ASEAN and the South China Sea
Deepening Divisions

An Interview with Ian Storey

Ann Jung
July 16, 2012

Discussion of rising tensions over competing territorial claims in the South China Sea was a top priority for foreign ministers at the ASEAN Regional Forum in Cambodia on July 11–12. In recent months, the region has seen military buildup among disputing nations, a confrontational naval standoff between China and the Philippines, China’s recent invitation for bids to explore nine oil and gas blocks within Vietnam’s claimed exclusive economic zone, and other unfriendly exchanges. These incidents have made the South China Sea a hot-button issue among claimants and raised concerns throughout the international community.

NBR asked Ian Storey (Institute of Southeast Asian Studies) for his insights into developments in the South China Sea, divisions between ASEAN members at the recent ASEAN-led meetings in Cambodia, and what this means for regional stability.

How has the South China Sea dispute escalated over the past year? What has driven the escalation?

Tensions in South China Sea tend to be cyclical. In the first six months of 2011 there was an upsurge, followed by relative calm in the second half of the year. In the first six months of 2012, tensions began to rise again, peaking in May–June when Chinese and Philippine patrol boats were involved in a prolonged standoff at Scarborough Shoal. Political tensions over the South China Sea dispute reached a crescendo at the recent ASEAN-led meetings in Phnom Penh. Sharp divisions within the Association of Southeast Asian Nations (ASEAN) over the problem were brought into sharp relief when the foreign ministers failed to agree on a final communiqué for the first time in the organization’s 45-year history. Consensus could not be reached because the Philippines and Cambodia disagreed on whether the Scarborough Shoal incident should be mentioned in the communiqué. Events in Phnom Penh underscore not only that the dispute is becoming a more contentious issue between China and some of the ASEAN claimants, but also that it is deepening divisions within ASEAN itself.

While tensions might be cyclical, the central drivers remain unchanged: growing nationalism concerning ownership of the atolls in the South China Sea, rivalry over access to maritime resources, and the ongoing militarization of the dispute. What we see in the South China Sea is an action-reaction dynamic in which the Southeast Asian claimants (especially the Philippines and Vietnam) are reacting to what they perceive as increasing Chinese assertiveness, while China is responding robustly to what it sees as illegal and provocative actions undertaken by its smaller neighbors. If present trends persist, this cycle will continue and probably accelerate.

The South China Sea was reportedly the top security issue on the agenda of the recent ARF meeting in Cambodia. Prior to the ARF meeting, the ASEAN foreign ministers had announced their intention to agree on text for a code of conduct (CoC) in the South China Sea to negotiate with China. What prevented agreement among the ASEAN foreign ministers? How useful would a code of conduct be in reducing tensions?

In late 2011, ASEAN and China agreed to start negotiations on a CoC for the South China Sea, an agreement that was meant to be formal and binding. ASEAN members began discussing guiding principles for the CoC in January, but the process quickly ran into problems due to divisions within ASEAN between members that have claims in the South China Sea and those that do not (and even divisions among the four ASEAN claimants themselves, the Philippines, Vietnam, Malaysia, and Brunei). The Philippines wanted the code to move beyond conflict management to include conflict-resolution mechanisms outlined in its 2011 proposal to transform the South China Sea into a “zone of peace, freedom, friendship and neutrality.” Other members apparently resisted this move.

In the end a compromise document was produced, outlining “proposed elements” for the CoC. I have seen this document, and it is rather disappointing. There is nothing new in it at all, and certainly nothing that would make it “legally binding,” as originally envisioned. The document identifies some existing dispute-resolution mechanisms under “international law,” presumably the International Court of Justice (ICJ); the UN Convention on the Law of the Sea (UNCLOS), which includes a body known as the International Tribunal on the Law of the Sea (ITLOS) that can, among other things, make rulings on disputed maritime boundaries; and the 1976 ASEