, June 23, 2012; William Tow, “The Eagle Returns: Resurgent US Strategy in Southeast Asia and the Its Policy Implications,” Policy Analysis (Canberra: Australian Strategic Policy Institute, February 13, 2012).

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various territorial disputes without coercion. ... We encourage the parties to reachagreementonafullcodeofconduct.”8Meanwhile,China’sphenomenaleconomicgrowthoverthepastthreedecadeshasallowedittobuildupastrongermilitaryaswellasextenditsdiplomaticinfluenceinregionalandglobalaffairs.Beijinghasleverageditscharmoffensiveandsoftpowertowinfriendsandits active participation in multilateral security forums has reassured its neighbors.However, its hardened positions on territorial disputes andmore frequent and resolutemeasuresinenforcingitssovereigntyclaimsinrecentyears,anditsgrowingfrictionwiththe United States and other East Asian states have caused deep concerns among itsneighbours.9WillChina,withitsnew‐foundpower,expandinginterestsandambitions,andgrowingmilitary capacity, challenge the U.S. primacy and dominate others in East Asia?Willitresorttotheuseofforcetoenforceitsterritorialclaims?10Thisresearchreportwilldiscuss recent developments in territorial disputes, resource control, and navalcompetitionintheSouthChinaSeaandexaminethestrategicdriversandrationalesbehindrenewalinterestandrivalryforterritorialclaimsandmaritimesupremacy.TheRe‐EmergenceofTerritorialDisputesDisputesovertheSouthChinaSea,principallytheSpratlyand theParacel Islands,begantoemergeintheearly1970swhenitwasdiscoveredthatthisoceanareamaycontainsignificantoilandnaturalgasdeposits.ThescrambleforisletsintheSouthChinaSeafurtherintensifiedwiththesigning(1982)andentryintoforce(1994)oftheUnitedNationsConventionontheLawoftheSea(UNCLOS).Historically,ChinahasalwaysclaimedsovereigntyovertheentireSpratly Island groups that are partly or in whole also claimed by Brunei, Malaysia, thePhilippines,Taiwan,andVietnam,andovertheParacels,whichisalsocontendedbyVietnam.At themoment,Vietnamholds29 islands and features; thePhilippines, nine; China, seven,Taiwan,one,andMalaysia,five.IndonesianowhasuncontestedsovereigntyovertheNatunaIslandsinthesouthernpartoftheSouthChinaSeaand,asaresult,a200‐milezone(orevenshelfareabeyondthat)mayextendintowhatisunderstoodasbeingtheSpratlyIslandarea..Oneestimateoftheoceanareasdisputedbythevariousclaimantsisover2,045,000squarekilometers.11 In February 1992, China’s National People’s Congress (NPC), the country’sputative legislature, passed the LawofTerritorialWaters andContiguousZone that claimscompletecontroloverthelandfeaturesintheSouthChinaSeaandtheiradjacentwatersandassertsthatithaspowertoexercisejurisdictionoveritsterritories.12

8 “Comments by Secretary Clinton in Hanoi, Vietnam,” 23 July 2010, available at www.america.gov 9 Mark Beeson and Fujian Li, “Charmed or Alarmed? Reading China’s Regional Relations,” Journal of Contemporary China 21(73) (January 2012), pp. 35-52.

10 Aaron L. Friedberg, A Contest for Supremacy: China, America, and the Struggle for Mastery in Asia (New York: W.W. Norton, 2011). 11 Li Guoqiang, “What Does China Want in the South China Sea?” International Herald Leader, March 12, 2012. 12 Mark J. Valencia, China and the South China Sea Disputes. Adelphi Papers No. 298 (London: IISS, 1995); Valencia, “Building Confidence and Security in the South China Sea: The Way Forward,” in Andrew T.H. Tan and J.D. Kenneth Boutin, eds., Non-Traditional Security Issues in Southeast Asia (Singapore: Select Publishing for the Institute of Defence and Strategic Studies, 2001), pp. 528-569.

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The disputes over territorial claims have so far already resulted in twomilitary clashesbetweenChinaandVietnam(1974,1988).ChineseoccupationoftheMischiefReefin1995heightened tension between Beijing and Manila and stoked fear among its neighboringcountriesofthe“Chinathreat.”BeijingsubsequentlymoderateditsapproachandenteredintodialoguewithASEANonsecurityandterritorialissues.OnNovember4,2002,thetwosides signed the Declaration on the Conduct of Parties in the South China Sea, a majormilestone in China‐ASEAN relations. Specifically, the Declaration commits the signatoryparties “to exercise self‐restraint in the conduct of activities that would complicate orescalate disputes and affect peace and stability including, among others, refraining fromaction of inhabiting on the presently uninhabited islands, reefs, shoals, cays, and otherfeaturesandtohandletheirdifferencesinaconstructivemanner.”13WhileASEANwasnotabletogetBeijingtosignacodeofconduct,whichwouldbeamorestringentmeasure,thedeclaration at least obliged China to a multilateral approach to the issue, a shift frombilateralism that it hadpreferred. Itwas also symbolic in thatChinahadappeared tobeacceptingASEAN’spreferencefornormsandregulationonthedispute.TherenewedtensionandterritorialdisputesintheSouthChinaSea,especiallysince2007‐08, have been driven by a number of factors and have become increasingly complicatedbecauseoftheemergingissuesbeyondsimplyconcernsoversovereignty.Fishing,oil,andgreat‐power rivalrymake any solution evermore difficult and elusive.14 The immediatetriggerappearstohavebeendecisionsoftheMeetingofStatesPartiestotheLawoftheSeaprescribing May 13, 2009, as the date by which states party to UNCLOS, at the time itentered into force,were required to file either a submission or preliminary informationwiththeCommissionontheLimitsoftheContinentalShelf(CLCS).MalaysiaandVietnammade a joint submission in May 2009 regarding the proposed outer limits for theircontinentalshelvesbeyond200nauticalmiles.ThisprompteddiplomaticnotesofprotestsfromthePhilippinesandChina.InitsMay2009noteverbale,BeijingreiteratesitspositionthatChina “has indisputable sovereigntyover the islandsof theSouthChinaSeaand theadjacentwaters,andenjoyssovereignrightsand jurisdictionover therelevantwatersaswell as the seabed and subsoil thereof (see attached map). The above position isconsistently held by the Chinese Government, and iswidely known by the internationalcommunity.”15 China also attached to its diplomatic note a well‐known map with thecontestednine‐dashed line (theChinese call it the traditionalmaritimeboundary lineorchuantonghaijiangxian).

13 Leszek Buszynski, “ASEAN, the Declaration on Conduct, and the South China Sea,” Contemporary Southeast Asia 25:3 (2005), pp. 348-49. 14 Leszek Buszynski, “The South China Sea: Oil, Maritime Claims, and U.S.-China Strategic Rivalry,” The Washington Quarterly 35:2 (Spring 2012), pp. 139-156. 15 People’s Republic of China, Letter to the UN Secretary-General, Doc. CML/17/2009, May 7, 2009, cited in Michael Sheng-ti Gau, “The U-Shaped Line and a Categorization of the Ocean Disputes in the South China Sea,” Ocean Development & International Law 43 (2012), p. 58. See also, “Foreign Ministry Spokesperson Jiang Yu’s Regular Press Conference on January 5, 2010,” Ministry of Foreign Affairs of the People’s Republic of China, January 6, 2010, cited in Swaine and Fravel, “China’s Assertive Behavior Part Two: The Maritime Periphery,” China Leadership Monitor 35 (Summer 2011), p. 2.

15

Beyondthisrathervaguereference,therehasnotbeenanyexplicitexplanationfromeitherBeijing(orTaipeiforthatmattersincebothsharealmostidenticalclaims)onexactlywhatthislinemeans.AstheInternationalCrisisGroupnotesinarecentreport,“Chinahasyettopublicly clarify the legal status of the so‐called nine‐dashed line that appears on mostChinesemaps,encompassingmostoftheSouthChinaSea.”16TheU‐shapeddottedlinewasalso delineated in 1914 by the newly established Republic of China (ROC) and wassubsequentlyandofficiallydrawnbyROCin1947.Atthetime,noothercountryraisedanyissueaboutthedottedline.17Onelegalanalystpointsoutthatitisunknown“whetherwhatChina claims within the line is its national territory, including the islands, underwaterrocks,theseabed,andthewatercolumn.”WhileBeijinghasyettoexplainthefamousnine‐dashed line, arguably it has nonetheless emphasized in a nuancedmanner that the lineexistedforwelloverhalfacenturybeforetheUNCLOSimplyingthatChina’sclaimstoitsperceivedhistoricinterestswithinthelineshouldberespected.18

Source: Economist, May 19, 2012. Vietnamand other claimant states, understandably, challenge China’s sovereignty claimsbasedonthisnine‐dashedorU‐shapedline.HanoihasprotestedagainstChina’shistoricalrights,statingthatitwill“notrecognizeanyso‐called‘historicalinterests’whicharenotin

16 International Crisis Group, Stirring Up the South China Sea (I). Asia Report No. 223, April 23, 2012, Executive 

Summary. 

17 Peter Kien-Hong Yu, “The Chinese (Broken) U-shaped Line in the South China Sea: Points, Lines, and Zones,” Contemporary Southeast Asia 25:3 (2003), p. 407. 

18 Zou Keyuan, “China’s U-Shaped Line in the South China Sea Revisited,” Ocean Development & International Law 43 (2012), pp. 18-34, quote at pp. 18-19; Nguyen-dang Thang and Nguyen Hong Thao, “China’s Nine Dotted Lines in the South China Sea: The 2011 Exchange of Diplomatic Notes Between the Philippines and China,” Ocean Development & International Law 43 (2012), pp. 35-56.

16

consistent[sic]withinternationallawandviolatethesovereignty,thesovereignrightsofVietnamandVietnam’slegitimateinterestsinitsmaritimezoneandcontinentalshelfintheeasternSeaasmentioned inarticle14”ofChina’sEEZLaw.19Someanalystsholdsimilarpositions, arguing that China’s claims are weak against two principles—“effectiveoccupation”andtheUNCLOSrulesonEEZsandcontinentalshelves.20To some extent, UNCLOS has provided incentives for claimant states to extend andstrengthentheirphysicalpresenceinthedisputedterritories.SomeanalystspointoutthetendencyofclaimantstatestoinvokeandinterpretUNCLOStoeitherjustifyitsownactionsor to charge others ofmisbehavior.21 That said, Chinese responses and claims in recentyears are in line with its long‐standing positions on territorial issues and have not,according to some analysts, constituted additional claims; indeed, at a recent pressconference, theChinese foreignministryspokesmanmadethisstatement: “At thecoreoftheSouthChinaSeadisputearetheterritorialsovereigntydisputeoversomeoftheNansha[Spratly] Islandsandthedemarcationdisputeoverpartof thewatersof theSouthChinaSea.WhatshouldbepointedoutisthatneitherChinanoranyothercountrylaysclaimtotheentire South China Sea.”22 Nor has Beijing explicitly and deliberately elevated the SouthChinaSea territorialdisputes toa “core interest”as somemedia reportshavesuggested.Indeed,someChineseanalystsevenarguethatcharacterizingtheSouthChinaSeadisputeasthecountry’scoreinterestisnotawisemoveasitupsetstheneighboringcountriesandcouldraisethepotentialstakeinSino‐U.S.confrontation.23Anothermajorfactorinthere‐emergenceofterritorialdisputesintheSouthChinaSeaisthe growing importance of natural resources in the region for national economicdevelopment, including the exploration of deep‐sea petroleum and natural gas, fishinggrounds,and thesignificanceofmarineeconomy innationalGDP in termsofwealthandemployment. These considerations further elevate the importance of exclusive economiczones(EEZs)andcontinentalshelfbeyond200miles,bothofwhichflowfromsovereigntyoverlandterritory,includingislands.Vietnam,forinstance,hopestoearnmorethanhalfofits GDP through maritime activities such as fishing and petroleum by 2020. China’smaritimeeconomyalreadyrepresentscloseto10percentofitstotalGDP.24

19 Vietnam, “Dispute Regarding the Law on the Exclusive Economic Zone and the Continental Shelf of the People’s Republic of China which was passed on 26 June 1998,” Law of the Sea Bulletin no. 38 (1998), p. 55, quoted in Zou, “China’s U-Shaped Line,” pp. 26-27. 20 Buszynski, “The South China Sea,” p. 140. 21 Xavier Furtado, “International Law and the Dispute over the Spratly Islands: Whither UNCLOS?” Contemporary Southeast Asia 21:3 (December 1999), pp. 386-404. 

22 “Foreign Ministry Spokesperson Hong Lei’s Regular Press Conference on February 29, 2012,” Ministry of Foreign Affairs of the People’s Republic of China website, emphasis added. 23 Michael D. Swaine and M. Taylor Fravel, “China’s Assertive Behavior Part Two: The Maritime Periphery,” China Leadership Monitor 35 (Summer 2011); Li Hongmei, “Unwise to Elevate ‘South China Sea’ [sic] to Core Interest?” People’s Daily, August 27, 2010, http://english.peopledaily.com.cn/90002/96417/7119874.html; Edward Wong, “China Hedges Over Whether South China Sea Is a ‘Core Interest’ Worth War,” New York Time, March 30, 2011. 24 Will Rogers, “The Role of Natural Resources in the South China Sea,” in Patrick M. Cronin, ed., Cooperation from Strength: the United States, China and the South China Sea (Washington, D.C.: Center for a New American

17

Andtherecomesoil.FuelingChina’sfast‐growingeconomyhasbeenitsinsatiableappetitesfor raw materials and resources, in particular the energy.25 China became the secondlargest oil consumer in 2003 after the United States, overtaking Japan. According to USgovernmentestimates,China’soilconsumptionin2010stoodat9.189millionbarrelsperdayorbpd,outofwhichitsdomesticproductionwasonly4.273millionbpd,about46%ofthetotal.26Chinahasalsobecomeanetoil importingcountrysince1993,andnowranksthirdaftertheUnitedStatesandJapan.In2007,itimported3.19millionbpd,atenpercentincreaseover2006,whichamountedto46%ofitstotaloilconsumption,withthebalanceinimports.27Atthecurrentrateofgrowth(aroundeighttotenpercentannually),Chinaisprojectedtoimport7.1millionbpdby2015,and13.1millionbpdby2030,representing80percent of its projected oil consumption.28 With its own oil fields already matured andover‐drilled, its dependence on global oil supplies would likely continue to rise. Thisexplains why China’s national oil companies have been busy in securing oil supplies,developingoil fields in foreign countries, anddiversifying sourcesof suppliesbymovingintoAfrica,CentralAsia,andLatinAmerica.29This recognitionof thepotential limits to futuregrowthhighlights the importanceof theSouth China Sea. While estimates of known and recoverable petroleum and gas vary,nonetheless many claimant states are moving forward with plans to exploit theseresources,includingjointeffortswithforeigncompanies.30Becauseofoverlappingclaims,disputesinevitablyarise.AccordingtoChineseestimates,by2008,thefiveASEANclaimantstates(Vietnam,thePhilippines,Malaysia,Brunei,andIndonesia)hadcontractedover200foreign companies and operated 1,824wells in the disputedwaters,withmany of themwithin the so‐called nine‐dashed line and hence islands and waters claimed by China,producingoilandnaturalgasin8,400tonsofoilequivalentannually.31ChinafirstsignedSecurity, January 2012), pp. 85-97; Clive Schofield, ed., Maritime Energy Sources in Asia: Energy and Geopolitics (Seattle, WA: National Bureau of Asian Research, December 2011); Asia’s Rising Energy and Resource Nationalism, NBR Special Report, September 2011; Swaine and Fravel, “China’s Assertive Behavior,” p. 15. 25 International Crisis Group, China’s Thirst for Oil. Asia Report No. 153, June 9, 2008. 26 Central Intelligence Agency (CIA), The World Factbook: China, various years, at: https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html 27 CIA, The World Factbook: China; “Country Analysis Briefs,” Energy Information Administration (EIA), U.S. Department of Energy, August 2006, at www.eia.doe.gov/emeu/cabs/China/Background.html. 28 International Energy Agency, World Energy Outlook 2007: China and India Insights (Paris: OECD/IEA, 2007), p. 168. 29 Daniel Yergin, The Quest: Energy, Security, and the Remaking of the Modern World (New York: The Penguin Press, 2011), pp. 189-224; Michael T. Klare, Rising Powers, Shrinking Planet: The New Geopolitics of Energy (New York: Metropolitan Books, 2008), pp. 63-87; Ronald Dannreuther, “China and Global Oil: Vulnerability and Opportunity,” International Affairs 87:6 (November 2011), pp. 1345-1364; David Zweig and Bi Jianhai, “China’s Global Hunt for Energy,” Foreign Affairs 84:5 (September/October 2005). 30 The U.S. Geological Survey estimates oil reserves in the South China Sea to be approximately 3.78 billion tons, while Canada’s Husky Energy’s estimates, in collaboration with China’s CNOOC, put natural gas reserves near the Spratly Islands at approximately 170 billion cubic meters. Figures cited in NIDS China Security Report 2011 (Tokyo: National Institute for Defense Studies, February 2012), p. 21. 31 Xue Li, “Nansa nengyuan kaifa yu dongya zhenghe [Energy Development in the Spratlys and East Asian Integration],” Twenty-First Century, no. 10 (2011). On recent incidents in the South China Sea, see, Jeremy Page, “Beijing in Fresh Sea Row with Hanoi,” Wall Street Journal, March 1, 2012; Associated Press, “China, Philippines Exchange Barbs on Planned Oil, Gas Search in Waters Near South China Sea,” Washington Post, February 29, 2012.

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anagreementwithaU.S.company,Crestone,in1992,todevelopoilandgasinVanguardBank,anareaclaimedbyVietnamaspartofitscontinentalshelf.32Disputesoverfishingareanothermajordisputeamongtheclaimantstatesinrecentyears.Withthefishstocksdepleting,fishingvesselsincreasinglymoveinandoutofoverlappingclaim zonesmore frequently. Incidents such as detention of fishing boats and crew, andheavy fines becomemore frequent, further raising tension. Vietnam, for instance, claimsthat63fishingboatsand725fishermenhavebeendetainedbetween2005and2010.Thelatest incident involves 21Vietnamese fishermen and twoboats beingheld on an islandneartheParacelsbytheChineseenforcementmaritimeauthorities,whichdemand$11,000fortheirrelease.HanoialsochargesthatChinesepatrolboatshavecutoffVietnameseoilexploration cables.33 Likewise, Chinese fishermen also face detention as their vesselsventureintoothercountries’EEZs.Onesuchcaseinvolved75Chinesefishermendetainedby Indonesian authorities for alleged illegal fishing in the latter’s EEZs. As China’s fishstocks have depleted due to overfishing, Chinese fishermen are forced to go beyond theimmediate littoral.34 The ongoing stand‐off between China and the Philippines over thesovereigntyoftheScarboroughShoal(HuangyanDaoinChineseandPanatagShoalbythePhilippines)isjustthelatestepisodethathighlightstheseeminglyintractablenatureofthedisputes,andthescramblefordiminishingfishstocksthathaveledfishermenfromthetwocountriestoventureintodisputedareas.ManilahasproposedtobringthedisputetotheInternationalTribunalontheLawoftheSea,whichisopposedbyBeijingonthegroundsthattheScarboroughShoalisChineseterritory.35Rising nationalism and domestic politics have amplified these disputes and made anycompromises increasingly difficult. Whether it is on internet or in streets, emotionaloutpoursareondisplaywhenevernewsofterritorialencroachmentreachesthepopulace,and these are becoming increasingly frequent, public, and at times violent. Recentdemonstrations in Manila and Hanoi, and strong rhetoric by Chinese netizens are goodillustrations.36 Sovereignty claims in effect are competition formaritime rights.Althoughthe number of island and other insular features in the South China Sea remains small,claimstomaritimerightsandjurisdictionentitleclaimantstatestoexploitresourcessuchaspetroleumand fisheries.37Over the years, countlessmeetings,workshops, andofficial

32 Nicholas D. Kristof, “China and U.S. Company Sign Oil Deal for Disputed Waters,” New York Times, June 18, 1992, p. 7A. 33 Seth Mydans, “U.S. and Vietnam Build Ties with an Eye on China,” New York Times, October 12, 2010; Associated Press, “Vietnam Says China Is Holding 21 Fishermen on Disputed Island,” March 22, 2012; Alex Watts, “Tensions Rise as Vietnam Accuses China of Sabotage,” The Age, June 2, 2011. 34 Lyle Goldstein, “Strategic Implications of Chinese Fisheries Development,” China Brief 9:16 (August 5, 2009), pp. 10-13. 35 Brian Spegele, “Philippines Accuses China of Fanning Sea Tensions,” Wall Street Journal, May 23, 2012; Samantha Hoffman, “Sino-Philippine Tension and Trade Rising Amid Scarborough Standoff,” China Brief 12:9 (April 27, 2012), pp. 13-16. On the origins of the dispute, see Zou Keyuan, “Scarborough Reef: A New Flashpoint in Sino-Philippine Relations?” IBRU Boundary and Security Bulletin (Summer 1999), pp. 71-81. 36 Reuters, “Hundreds Protest in Vietnam against China over Sea Row,” June 5, 2011; Li Guoqiang, “What Does China Want in the South China Sea?” International Herald Leader, March 12, 2012. 37 M. Taylor Fravel, “Maritime Security in the South China Sea and the Competition over Maritime Rights,” in Cronin, Cooperation from Strength, pp. 33-50.

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dialogues have been devoted to finding ways to manage if not resolve the territorialdisputes, including the Canadian International Development Agency (CIDA) sponsoredlong‐runningworkshopsontheSouthChinaSea initiatedinthelate1980s.However,therolesofmultilateralorganizationsandmechanismsfordialoguehaveremainedlimitedintheir abilities to address issuesofmaritime rights, let alone sovereignty claims.Atmost,theseworkshopshavetendedtofocusonthelesscontentiousissuessuchasenvironmentalprotection, safetyofnavigation, fisheries, amongothers.The2002DOC, for instance,hasyettobefullyimplemented.38PartlydrivenbytheneedtodefendtheirsovereignclaimsintheSouthChinaSea,andpartlyasaresultofdefencemodernizationprocesses,SoutheastAsiancountries, fromVietnamtothe Philippines, have been engaged in defence modernization programs, with navalprocurement as the priority. Vietnam, for instance, has purchased six Russian Kilo‐classsubmarines andmore than 20 Su‐30MK combat aircraft.39 Being theweaker parties theirterritorialdisputeswithChina,countrieslikeVietnamandthePhilippinesareimpelledtoseek external assistance and support. Hanoi and Manila have strengthened ties withWashington. U.S.‐Vietnam relations have improved in recent years,with American navalships visiting Vietnamese ports and being serviced and a recent agreement on defencecooperation inmilitarymedicine.Manilahas sought to getWashington to agree that the1951 Mutual Defense Treaty covers the South China Sea, which the U.S. has resisted;Washington has offeredmaterial support and intelligence sharing.40 Clearly,Washingtonhas a narrower andmore specific interpretation of its obligations under the 1951MDT,whichforallintentsandpurposes,“doesnotautomaticallycoverthe[SpratlyIslandssinceitisa]disputedterritorywhich[was]notevenclaimedbyManilauntilaftertheTreatywassigned.”41 Hanoi used its position as the ASEAN Chair in 2010 to push for an ASEANcommonpositionontheSouthChinaSeadispute.Atthesametime,VietnamcontinuestomaintainregularbilateralcontactswithChina,seekingtoaddressdisputesatthehigh‐levelpolitical, party, and military dialogues.42 From Beijing’s perspective, the involvement ofexternalpowersinternationalizesandpoliticizestheissue,makinganysolutionevermore

38 Ian Downsend-Gault, “The Contributions of the South China Sea Workshops: the Importance of a Functional Approach,” in Sam Bateman and Ralf Emmers, eds., Security and International Politics in the South China Sea: Towards a Co-operative Management Regime (London and New York: Routledge, 2008), pp. 189-206; Sam Bateman, “Solving the ‘Wicked Problems’ of Maritime Security: Are Regional Forums up to the Task?” Contemporary Southeast Asia 33:1 (2011), pp. 1-28; Tran Truong Thuy, “The Declaration on the Conduct of Parties in the South China Sea and Developing Maritime Energy Resources,” NBR Special Report (December 2011), pp. 173-198. 39 International Institute for Strategic Studies, The Military Balance 2012 (London: Rutledge for IISS, 2012); Ian Storey, “Asia’s Changing Balance of Military Power: Implications for the South China Sea Dispute,” NBR Special Report #35 (December 2011), pp. 149-171. 40 Keith B. Richburg, William Wan, and William Branigin, “China Warns U.S. in Island Dispute,” Washington Post, June 23, 2011; “U.S., Vietnam Start Military Relationship,” DefenseNews, August 1, 2011; Lachlan Carmichael and Shaun Tandon, “U.S. Says It Will Provide Hardware to Philippines,” DefenseNews, June 23, 2011. 41 Ralph A. Cossa, Security Implications of Conflict in the South China Sea: Exploring Potential Triggers of Conflict (Hawaii: Pacific Forum CSIS, March 1998), p. C-8. 42 Carlyle A. Thayer, “The Tyranny of Geography: Vietnamese Strategies to Constrain China in the South China Sea,” Contemporary Southeast Asia 33:3 (December 2011), pp. 348-369; Interviews, Singapore, December 2011 and January 2012.

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elusive.43However, its attempt to blockdiscussion ofmaritimedisputes at theEastAsiaSummit was not successful as 16 of the 18 leaders mentioned the issue, even thoughChinese Premier Wen Jiabao emphasized that “the EAS is not the appropriate place todiscusstheSouthChinaSeaissue.”TheU.S.inparticularcalledforaregionalsolutiontothedisputes,aveiledrejectionoftheChina’spreferredone‐on‐oneapproach.44Despite recent tension betweenChina and a number ofASEAN countries,many analystsconclude thatmaritimedisputes in theSouthChinaSeaaremanageableeven though theprospectsfortheirresolutionremainratherelusive.Thiscautiousoptimismisunderlinedbythesharedrecognitionthatanymajorconflicts,includingtheuseofmilitaryforce,willentailextremecoststoallconcerned.China’seconomictieswithASEANhaveneverbeenstronger,withannualtradereaching$350billionlastyearandcouldreach$500billionin2015.45 At the same time, it is widely accepted that despite this growing economicinterdependence,ASEANcountriesremainsuspiciousofChina’sintentionsandarehedgingagainst future contingencies by strengthening their ties with the United States. Thiscoincides with the Obama administration’s strategic pivot toward Asia, which in turnantagonizesBeijing.However, Iwouldargue thatonbalance,ASEANcountries, includingthosewithterritorialdisputeswithChina,wouldstillwanttomaintainstablerelationshipswith Beijing even as they seek U.S. support as an assurance against Chinese coercivebehavior or even bullying. After all, there is no common position within ASEAN on theterritorial issues, exceptingapremiumon theirpeaceful resolution,andSouthChinaSeaissues are only one aspect of the group’s increasingly interdependent and complexrelationshipwith a risingChina. Indeed, the July 2012ASEAN foreignministersmeetingheldinPhnomPenh,CambodiaendedwithoutissuingajointcommuniquéduetofailureinreachingacommonpositionontheSouthChinaSeadisputes.46Recognitionof thepotential negative impacts of escalation in territorial disputeshas ledthe claimant states to compartmentalize thedisputes so as tominimize their impactsonother aspects of bilateral relationships. In both the China‐Vietnam and China‐Philippinecases,disputesoversovereigntyclaims,fishinggrounds,andoilextractionaretakingplacewhilehigh‐leveldiplomacyandofficialconsultationcontinue.Tradeagreementsaresigned,asarepledgesonseekingpeacefulresolutiontothedisputes.Forinstance,theheightenedtensionbetweenBeijingandHanoihasbeennoticeablycalmeddownwithVicePresidentXiJinping’svisitinlate2011.Indeed,thetwosideshavemaintainedregulardialogueandessentiallyseparatedterritorialdisputesfromstillfunctionalandnormalbilateralrelations

43 Li Jinming, “Nanhai zhengyi xianzhuang yu quyuwai daguo de jieru [The Status of the South China Sea Dispute and the Involvement of External Powers],” Xiandai Guoji Guanxi [Contemporary International Relations], no. 7 (July 2011), pp. 1-8, 38. 44 Daniel Ten Kate, “China Plays Down Sea Spats After Obama Challenges at Summit,” Businessweek, November 29, 2011; “For Peace and Prosperity in East Asia—On Premier Wen Jiabao’s Attendance at Meetings of East Asian Leaders,” PRC Foreign Ministry website, November 20, 2011, at: http://www.fmprc.gov.cn/eng/zxxx/t879898.htm; Peter Hartcher, “Asia Finds Voice in Test of Wills with China,” Sydney Morning Herald, November 22, 2011. 45 “For Peace and Prosperity in East Asia—On Premier Wen Jiabao’s Attendance at Meetings of East Asian Leaders,” PRC Foreign Ministry website, November 20, 2011, at: http://www.fmprc.gov.cn/eng/zxxx/t879898.htm 46 Jane Perlez, “Asian Leaders at Regional Meeting Fail to Resolve Disputes over South China Sea,” New York Times, July 12, 2012.

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in other areas.47 In the case of Sino‐Philippine relations, the recent standoff over theScarborough Shoal has yet to lead to complete diplomatic rupture between the twocountries. Indeed, only in March this year, Manila and Beijing launched the “China‐PhilippineFriendshipandExchangeYear.”Furthermore,bilateraltradereached$30billionlastyearandthetwocountrieshavesettheirsightsonexpandingthetradevolumeto$60billionby2016.48Isubmitthatthere‐emergenceofdisputesintheSouthChinaSeahasdemonstratedboththelimitationoftherolethatregionalinstitutionssuchasASEAN,ARFandtheEastAsianSummit(EAS) can play, and has also led to renewed efforts in developing effective multilateralmechanismsatconflictpreventionanddisputeresolution.OnecouldarguethatASEANhasplayedausefulroleindevelopingandadoptingitsowndeclarationontheterritorialdisputesbasedontheprinciplesenumeratedinthe1976TreatyofAmityandCooperation(TAC).The2002DOC,whilefarfrombeingabindingdocument,at leastcommitstheparties, includingChina,toseekingpeacefulwaystosettleterritorialdisputesintheSouthChinaSea.However,unlessASEANcanspeakwithonevoice,itsroleinmediatingtheSouthChinaSeaterritorialdisputeswillremainlimitedifnotalltogetherineffectual.49ThesamecanbesaidwithregardtoARF,whichhasoverthepasttwodecadesbarelymovedbeyond the phase of confidence building to the next one of preventive diplomacy, to saynothingof conflict resolution.WhileARFhasplayedan important role in socializingChina,keepingtheUnitedStatesinvolvedintheregion,andinstitutionalizinggreatpowerrelations,ithasyettotacklehardsecurityissuessuchastheNorthKoreannuclearprogram,theTaiwanStrait, and the South China Sea disputes. Recent years have seen more modest progresstowardgreatercooperationonnon‐traditionalsecurityissuessuchaspiracy,illicittrafficking,and humanitarian relief; however, where the South China Sea is concerned, there is noconsensus andBeijing’s strongobjectionhas greatly limitedARF’s ability toundertake anypreventive diplomacy role.50 With the participation of the U.S. in 2011, EAS can possiblyprovideaplatformwhere,withWashington’ssupport,concernsoverSouthChinaSeaissuescan be expressed. However, with Beijing clearly unhappy overwhat it perceives to be an“internationalization”ofdisputesbetweenclaimantstatesthatinitsviewcanbestbehandledbilaterally, it is still unclear andunlikely that theEASwill be anymore effective—ormoreacceptabletoChina,thanotherregionalinstitutions,asavenuetomediatedisputes.MaritimeDisputesandChina’sPursuitofSeaPowerBeijing’sapproachestotheSouthChinaSeaissuehaveundergonechangesovertime.Inthe1950s, the Chinese government on numerous occasions stated its territorial claims were47 Jiang Xun, “Xi Jinping fang yuenan huajie nanhai weiji [Xi Visits Vietnam to Defuse Crisis in the South China Sea],” Yazhou Zhoukan [Asia Weekly], January 8, 2012, pp. 22-23. 48 Hoffman, “Sino-Philippine Tension.” 49 Ralf Emmers, “The Changing Power Distribution in the South China Sea: Implications for Conflict Management and Avoidance,” Political Science 62:2 (2010), pp. 118-131; Ian Storey, “ASEAN and the South China Sea: Movement in Liue of Progress,” China Brief 12:9 (April 27, 2012), pp. 10-13. 50 Ralf Emmers and See Seng Tan, “The ASEAN Regional Forum and Preventive Diplomacy: Built to Fail?” Asian Security 7:1 (2011), pp. 44-60. 

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basedlargelyonhistoricaldiscoveries;however,duetodistanceandlackofcapabilities,Chinawasnotabletoenforceitsclaims.Instead,Chinahaspursuedadelayingstrategyfocusingonstatusquoandrespondingtoothers’claimsshouldthelatterarise.Atthesametime,drivenbyitsorganizationalinterest,theChineseNavy(PLAN)hasconsistentlypushedforeffectivecontrol of theParacels and the Spratlys, resulting in directmilitary clasheswith the SouthVietnamese (1974) and Vietnam (1988). After the 1974 victory over South Vietnam thatresulted inChinese takeoverof theParacel Islands,PLANbeganconstructionon theseizedislands toconsolidate itscontrolovertheentirearchipelago.Apart fromthesetwomilitaryclasheswithVietnam,Chinahasrarelyresortedtotheuseofforce,eventhoughitconsidersactions by other claimant states as encroaching on its sovereignty.51 In 1992, the ChineseNationalPeople’sCongresspromulgatedalawon“TerritorialSeaandtheContiguousZone”thatcoversislandgroupsintheSouthChinaSea,includingtheSpratlyIslands(Nansha)andtheParacel Islands (Xisha).Whilearguably ingeneralaccordancewithUNCLOSprovisions,the Chinese legislation has also proven to be controversial, as it claims sovereignty overfeaturesalsoclaimedbyotherstates,suchasVietnamandJapan.52Aseriesoflegislationhasbeenpublishedsincethen,includingthe2009LawonSeaIslandProtection,whichestablishesbroadadministrativeresponsibilitiesoverChina‐claimedoffshore islands. Inaddition, since1999, China has also imposed ban on fishing over 128,000 square kilometers ofwaters indisputed territorieswith Vietnam; enforcement of the unilateral ban involves lengthy andregularpatrolsandrun‐inanddetentionofforeignfishingboatsandfishermen.VietnamandthePhilippineshaverespondedandretaliatedinkind.53Disputes over the South China Sea, between China and a number of other claimant states,escalated in the early 1990s, highlighted by the promulgation of the 1992 law and theoccupation of theMischief Reef in 1995. ASEAN reacted by issuing the Declaration on theSouth China Sea, which called on the parties concerned to settle their disputes throughpeacefulmeans.Chinamadeitclearthatitwouldnotacceptanymultilateraldiscussionoftheissues.However,sincethelate1990s,Beijinghasmodifieditspositiontoanextentandhassigned a number of instrumentswith ASEAN, including the Declaration on the Conduct ofParties in the South China Sea (2002), the ASEAN‐China Framework Agreement onComprehensive Economic Cooperation (2002), and the Treaty of Amity, Cooperation inSoutheastAsia (2003).Bilaterally,Chinaand thePhilippinesalso reachedagreementonaneight‐pointcodeofconductinAugust1995.ThesedevelopmentshavehelpedimproveChina‐ASEAN relations, paving theway for greater economic integration andpreventing conflictsoverterritorialdisputes.54

51 John W. Garver, “China’s Push Through the South China Sea: The Interaction of Bureaucratic and National Interests,” The China Quarterly (1992), pp. 999-1028; M. Taylor Fravel, “China’s Strategy in the South China Sea,” Contemporary Southeast Asia 33:3 (December 2011), pp. 292-319. 52 Max Herriman, “China’s Territorial Sea Law and International Law of the Sea,” Maritime Studies (January-February 1997), pp. 15-20. 53 Sarah Raine, “Beijing’s South China Sea Debate,” Survival 53:5 (October-November 2011), pp.69-88. 54 Mikael Weissmann, “The South China Sea Conflict and Sino-ASEAN Relations: A Study in Conflict Prevention and Peace Building,” Asian Perspective 34:3 (2010), pp. 35-69; Tran, “The Declaration on the Conduct,” pp. 177-178.

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While refraining from seizing new features in the South China Sea, China has nonethelesssought to reinforce its territorial claims in diplomatic and administrative ways.Diplomatically,Beijingdemonstratesitsclaimstosovereignty inresponsetootherclaimantstates’activitiessuchasjointenergyexplorationwithforeigncompaniesinareasconsideredtobeChinesemaritimeterritories.Forinstance,the2008withdrawalofExxonMobilfromamajoroffshoreoilconcessionofferedbyVietnamreportedlywasattributedtoveiledthreatfromChina,whichalso claims sovereigntyover thearea.55China’smaritimeadministrativeandenforcement agencies, suchas theMaritimeSafetyAdministration, theChinaMaritimePolice,theFisheriesLawEnforcementCommand,exercisejurisdictionoverwhatitclaimstobe its national waters, including routine patrols, detention and dispel of foreignfishermen/ships, and other maritime enforcement activities.56 Since 2008, ChinaMaritimeSurveillance has maintained regular law enforcement patrols covering all national watersunderChinesejurisdictionfromthemonthoftheYaluRiverinthenorthtothesouthernendin JamesShoal.57ArecentpatrolbyChinaMaritimeSurveillance’sSouthChinaSeaBrigadedetectedmorethan30oil/gasrigs/platformsoperatedbyforeigncompanieswithinChina’snational waters.58 However, it has been pointed out that the multiple maritime lawenforcementagenciesinChinahavecausedredundancies,poorcoordination,andinefficiency,witheachpursuingitsownagenda,motivatedbyinstitutionalinterestsoflargerbudgetsandgreater power and prestige. According to the International Crisis Group, “the conflictingmandateandlackofcoordination…havestokedtensionsintheSouthChinaSea.…Anyfuturesolution …will require a consistent policy from China executed uniformly throughout thedifferent levels of government along with the authority to enforce it.”59 Indeed, even theChinese themselves have acknowledged this problem, with some prominent analysts nowcalling for reform and re‐organization and even the establishment of China’s own coastguard.60Tothateffect, ithasbeenreportedthatanewadhoc“LeadingSmallGroupontheSouthChinaSea” issuewas setup in2010, chairedbyDaiBingguo, the StateCounselor inchargeofforeignaffairs.61OfficialChinesepositionsontheterritorialissueshaveremainedunchanged;nonetheless,surprisinglydiverseviewsonhowtomanagetheSouthChinaSeaconflictsamongChineseanalystshaveemergedinrecentyears.Ontheonehand,thereare,quiteexpectedly,strongvoices calling for more assertive responses to perceived “encroachments” by otherclaimant states, including the use of economic sanctions and even force to showChina’sresolve.ThesetypicallycomefromthePLA,whichinrecentyearshasbecomemorevocalregarding the South China Sea. However, these extreme views do not reflect official

55 Valencia, Foreign Military Activities in Asian EEZs, p. 6. 56 Lyle J. Goldstein, Five Dragons Stirring Up the Sea: Challenge and Opportunity in China’s Improving Maritime Enforcement Capabilities (New Port, RI: China Maritime Studies Institute, Naval War College, April 2010); Fravel, “China’s Strategy in the South China Sea.” 57 Zou, “China’s U-Shaped Line,” pp. 13-14. 58 Suo Youwei and Luo Xi, “Patrol Detects More Than 30 Foreign Oil and Gas Rigs,” Chinanews.com, March 20, 2012. 59 International Crisis Group, Stirring Up the South China Sea (I)., p. i. 60 “PLA General Calls for Establishment of Coast Guard,” Global Times, March 6, 2012; Jeremy Page, “General Calls for New Coast Guard to Patrol South China Sea,’ Wall Street Journal, March 7, 2012. 61 International Crisis Group, Stirring Up the South China Sea (I), p. 33. 

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positions; nor do they influence government policies, which have remained restrained.Moreover, themajorityviewappears toadvocate for cautiousandmoderateapproaches.Indeed,someevensuggestthatnegotiationshouldbetheapproachtoaddressingmaritimeterritorialdisputes.62Researchandinterviewswiththeregion’sanalysts,includingChineseexperts,donotsuggestthatChinawillresorttotheuseofforcetosolveterritorialdisputesgiventhereputationalanddevelopmentalcosts.Therearenonethelessgrowingconcernsfrom this community of Chinese experts that theUnited States is using South China Seadisputestojustifya“re‐pivoting”totheregioninaneffortof“soft”containmentofChina.Meanwhile,thereisalsoconsensusthatrecenttensionshavebeenlargelycausedbyotherclaimantstatesandChinahasbeenplacedinanawkwardpositionofeitherdemonstratingrestraint,whichwouldbe seen asweakness, or else asserting its sovereign rights in theSouth China Sea, which in turn would be viewed negatively as evidence of bullying ofsmallerandweakerneighboursbya risingChina intenton flexing itsmuscles.For sometimetocome,theofficialChinesepositionwilllikelybetostandfirmonsovereigntyissueswhile seekingways to contain and limit the costs of potential conflicts, and for peacefulresolution.63 For instance,Beijing reacted vehemently afterVietnam’sNationalAssemblyapprovedtheLawontheSeaofVietnam(alsocalledMaritimeLawofVietnam)onJune21,2012, which claimed sovereignty over the Paracel and Spratly Islands. The Chinesegovernment also announced the establishment a prefecture‐level municipality toadministratethevariousislandgroupsinthedisputedarea.64Inviewofalimitedabilityto“seizeandcontroldisputedterritories,”andChina’sdomesticpriorities,bothwouldcautionagainst a more aggressive and militarized approach to territorial disputes for theforeseeablefuture.65China has called on all claimants to resolve territorial disputes through peacefulmeans,refrain from unilateral actions, and engage in joint development for mutual economicbenefits.However, at the same time,Beijinghasopposedanyattempt toestablisheithermultilateralorinternationalmechanismstohandlethedisputes,arguingthattheonlywayto address them is through negotiations by the countries concerned, and in effectbilaterally.ThisexplainswhyBeijinghaspreferredtodiscusstheterritorialissueswiththerelevant parties directly, notwith ASEAN as a bloc,while the latter has a long‐standingpractice of dealing its partners collectively and after internal consultation first.66 Beijingnonetheless has participated inmultilateralmeetingswithASEAN since the early 2000s,includingsigningtheDeclarationontheConductofPartiesintheSouthChinaSeain2002

62 Lyle Goldstein, “Chinese Naval Strategy in the South China Sea: An Abundance of Noise and Smoke, but Little Fire,” Contemporary Southeast Asia 33:3 (December 2011), pp. 320-347; Raine, “Beijing’s South China Sea Debate,” p. 77. 63 Li Mingjiang, “Chinese Debates of South China Sea Policy: Implications for Future Developments,” RSIS Working Paper No. 239 (Singapore: S. Rajaratnam School of International Studies, May 2012). 64 Jane Perlez, “Vietnam Law on Contest Islands Draw China’s Ire,” New York Times, June 21, 2012.

65 M. Taylor Fravel, “Power Shifts and Escalation: Explaining China’s Use of Force in Territorial Disputes,” International Security 32:3 (Winter 2007/08), pp. 44-83; Fravel, “International Relations Theory and China’s Rise: Assessing China’s Potential for Territorial Expansion,” International Studies Review 12 (2010), pp. 505-532; interviews, Singapore, Shanghai, January 2012; Beijing, February 2012. 66 Tran, “The Declaration of the Conduct,” pp. 183-184.

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and the July 2011 guidelines for DOC implementation.67 Efforts by Vietnam and thePhilippines to push for a code of conduct were strongly opposed by China. The finaldocumentdid reaffirmparties’ respect for freedomofnavigationandoverflightover theSouth China Sea. At the same time, the DOC also committed parties to “resolve theirterritorialandjurisdictionaldisputesbypeacefulmeans,withoutresortingtothethreatofforce, through friendly consultations and negotiations.” However, Beijing reiterated thatthedocumentwasnotdesignedtoresolveterritorialdisputesinamultilateralcontext,butthroughbilateralnegotiation.68Beijingseekstoreassureothers,statingthatitiscommittedtokeepingsealanesopenandproposed fundingmaritimecooperationwith itsneighbors.At thesametime,ASEANhasbeen cautious inwalking a delicate line betweenwelcomingAmerica’s role in the SouthChinaSeamediationandnotaffrontingChinadirectlyasacollectivegroup.Forinstance,atthe 2nd U.S.‐ASEAN Leaders Meeting, the final joint statement, while reaffirming theimportance of regional peace and stability and unimpeded commerce and freedom ofnavigation, contained no explicit reference to the use or threat of force, or to the SouthChinaSeabyname.69After theNovember2010ASEAN‐ChinaSummit inHanoi, atwhichthe Plan of Action to Implement the Joint Declaration on ASEAN‐China StrategicPartnership forPeaceandProsperity(2010‐2015)wasreleased,BeijingpledgedtoworkwithASEANto“pushforwardthefullandeffectiveimplementationoftheDoCintheSouthChinaSea”and“towardtheeventualconclusion…ofacodeofconduct in theSouthChinaSea.”70Atthe14thChina‐ASEANSummitheldinIndonesia’sBaliIslandinNovember2011,Chinese Premier Wen Jiabao proposed a number of steps to deepen China‐ASEANcooperation,includinginthemaritimefield.Wenpledgedtoprovide$10billioninloansforinfrastructure projects in ASEAN countries; he also promised to set up a China‐ASEANmaritime cooperation fund (three billion yuan) to promote cooperation. Likewise, at theASEAN‐China senior officials meeting in July 2011, the Chinese side also made variousspecific proposals on, amongother things, the convening of a symposiumon freedomofnavigation, and the establishment of special committees on marine scientific research,navigationalsafety,environmentalprotection,searchandrescue.71PeterDuttonoftheU.S.NavalWarCollegearguesthattherecentheighteningoftensioninthe South China Sea displays three disputes China is engaged in: territorial sovereigntyclaims, jurisdiction over seabed and waters; and balance between coastal states and67 Ian Storey, “China’s Bilateral and Multilateral Diplomacy in the South China Sea,” in Cronin, Cooperation from Strength, pp. 53-66; Garver, “China’s Push Through the South China Sea.” 68 Cited in Erik Beukel, China and the South China Sea: Two Faces of Power in the Rising China’s Neighborhood Policy. DIIS Working Paper 2010:7 (Copenhagen: Danish Institute for International Studies, 2010), p. 15. 69 Amitav Acharya, “ASEAN’s Dilemma: Courting Washington without Hurting Beijing,” Asia Pacific Bulletin, no. 133, October 18, 2011; Thayer, “Recent Developments in the South China Sea,” pp. 16-18. 70 “Plan of Action to Implement the Joint Declaration on ASEAN-China Strategic Partnership for Peace and Prosperity,” ASEAN website, http://www.aseansec.org/16805.htm 71 “Premier Wen Jiabao Attends 14th China-ASEAN Summit and Delivers Speech,” Chinese Foreign Ministry website, November 18, 2011, at: http://www.fmprc.gov.cn/eng/zxxx/t879362.htm; “China Pledges to Be ‘Good Friend’,” Straits Times, November 19, 2011; Xinhua, “China, ASEAN Nations Agree on Guidelines for Implementation of DOC in [sic] South China Sea,” July 20, 2011, at: http://news.xinhuanet.com/english2010/2011-07/20/c_13997623.htm

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internationalrightstonavigationformilitarypurposes.Beijing’sobjectivesaretopromoteregionaleconomic integration,controloverenergyandresources,andenhancedsecuritytoprotectitsinterests.72ChineseassertivenessinitsclaimsovertheSpratlyIslandshasalsobeeninformedbyitsstrongsenseofsovereigntyandterritorialintegrity,andmorepragmaticeconomic security considerations, including securing a peaceful external environment foreconomicdevelopmentandprotectingthecountry’seconomicinterests,andsecuringitsland,air space, and its territorial waters. The growing attention to maritime interests and thecultivationofa“conceptionofseaasterritory”(haiyangguotuguan)reflectedbothrecognitionof thepotentialofmaritimeresourcesfornationaleconomicdevelopmentandarealizationthatChinamustenhanceitsabilitytoprotectitsperceivedmaritimeterritories.73Thepast ten years havewitnessed an emergingChinesedebate between two competinginterpretations and visions of the defining nature and direction of the country’s futurepowerstatus:whetherChinaisandshouldremainacontinentalpowerorpursuetobeagreatseapower.Withoutadoubt,China’sgrowingintegrationintotheglobaleconomyhasraised itsawarenessof itsmaritime rightsand interests, asdo itsmaritimeactivities.Asdiscussed above, the Chinese economy is heavily dependent on international trade, andcontinued growth relies on the safe and secure supply of raw materials and energy,especially oil. While Beijing has been paying increasing attention to the Indian OceanRegion,inrecentyears,aso‐called“seaconsciousness”isbeingintroducedintothepagesofChinesemediaandacademicjournals.“Blueterritories”and“invisibleboundaries”nowbecomehottopicsasChina’sinterestinanddependenceontheoceansincrease.Beijing’sofficialpositionhasalwaysbeenthatbasedontheUnitedNationsConventionontheLawoftheSea(UNCLOS),Chinahasoverthreemillionsquarekilometersinmaritimeterritoriesunderitsmanagement,includingcontinentalshelvesandthe200‐mileexclusiveeconomiczones (EEZs) in the East and South China Sea. Taken together these vast maritimeterritories provide potentially enormous resources for China’s large population. Oceansprovide the economic lifelines, serve as the platforms for military command of thecommons, and could be the high frontier of science and technology, and therefore thefertilegroundsforcompetitionandcontrol.74TheChinesegovernmentinthepasttwodecadeshasissuedvariouslawsanddocumentsasareflectionof itsgrowingrecognitionofmaritimerights.For instance, the11thFive‐YearProgramstatesthatthecountryneed“tostrengthentheprotectionofislands…improvethe72 Peter Dutton. “Three Disputes and Three Objectives: China and the South China Sea,” Naval War College Review 64:4 (Autumn 2011), pp. 42-67. 73 Ju Hailong, Zhongguo Haiquan Zhanlue [The Strategy of Chinese Sea Power] (Beijing: Shishi chuban she, 2011); Guo Yan, Diyuan Zhengzhi yu Nanhai Zhengduan [Geopolitics and the South China Sea Disputes] (Beijing: China Social Sciences Press, 2011); Hai Tao, “Zhongguo haijun yingdazao ‘taipingyang jiandui’ [China Should Form a Pacific Fleet],” Guoji Xianqu Daobao [International Herald Leader], December 5, 2011. 74 Liu Zhongmin, “Zhongguo guoji wenti yanjiu shiyuzhong de guoji haiyang zhengzhi yanjiu shuping [An Analytical Review of Scholarship on International Maritime Politics in China’s International Studies Researches],” Taipingyang Xuebao [Journal of Pacific Studies], no. 6 (2009), pp. 78-89; “Zhuanti baodao: jinglue ‘lanse guotu’ [Special Report: Managing ‘Blue Territories’],” Liaowang Xinwen Zhoukan [Outlook News Weekly], September 4, 2006, pp. 20-29; “Fengmian huati: haiyang: lanse de jiaozhuo [Cover Story: Ocean: the Blue Competition],” Shijie Zhishi [World Affairs], no. 22 (2007), pp. 16-23; Zhang Wei, “Guojia haishang anquan lilun tanyao [Discussion on National Maritime Security Theories],” Zhongguo Junshi Kexue [China Military Sciences] 20:1 (2007), pp. 84-91.

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demarcation of maritime areas, regulate the orderly use of the sea” and “develop in afocused way the resources in the exclusive economic zone, continental shelf, andinternationalseabed.”The2006DefenseWhitePaperstatesthatthePLANischargedwithdevelopinga“gradualextensionofstrategicdepthforoffshoredefensiveoperations.”SomeoftheChinesemaritimelawsandregulationsincludingthefollowing:“NationalRegulationonUninhabitedIslands”(June2003;jointlyissuedbytheStateOceanicAdministration,theMinistry of Civil Affairs; and the PLA); “Exclusive Economic Zone and Continental Shelf”(January1998);“LawoftheTerritorialSeaandtheContiguousZone”(February1992).75Chinese analysts increasingly recognize the growing importance of sea and maritimeinterestsinthedevelopmentofChina’soverallmilitarycapabilities.TheyarguethatChinashouldtransitionfromitsstatusasatraditionallandpowertoonecapableofpursuinganddefending itsmaritime geo‐strategic interests.76 It has been pointed out that the reasonChinacannotresolvetheSouthChinaSeaterritorialdisputestoitsfavorisduetoitsweaknavy, especially its far‐sea (yuanyang) operating and control capabilities. Some Chineseanalysts have argued for a blue water navy and power projection capabilitiescommensurate with China’s growing international role and reflecting the country’sincreasing dependence on overseas oil and its need to secure crucial sea lines ofcommunication(SLOCs).77PLANhasovertheyearspushedfortakingastrongerpositionontheterritorialissuesintheSouthChinaSea,apparentlytoboostitsownbudget.AdmiralLiu Huaqing, PLAN commander in 1982‐88, was a vocal advocate for asserting China’ssovereigntyovertherichmaritimeresources.78

75 “OSC Analysis: China: Measures Aim to Bolster Control of Maritime Interests,” Open Source Center, May 31, 2007. 76 Xu Qi, “Maritime Geostrategy and the Development of the Chinese Navy in the Early Twenty-First Century,” Naval War College Review 59:4 (Autumn 2006), pp. 47-67 (translated by Andrew S. Erickson and Lyle J. Goldstein); Zhang Wenmu, “Sea Power and China’s Strategic Choices,” China Security (Summer 2006), pp. 17-31. 77 See, for example, Zhang Wenmu, “Jingji quanqiuhua beijingxia de zhihaiquan wenti [The Issue of Sea Control Against the Background of Economic Globalization], May 16, 2007, in Eastday’s online military section. 78 Garver, “China’s push.”

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The First and Second Island Chains. PRC military theorists refer to two “island “chains” along China’s maritime perimeter. The First Island Chain includes Taiwan and the Ryuku Islands; the Second Island Chain extends from Japan to Guam. Source: Department of Defense, Report to Congress: Military and Security Developments Involving the People’s Republic of China (Washington, D.C.: Office of the Secretary of Defense, August 24, 2011), p. 23. Clearly, the SouthChina Sea issues aremore than sovereignty claims.This is a regionofstrategicimportance,connectingtheIndianOceanandtheWesternPacific,andwithvitalsealinesofcommunicationthatensuretheflowofinternationaltradeandthetransportofresourcesandenergy formanyof the region’s economies. Issues suchasproliferationofweapons of mass destruction (WMDs), maritime terrorism, piracy, illicit trafficking indrugsandarms,oilspillsandpollution,illegalfishing,arenowbecomingmoreprominent.Thegreatpowerscontendforthecommandofthecommonwhilelittoralstatesengageinnaval buildup to enable them exercise control over what they see as their maritimeterritories.79ForChina, thedebate iswhetheritsmaritimestrategyshouldremainoneof“near sea offense and deep sea defense.” This strategy is based on China’s near‐termobjectiveofpreventingTaiwaneseindependenceandblockingU.S.interventiontosupport

79 Sarah Raine, “Beijing’s South China Sea Debate,” Survival 53:5 (October-November 2011), pp. 69-88.

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suchadevelopment,aswellasonrecognitionofthepracticallimitsofChina’scurrentandprojected naval capabilities. Recognizing that China has unresolved territorial disputeswithanumberofSoutheastAsiancountriesandthat thecontestedareasmaycontainoilandgasresources,suchastrategywouldalsoenableChinatodefenditssovereigntyandmaritimeeconomicinterestsinthisarena.80Since he became the CentralMilitary Commission Chairman in 2004,Hu Jintao has paidparticularattention tonavalmodernization.Hecalledon thePLA toundertake the “newhistoricalmissions,”whichincludethemilitary’snewroleinsafeguardingChina’sgrowinginterests inmaritime,space,andelectromagneticspaceandparticipationin internationalpeacekeeping operations. Hu has also placed great emphasis on the country’s energysecurity,thereforeelevatingtheimportanceoftheSouthChinaSea,withitsrichfossilfueldepositsand its criticalpositionstraddlingmajorSLOCsconnecting theStraitofMalaccaand the Indian Ocean, where more than 40% of China’s oil imports are shipped.81 ThePLAN’smissionthereforeisnotjustcoastalareasbutalsotoward“bluenavy”postureandexpansionof scope ofmaritime strategic defence; however, for the timebeing, the goalsseemtoberathermodestandfocusoncontrolofChina’sadjacentwatersandasea‐denialcapabilitywithin the first island chain by2010‐2020.82A regional navywill be down theroad that in theory could meet China’s growing maritime interests. Others suggest thatChinamayhaveamuchmoreambitiousplan,withPLANofficerstalkingaboutthreeocean‐goingfleetsthatcovertheWesternPacific,andtheIndianOceanandtheStraitofMalacca.ShouldthePLANadopta“farsea”strategy,itwouldhavemajorimplicationsforthefuturedevelopmentofitsnavalcapabilitiesandwithfar‐reachingimpactsontheIndianOcean.83Whilethejuryisstillout,itappearsthatChina’scurrentnavalorderofbattlewillleavethePLANlittlechoicebuttofocusonthenearseaoption,ratherthandeployapowerfulbluewatersurfacefleet.Thefocuswill likelyremaindeterrenceagainstTaiwanindependenceandthedevelopmentofabilitiestopreventexternalmilitarypowersfromgettinginvolvedshould amilitary conflict over the Taiwan Strait break out, e.g., the deployment of anti‐

80 Phillip C. Saunders, Christopher Yung, Michael Swaine, and Andrew Nien-dzu Yang, eds., The Chinese Navy: Expanding Capabilities, Evolving Roles (Washington, D.C.: National Defense University Press, 2011); Ronald O’Rourke, China Naval Modernization: Implications for U.S. Navy Capabilities—Background and Issues for Congress. CRS Report RL13353 (Washington, D.C.: Congressional Research Service, February 8, 2012). See also, Jin Heng, “Zhongguo haijun ying jianchi jingong yuanfang zhanlue” [PLAN Should Maintain A Near-Sea Offensive and Deep-Sea Defensive Strategy], Jianchuan zhishi [Naval & Merchant Ships], May 2007 http://mil.eastday.com/m/20070528/ula2864541.html. 81 Nan Li, “Scanning the Horizon for ‘New Historical Missions’,” Proceedings Magazine 136:4 (April 2010). 82 Andrew Erickson, Lyle Goldstein, and Carnes Lord, “China Sets Sail,” The American Interest Online, May-June 2010 issue, at: http://www.the-american-interest.com/article.cfm?piece=806; Robert S. Ross, “China’s Naval Nationalism: Sources, Prospects, and the U.S. Response,” International Security 34:2 (Fall 2009), pp. 46-81. 83 Nan Li, “The Evolution of China’s Naval Strategy and Capabilities: From ‘Near Coast’ and Near Seas’ to ‘Far Seas’,” Asian Security 5:2 (May 2009), pp. 144-169; You Ji, “”Dealing with the Malacca Dilemma: China’s Efforts to Protect Its Energy Supply,” Strategic Analysis 31:3 (May 2007), pp. 467-489; Gordon Fairclough, “As China Grows, So Does Its Long Neglected Navy,” Wall Street Journal, July 16, 2007, p. A1; James R. Holmes and Toshi Yoshihara, “Ryukyu Chain in China’s Island Strategy,” China Brief X:18 (September 10, 2010), pp. 11-14.

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access and area‐denial as well as sea‐based second‐strike nuclear capability.84 It alsoentailstheabilitytoprotectChina’smajortradeandenergytransportroutesthatrunfromtheIndianOceanandtheStraitofMalacca,throughwhich80percentofitsoilimportsareshipped.Along this line, Chinesemaritime focuswill remain on the offshore or near seaareasthatextendtoincludetheTaiwanStrait,thelatestDepartmentofDefensereportonChinesemilitarypowertothecontrary.ThePLAN’slikelymid‐term(10‐15years)ambitioncould lead it to pursue capabilities that go up to and even beyond the so‐called “secondisland chains” andpossibly theMalaccaStrait.Anyventures towarddeep seas, includingtheIndianOcean,will largelybeafunctionofhowtheTaiwanStraitandtheSouthChinaSea issues aremanaged and/or resolved. In sum,while current Chinese discussions anddebatesonmaritimestrategyrecognizethecriticallinkbetweeninterests,rights,andnavalcapabilities,theseremainbyandlargeaspirationsforthetimebeing.85Foryears, the choicesbetweenablue‐waternavy that focusesonaircraft carrier groupsand submarines have tended to be biased toward the latter due to a combination ofpolitical‐diplomatic and technical‐financial considerations. But changemay have alreadytaken place.With double‐digit growth in defence spending over two decades, the Chinesemilitary, and its navy in particular, is procuring major weapons systems, includingsubmarines,surfaceships,andship‐bornefighteraircraft.Seatrialsofthefirstaircraftcarrierhavetakenplace.Therearealsotalksaboutdevelopinguptofourindigenouslymanufacturedcarriersby2020.Indeed,forsomeChineseanalysts,whetherornotacountrywillpursueandownaircraftcarriershaslesstodowithitsfinancialcapabilitiesthanwhereandhowitsnationalinterestsinformthatdecision.86Nowtheissuebecomeswhattypesofaircraftcarriers China is going to build andmore importantly, towhat purposewill it be put touse.87And the Chinese navy has in recent years conductedmore frequent and high‐profilemilitaryexercisesdemonstrating itspowerprojectioncapabilities. In2010alone, fourhigh‐profileandlarge‐scalenavalexerciseswereconducted.AlargenumberofwarshipsrangingfromSovremenny‐classdestroyers,Kilo‐classsubmarines,modernmissiledestroyers,fighterbombers,marinecorpsunits,anddrawnfromallthreefleetsparticipatedintheseexercises,which involved live firing and anti‐submarine warfare, simulated attacks on enemy fleetformations, andmissile firing. These exercises demonstrate the Chinesemilitary’s growingcapacitytosustainlargerandlonger‐periodnavaldeploymentintotheSouthChinaSea.88

84 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the People’s Republic of China 2012 (Washington, D.C.: Department of Defense, May 2012). 85James R. Holmes and Toshi Yoshihara, “A Chinese Turn to Mahan?” China Brief IX:13 (June 24, 2009), pp. 8-11; Holmes and Yoshihara, “History Rhymes: The German Precedent for Chinese Seapower,” Orbis (Winter 2010), pp. 14-34. 86 Andrew S. Erickson and Andrew R. Wilson, “China’s Aircraft Carrier Dilemma,” Naval War College Review 59:4 (Autumn 2006), pp. 12-45; Ian Storey and You Ji, “China’s Aircraft Carrier Ambitions,” ibid., 57:1 (Winter 2004), pp. 76-93; Dong Ruifeng and Liu Demao, “Hangmu zheshe guojia zhanlue liyi [Aircraft Carriers Reflection of National Strategic Interests],” Liaowang Xinwen Zhoukan [Outlook News Weekly], no. 15 (April 9, 2007), pp. 54-56. 87 Andrew S. Erickson, Abraham M. Denmark, and Gabriel Collins, “Beijing’s ‘Starter Carrier’ and Future Steps: Alternatives and Implications,” Naval War College Review 65:1 (Winter 2012), pp. 15-54. 88 Office of the Secretary of Defense, Military and Security Developments Involving the People’s Republic of China 2011. Report to Congress (Washington, D.C.: Department of Defense, May 2011); Felix K. Chang, “China’s Naval Rise and the South China Sea: An Operational Assessment,” Orbis (Winter 2012), PP. 19-38; Jeremy Page, “China

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CompetingforPrimacyintheCommonsThepastdecadehaswitnessedthephenomenalriseofChina,ineconomicpower,politicalinfluence, andmilitary capabilities. Beijing’smore assertive behavior in the South ChinaSea,and itsdirectchallenges toU.S. intelligencegatheringandsurveillanceactivitiesandjointmilitaryexerciseswithallieseithercloseto,or inChineseEEZs,confirmstherealistarguments that rising powers have expanding agendas, tend to redefine and assert itsinterests, and are in general disruptive and threatening to the existing internationalsystem.89Indeed,whilemostanalystswouldreadilydismissanynear‐termdirectmilitaryconflicts between China and the other claimant states, both because of the sheerasymmetry incapabilitiesand thepolitical repercussions forBeijing, thesamecannotbesaid about Sino‐U.S. encounters on the high seas in western Pacific. Indeed, growingChinese assertivenesswith regard to activities of foreignmilitary ships operatingwithinand/ornearitsEEZs,posesaseriouschallengetolong‐heldU.S.supportfortheprincipleoffreedomofnavigation,andparticularlytheU.S.viewofwhatfreedomofnavigationentails,including its ability to conduct surveillance and intelligence gathering, and could lead toseriousconfrontation.90InJune1988,ChinaofficiallypromulgatedtheLawontheExclusiveEconomicZoneandtheContinentalShelf.Chineseanalysts insist that “anymilitaryactivity that isharmful to thecoastalstate’ssovereigntyorsecurityintheexclusiveeconomiczoneisillegalandcannotbe tolerated.”91 When China ratified UNCLOS in 1996, it made the following statementregardinginnocentpassage:“TheprovisionsoftheUnitedNationsConventionontheLawoftheSeaconcerning innocentpassagethroughtheterritorialseashallnotprejudicetheright of a coastal State to request, in accordancewith its laws and regulations, a foreignStatetoobtainadvanceapprovalfromorgivepriornotificationtothecoastalStateforthepassageof itswarships throughthe territorialseaof thecoastalState.”92 Inotherwords,“foreignmilitaryvesselsmustprovidepriornotificationbeforeenteringanEEZand thatforeign military activities involving hydrography, surveys, and intelligence‐gathering

Flexes Muscle,” Wall Street Journal, August 11, 2011; Julian E. Barnes, Nathan Hodge and Jeremy Page, “China Takes aim at U.S. Naval Might,” Wall Street Journal, January 4, 2012; Carlyle A. Thayer, “Recent Developments in the South China Sea: Grounds for Cautious Optimism?” RSIS Working Paper No. 220 (Singapore: S. Rajaratnam School of International Studies, December 14, 2010). 89 John J. Mearsheimer, The Tragedy of Great Power Politics (New York: W.W. Norton, 2001). 

90 Leszek Buszynski, “The South China Sea: Oil, Maritime Claims, and U.S.-China Strategic Rivalry,” The Washington Quarterly 35:2 (Spring 2012), pp. 139-156; Peter Dutton, “Introduction,” in Dutton, ed., Military Activities in the EEZ: A U.S.-China Dialogue on Security and International Law in the Maritime Commons (New Port, RI: China Maritime Studies Institute, Naval War College, December 2010), pp. 1-13; Dutton, “Three Disputes and Three Objectives.” 91 Peng Guangqian, “China’s Maritime Rights and Interests,” in Peter Dutton, ed., Military Activities in the EEZ: A U.S.-China Dialogue on Security and International Law in the Maritime Commons (New Port, RI: China Maritime Studies Institute, Naval War College, December 2010), pp. 15-22. 92 Quoted in Zou Keyuan, “Law of the Sea Issues Between the United States and East Asian States,” Ocean Development & International Law 39 (2008), p. 72.

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withintheEEZareillegalbecausetheysignifyhostileintentandthusviolatethe‘peacefulpurposes’provisionsofUNCLOS.”93ThecontentionovermilitaryactivitiesinEEZsisnothingnew.Theissuewascontroversialduring theUNCLOS negotiation,with Articles 56 and 58 in effect granting coastal statesrightsovereconomicresources;otherwisetheUNCLOShaspreservedtheexistingregimesoffreedomofnavigation,includingmilitaryactivitiesincoastalstateEEZs,fromcollectingintelligencetonavalexercises.U.S.analystsemphasizethatwhattheUNCLOShasgrantedtocoastalstatesarethesovereignrights—butnotsovereignty—overtheirEEZsandonlyfor economic and resources management purposes, marine scientific research, and theprotectionofenvironments.Userstatesshouldgiveduerespecttotheserightsaccordingtointernational law.94However,with theadvanceof technology, it isbecoming increasinglydifficult to separate military from economically relevant activities, for instance,hydrographical and military surveys as distinct from marine scientific research. At thesametime,militaryactivitiesinornearcoastalstatemaritimejurisdictionareashavebeenincreasingly viewed as at best unwelcome and at worst posing serious threats theirnational interests.95 Indeed, there areunconfirmed reports thatChina is actively seekingthesupportofothercoastalstatesinanefforttointerpretUNCLOSinwaysthatcouldgivethem more legitimacy in opposing foreign military activities in EEZs under theirjurisdiction.Giventheunresolvedterritorialissues,whichresultinoverlappingclaimsandcris‐crossingEEZs,additionaldisputesarise.96These fundamental differences in the interpretation of either UNCLOS or customaryinternational lawhaveresultedinoccasionaltensionandescalationbetweentheU.S.andChinesemilitaries,suchastheEP‐3collisionofApril2001andtheImpeccable incidentofMarch2009.ThelattercaseinparticularcanbeseenasadirectchallengetotheabilityoftheU.S.tonavigateininternationalwatersorevenEEZsunencumbered.Additionally,U.S.concession to Chinese coercion could undermine its regional strategy and cause deepconcernsamongitsalliesandpartnersonitstrustworthy‐nessandreliabilityasasecurityguarantor.97Clearly,U.S.interestsintheregion,includingitsabilitytopreventproliferationofweapons ofmass destruction, piracy and illicit drug trafficking, aswell as its securityobligations to its allies and partners, require that the U.S. navy access military andcommercialsealanesunnumbered,includingfreedomofnavigationinEEZswithoutpriornotificationofmilitaryactivities.However, theU.S.positionsandprotestshavealsobeengreatlyunderminedbythefactthatithasyettoaccedetoUNCLOS.98

93 Swaine and Fravel, “China’s Assertive Behavior.” 94 Pedrozo, “Close Encounters at Sea”; Odom, “The True ‘Lies’.” 95 Mark Valencia, “Policy Forum 11-28: Intelligence Gathering, the South China Sea, and the Law of the Sea,” Nautilus Institute, August 30, 2011, http://nautilus.org/napsnet/napsnet-policy-forum/intelligence-gathering-the-south-china-sea-and-the-law-of-the-sea/  96 Valencia, Foreign Military Activities in Asian EEZs; private conversation with security analysts. 97 Oriana Skylar Mastro, “Signaling and Military Provocation in Chinese National Security Strategy: A Closer Look at the Impeccable Incident,” Journal of Strategic Studies 34:2 (April 2011), pp. 219-244. 98 Mark J. Valencia, Foreign Military Activities in Asian EEZs: Conflict Ahead? NBR Special Report #27 (Seattle, WA: The National Bureau of Asian Research, May 2011). There are growing calls for U.S. ratification of the UNCLOS, with the Senate in recent months holding hearings where Obama administration ranking officials,

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The implications for theU.S. areenormous.Militaryactivities in theopenseas, includingwithin EEZs of coastal countries, are recognized right under international law. UNCLOSallows coastal countries to exercise jurisdiction over resource use and environmentalprotection, but does not give them the right to restrict foreignmilitary activities unlessthey affect the natural resources or are tied to marine scientific research.99 ForWashington, Beijing’s behavior could gradually erode the foundation of internationalmaritime law through its interpretation of the existing law and by stipulating its ownmaritime law. In particular, the traditional interpretation of the law of sea is beingchallenged,bytransformingEEZsfromzonesofjurisdictionoverresourcesrightstomoreexpansive assertions of what constitutes marine scientific research subject to priorconsent.100Alsoatstake,accordingtoU.S.analysts,aretheinternationalrulesoftheroad,in particular where navigational safety is concerned. Soon after the Impeccable incidenttook place, the Commander of U.S. Pacific Command, Admiral Timothy Keating, testifiedbefore theU.S. SenateArmedServicesCommittee stating that the incident “is certainlyatroubling indicator that China, particularly in the South China Sea, is behaving in anaggressive, troublesomemanner and [is] notwilling to abide by acceptable standards ofbehavioror ‘rulesof theroad’.” Inotherwords,evenwheredisputesover thecontentofrights like freedom of navigation remain unsettled, parties should still respect theConvention on the International Regulations for Preventing Collisions at Sea (COLREGs)thatgovernhowvesselsshouldoperatesafelyinthevicinityofothervessels.101China’s concern over U.S. aerial and maritime surveillance and intelligence gatheringactivitiesmustalsobeseeninthecontextofitsongoingdefencemodernizationprograms,including the Jin‐class Type 094 nuclear ballisticmissile submarines (SSBNs),which arebased in Sanya,Hainan Island.102EachType094will carry12 Julang‐2 (JL‐2)missiles, amodifiedversionoftheDF‐31witharangeof7,200km(4,500miles).103Whilethe2011PentagonreportonChinesemilitaryrecognizesthat“theJINandtheJL‐2willgivethePLA

including Secretaries of State Clinton and of Defense Panetta, and the Chairman of the Joint Chiefs of Staff all testifying in support of ratification. See Will Rogers, “Security at Sea: the Case for Ratifying the Law of Sea Convention,” Policy Brief (Washington, D.C.: Center for a New American Security, April 2012); Nina Hachigian, “China’s Rise Is A Big Reason to Ratify the Law of the Sea Convention,” Center for American Progress, June 12, 2012, http://www.americanprogress.org/issues/2012/06/law_of_sea_china.html/; Donna Cassata, “Military Leaders, Clinton Push for Sea Treaty,” The Associate Press, May 23, 2012. 99 Patrick M. Cronin and Robert D. Kaplan, “Cooperation from Strength: U.S. Strategy and the South China Sea,” in Cronin, Cooperation from Strength, pp. 5-30; Alice D. Ba, “Staking Claims and Making Waves in the South China Sea: How Troubled Are the Waters?” Contemporary Southeast Asia 33:3 (December 2011), pp. 269-291. 100 James Kraska, “Sovereignty at Sea,” Survival 51:3 (June-July 2009), pp. 13-18; Peter A. Dutton, “Cracks in the Global Foundation: International Law and Instability in the South China Sea,” in Cronin, Cooperation from Strength, pp. 69-81. 101 Jonathan G. Odom, “The True ‘Lies’ of the Impeccable Incident: What Really Happened, Who Disregarded International Law, and Why Every Nation (Outside of China) Should Be Concerned,” Michigan State Journal of International Law 18:3 (May 2010), pp. 411-452, direct quote at p. 427. See also, “Maritime Disputes and Sovereignty Issues in East Asia,” hearing before the Subcommittee on East Asian and Pacific Affairs of the Committee on Foreign Relations, United States Senate, One Hundred Eleventh Congress, First Session, July 15, 2009. 102 Buszynski, “The South China Sea,” p. 146. 103 Robert S. Norris and Hans M. Kristensen, “Chinese Nuclear Forces, 2011,” Bulletin of the Atomic Scientists 67:6 (November/December 2011), pp. 81-87.

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Navy its first credible sea‐basednuclear capability,” it points to repeated delays in theirdeployment.104MarkValencia,aveteranobserveroftheSouthChinaSeadisputes,makesthisobservation:

IstheUnitedStateslegallycorrectinitsassertionof“freedomofnavigationandoverflightofthehighseas”tojustifytheoperationofitsmilitaryaircraftand vessels in other states’ EEZs? The answer is neither simple norstraightforwardanddependsinpartonwhatexactlytheaircraftandvesselsare doing—which is for the most part classified. In the case of the EP‐3incident,somehavespeculatedthattheelectronicintelligence(ELINT)plane,ratherthanpassivelycollectingdata,wasactively“tickling”China’sonshoredefence communications and interfering with shore‐to‐submarinecommunicationInthecaseoftheImpeccable,ithasbeenspeculatedthattheshipwastrackingChina’snewestnuclearsubmarines.105

OtherdevelopmentsinChina’sdefencemodernizationeffortsanddoctrinaldevelopmentsalso draw U.S. attention, and that explains its continued military surveillance andintelligencegatheringactivitiesintoChineseEEZs.Oneistheconceptof“anti‐access”—theidea of disrupting, weakening, and denying U.S. ability to deploy troops to overseastheatersofoperationsgiventheAmericanmilitary’sdependenceonsuchassetsasforwardbasing, depots, information networks, SLOC, among others, to ensure operationaleffectivenessandsuccesses.106ARANDstudydefinesananti‐accessmeasureas“anyactionby an opponent that has the effect of slowing the deployment of friendly forces into atheater, preventing them from operating from certain locations within that theater, orcausingthemtooperatefromdistancesfartherfromthelocusofconflictthantheywouldnormallyprefer.”107Another development is an emerging missile‐centric strategy. China has reportedlydeployedanewvariantoftheDF‐21MRBM.TheDF‐21Dground‐basedanti‐shipballisticmissile (ASBM), equipped with a maneuverable reentry vehicle (MaRV), which can hitmoving targetswith a range of 1,650 km, has reached an “initial operational capability”(IOC),according toastatementmadeby theU.S.PacificCommand(PACOM)CommanderADMRobertWillard. This assessment has been confirmed by the Chinesemedia and byTaiwan’s National Security Bureau Director Tsai Der‐sheng at a March 2011 testimonybefore the Legislative Yuan.108 A Taiwan defence source suggests that up to 12 DF‐21D

104 Department of Defense, Report to Congress: Military and Security Developments Involving the People’s Republic of China (Washington, D.C.: Office of the Secretary of Defense, August 24, 2011), pp. 3-4. 105 Valencia, Foreign Military Activities in Asian EEZs, p. 11. 106 Andrew Krepinevich, Barry Watts, and Robert Work, Meeting the Anti-Access and Area-Denial Challenge (Washington, D.C.: Center for Strategic and Budgetary Assessments, 2003). 107 Roger Cliff et al., Entering the Dragon’s Lair: Chinese Antiaccess Strategies and Their Implications for the United States (Santa Monica, CA: RAND, 2007), p. 11. 108 Mark Stokes, “Expansion of China’s Ballistic Missile Infrastructure Opposite Taiwan,” AsiaEye, April 18, 2011; Pradun, p. 13.

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ASBMshavebeendeployedinsouthernChina.109DF‐21Dhasbeendescribedasthecarrierkiller,themostlethalweaponthatisdesignedtotargetmovingaircraftcarrier.110Thesedevelopmentsmustbeplacedwithinthebroadergeo‐politicaltransformationtakingplace in the Asia‐Pacific. U.S. wars in Afghanistan and Iraq over the past decade and itsfixationontheglobalwaronterrorhaveresultedininconsistentpolicyandinattentiontotheregion.Meanwhile,China’srapideconomicdevelopmentoverthepastdecadeand itscharm offensive in Southeast Asia, have greatly enhanced its position. Chinese militarydevelopments, especially its naval buildup and growing anti‐access and area‐denialcapabilities, are beginning to challenge U.S. preeminence in Western Pacific. While theprincipaldriverforChinesedefencemodernizationhasbeentodeterandtoraisethecostsof U.S. intervention in the Taiwan Strait, increasingly, the Chinese military is lookingbeyondTaiwan todevelopandprojectpowerpast the first islandchainand increasinglyalsowestwardtotheIndianOceanRegion.111However, growing naval capabilities, including but not limited to submarines, andincreasedpatrols,couldresultinmoreaccidents,withpotentiallyseriousconsequences.112ChinaandtheU.S.inparticular,haveinrecentyearsentangledinanumberofhigh‐profileincidents such as the2001EP‐3mid‐air collisionand the2009 Impeccable incident. Theexisting bilateral confidence building arrangements such as the Maritime MilitaryConsultativeAgreement and the annualDefenseConsultativeTalks have yet to establishclearrulesoftheroad.113ThisisduelargelytothemajordifferencesbetweenChinaandtheUnited States regarding the merits, the modality, and the sequence of establishingconfidence‐buildingmeasures(CBMs).ForWashington,developingCBMs,especiallywhereoverlapping interests and maritime encounters are growing, is critical to managingpotential disputes and prevent minor incidents from escalating to major confrontation.Beijing, on the other hand, continues to insist that strategic trust and intention mustprecedeanyspecificCBMs,andspecifically,isreluctantinacquiescingU.S.rightstomilitarysurveillanceandintelligencegatheringclosetoChina’sterritorialwaters.114

109 Wendell Minnick, “China Ramps Up Missile Threat with DF-16,” DefenseNews, March 21, 2011. 110 Erik Sofge, “China’s Deadliest Game,” Popularmechanics.com (December 2010), pp. 78-85, 129. 111 Toshi Yoshihara and James R. Holms, Red Star over the Pacific: China’s Rise and the Challenges to U.S. Maritime Strategy (Annapolis, MD: Naval Institute Press, 2010); Phillip C. Saunders et al., The Chinese Navy: Expanding Capabilities, Evolving Roles (Washington, D.C.: National Defense University Press, 2011); James R. Holmes and Toshi Yoshihara, “China’s Naval Ambitions in the Indian Ocean,” The Journal of Strategic Studies 31:3 (June 2008), pp. 377-378. 112 Chris Rahman and Martin Tsamenyi, “A Strategic Perspective on Security and Naval Issues in the South China Sea,” Ocean Development & International Law 41 (2010), pp. 315-333; Sam Bateman, “Perils of the Deep: The Dangers of Submarine Proliferation in the Seas of East Asia,” Asian Security 7:1 (2011), pp. 61-84. 113 Mark Valencia and Guoxing Ji, “The ‘North Korean’ Ship and the U.S. Spy Plane Incidents: Similarities, Differences, and Lessons Learned,” Asian Survey 42:5 (September/October 2002), pp. 723-732; Raul Pedrozo, “Close Encounters at Sea: The USNS Impeccable Incident,” Naval War College Review 62:3 (Summer 2009), pp. 101-111. 114 For a recent analysis of this issue, see Rory Medcalf and Raoul Heinrichs, with Justin Jones, Crisis and Confidence: Major Powers and Maritime Security in Indo-Pacific Asia (Sydney: Lowy Institute for International Policy, June 2011).

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But as the EP‐3 and the Impeccable incidents demonstrate, without proper rules of theroad, future incidents could re‐occur and risks exist for escalation, leading to militaryconflictsthatneithersidewouldbenefit.Inthiscontext,the1972U.S.‐SovietAgreementonthePreventionofIncidentsatSeawouldstillbevaluable.115However,asthecommanderofU.S Pacific Navy suggests there are more than philosophical differences that impede ahealthydevelopmentofmilitary‐to‐militaryrelationship.BeijingisdeeplydistrustfulofU.S.intentions in the region and it continues to link the Taiwan arms sale issue to thedevelopment of comprehensive U.S.‐China military ties.116 Granted, due to differenthistorical experiences, threat perceptions, strategic culture, there will be differentexpectations, interpretations,andthereforedifferentdegreesofreceptivity todevelopingconfidence building measures. Nonetheless, these should not be allowed to become theexcuse and obstacles to developing mechanisms for safe management of maritimeoperations.117ConcludingRemarksSeveraltentativeconclusionscanbedrawnfromthereport.First,disputesovermaritimesovereigntyintheSouthChinaSeahavebeengoingonforwelloverfourdecades,whiletheintensityandmanifestationvarydependingonthelargergeo‐strategicenvironmentsintheregion.Althoughsolutiontosovereigntyissuesandindeedtheirclarificationremainsoutofreachatthemoment,thelatestcontentionreflectsclaimantstates’effortstostakeoutandstand firmon their positions, in the hope that occupation, continuous administration, orjustrepeatedclaimswillenablethemtoestablishlegitimacyandnegotiatefrompositionsof strength in the future. It can be argued that beyond these limited goals, none canrealisticallyandforcefullyimposeitsownversionofsovereignty,norhasanycountryhadthetechnicalmeanstotaptheyettobedeterminedresources,withtheshowsofresolveifnotforceitselflargelyhavingthedomesticconstituenciesinmindbuthighlydisruptiveofregionalpeaceandstability,underminingeach’sfundamentalsecurityinterestsinthelongrun.Second, for risingpowers likeChina, theSouthChinaSeadisputesraisemore important,strategic, questions. How to uphold sovereign claims over the vast maritime territorieswithout currently being capable of enforcement, while threats and rhetoric can bedistractive, reputation‐tarnishing, and counterproductive to its long‐term goals ofexercising influence through soft power and economic interdependence. Theseconsiderationsmost likely explainBeijing’s recentmoderationofpolicy stance, a tacticalshift that can strengthen its broader strategic positions, not a sign of abandoning its

115 Sean M. Lynn-Jones, “A Quite Success for Arms Control: Preventing Incidents at Sea,” International Security 9:4 (Spring 1985), pp. 154-184. 116 “Statement of Admiral Robert F. Willard, U.S. Navy Commander, U.S. Pacific Command, before the Senate Armed Services Committee on U.S. Pacific Command Posture,” February 28, 2012. 117 David Griffiths, U.S.-China Maritime Confidence Building: Paradigms, Precedents, and Prospects (New Port, RI: China Maritime Studies, Naval War College, July 2010)

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sovereigntyclaims.118Atthesametime,territorialdisputes,theTaiwanissue,andChina’sgrowingdependenceonmaritimetradeandresourceimportshavepresentedtheChinesemilitarywithnewchallengesandmissions.ThesewouldincludeassertingmaritimerightsintheWesternPacificwithaviewtodeterringU.S.fromnavalinterventionincross‐Straitrelations and the need to focus onmaritime power projection into the Indian Ocean tosecurethesafesuppliesofthecountry’senergyimportsandmaritimetrade.Third,U.S.determinationtoretainitsnavigationalrightsanditsabilitytoaccessEastAsianmarketsandprovideassistancetoitsallieshasbeenandwillcontinuetobechallengedbyChina, which considers such posture as at least unwelcome and at most hostile.Increasingly, Beijing explains its actions—seen by the U.S. navy as highly risky andunjustified—asbasedonUNCLOSdefinitionsoncoastalstatesrightsandjurisdictionoverEEZs and consequently the rightful restrictions on military activities of foreign vessels.Washington rejects such claims and interpretations. However, such differences anddeterminedpursuitsbybothsidestoassertitsrightscouldleadtomajorincidents,astheEP‐3andImpeccablehavedemonstrated.TheexistingbilateralmilitaryCBMarrangementssuch as the MMCA and DCT have proved inadequate in responding to and managingpotentialcrisis.Indeed,theoverallmilitary‐to‐militarycontactsremaintheweakestlinkinbilateral relations.119 This being the case, much needs to be done and both Beijing andWashingtonmustappreciatethedangerofmisunderstandingandescalation.Thisrequiresboth bilateral (U.S.‐China and China vis‐à‐vis its key claimant states) and multilateralefforts(ARF,ASEANplusone,plusthree,EastAsiaSummit)forcrisismanagement,conflictcontrol,andconfidencebuilding.Finally,understandingandrecognizingtheroleofdomesticactorsinforeignpolicymaking,especially in what are traditionally viewed as authoritarian and unitary states such asChinaandVietnamiscriticaltoidentifyingthesourcesofconflictsandinlocatingtherightinterlocutorsformeaningfuldialogueandnegotiationamongkeyclaimants.Relatedtothisargument is the question of whether assertive behavior in these countries typically isreflective and in alignment of domestic leadership transition. A preliminary assessmentwouldsuggestthatincreasinglynationalismimposessignificantlyconstraintsonhowmuchconcession (perceived or real) can be tolerated. The growing difficulty in informationcontrolmakescensuringpublicopinionsamoredauntingtask.Theincreasingnumbersofactorsandlackofcoordinationcanleadtolessthanoptimalpolicyenforcementasmuchasthey can cause diplomatic problems. And diverse views exist even in what is normallyconsidered as the group holding the hardest lines—the Chinese military, but these aremore on tactics or approaches rather than fundamental principles and stances onsovereignty.

118 M. Taylor Fravel, “All Quiet in the South China Sea: Why China Is Playing Nice (For Now),” Foreign Affairs, snapshot, March 22, 2012, http://www.foreignaffairs.com/articles/137346/m-taylor-fravel/all-quiet-in-the-south-china-sea. 119 Shirley A. Kan, U.S.-China Military Contacts: Issues for Congress (Washington, D.C.: Congressional Research Service, June 19, 2012). 

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AppendixMajorDevelopmentsRelatedtotheSouthChinaSea 

Date Parties Involved What Happened? Outcome/Solution

March 5, 2009

US and China Major Incident - PLA-Navy and Y-12 aircraft ‘shouldered’ the USS Impeccable. - Shadowed and maneuvered by 5 Chinese ships. - Chinese attempted to cause the Impeccable to collide.

- US and China both maintained rightfulness of their actions based on their different interpretations of the UN Convention on the Law of the Sea. - US used the Freedom of Navigation program to challenge the territorial claims by China.

June, 2009 US and China Major Incident Chinese submarine followed US Jon S. McCain. Colliding with and damaging its towed array sonar instrumentation.

July, 2010 US, China and other East Asian regional countries.

Fishing incidents at sea/High-level meeting Chinese vessel collided with Japanese. Beijing withheld shipments from Japan. US offered to facilitate talks between China and its neighbours.

China refused, knowing that the US had new and old allies in the region.

March 2, 2011

Philippines and China

Incident at sea Philippines oil exploration vessel was sandwiched between 2 Chinese naval boats, intimidating them to drive it away from the area.

- Manila dispatched 2 warplanes and a bomber to deter the intruding Chinese gunboats. - Lodged a strong diplomatic protest with Beijing over harassment but it was shrugged off.

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May, 2011 Philippines and China

Major Incidents - Two Chinese fighter jets had flown over the Philippines territory in the Spratly Islands - Control over this is an issue of sea-lane control, the ability to interdict sea-lanes, and the potential for deep-sea resource mining.

May, 2011 Vietnam and China

Vietnam protested China’s annual imposition of a fishing ban from May to August.

May-June, 2011

Philippines, Vietnam and China

Incidents at Sea - 3 Chinese maritime security naval vessels disabled a cable trailing of a Vietnamese oil exploration ship. - Forced the ship out of waters off Vietnam’s south-eastern coast. - Similar incidents occurred in May near Vietnam, and in March near the Philippines.

- Chinese said that the Vietnamese survey ship was operating illegally in their territory; therefore their actions were completely justified.

June, 2011 Vietnam and China

Vietnam protested Chinese naval ships using weapons to threaten Vietnamese fishermen.

June, 2011 Philippines and China

A Chinese patrol vessel reportedly fired at Philippines fishing vessels.

June, 2011 Philippines and China

- Foreign Secretary Alberto del Rosario’s visited the US. - Philippines asked the US for leverage against China.

June, 2011 Philippines and China

- 11-day US-Philippines naval exercise near the South China Sea - President Aquino pledged to bring the South China Sea dispute before the UN International Tribunal on the Law of the Sea.

June 3, 2011 Vietnam and China

High-level Meeting - International Institute for Strategic Studies (IISS) Asian Security Summit - Following the Vietnam-China

Both parties agreed to abide by: - UNCLOS (1982) - Declaration on the Conduct of Parties in the East Sea (DOC) - Settling the matter through

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incident in May, defence officials met in Singapore.

diplomacy.

June 13, 2011 Vietnam and China

Incidents at Sea Live-fire naval exercises by Vietnam, after several incidents straining relations between Vietnam and China.

June 17, 2011 China Major Military Exercise Military drills near South China Sea, following live-firing naval exercises by Vietnam.

June 27, 2011 US and China Meetings/Resolutions The US Senate unanimously passed a resolution deploring the use of force by China in the South China Sea, calling for peaceful and multilateral resolutions.

June, 2011 Philippines and China

Incidents at Sea Chinese surveillance ship and 2 marine vessels unloaded building materials and buoys, and put up posts on the reefs claimed by Manila.

Diplomatic flare-up between Beijing and Manila.

July, 2011 US and China Meetings/MMCA - Chairman of Joint Chiefs of Staff of both states met in Beijing. - China criticised US' joint exercises with Vietnam and the Philippines. - US maintained its support to its allies in the region.

October, 2011

Philippines-China

Incidents at Sea - Philippines warship accidentally struck a Chinese fishing boat. - Incident occurred amid joint US-Philippines marine drills/war games.

The Philippines Navy apologised to China.

September21-22, 2011

US and China China announced severed obstacles to normal military-to-military exchanges between the 2 countries, following US arms sale to Taiwan.

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November, 2011

US and China High-level Meeting - East-Asia Summit - President Obama and Premier Wen Jiabao held an unscheduled meeting on the sidelines - Discussed the South China Sea.

November, 2011

US and China High-level Meeting - Defense Consultative Talks (DCT) - China’s acceptance of US calls to put bilateral military relationship on a more reliable/continuous footing - US reiterated ensuring freedom of navigation.

December, 2011

US and China High-level Talks 4t high-level dialogue between the Communist Party of China and the Republican and Democratic parties of the US

December, 2011

US and China Implementation of the Megaport Initiative to monitor for “nuclear and other radioactive materials in cargo containers” at Shanghai’s Yangshan Port.

March, 2012 US Major Military Exercise Military drills, with the Philippines, near South China Sea have been confirmed for next month.

March, 2012 China Major Military Exercise 11th detachment of Chinese navy’s anti-piracy operation carried out live fire training.

April-June 2012

China, the Philippines

Territorial Dispute Over two-month standoff in the Scarborough Shoal

Diplomatic efforts have not led to the resolution of the issue, with escalation of rhetoric but restrained naval/maritime enforcement maneuvers

June 2012 China, Vietnam Territorial Dispute Over Vietnam’s passage of its maritime law

Beijing reiterates its positions on “irrefutable sovereignty” over the Paracel and Spratly Islands

July 2012 ASEAN ASEAN foreign ministers meeting in Phnom Penh, Cambodia

ASEAN meeting failed to issue communiqué due to disagreement on how to address the South China Sea territorial disputes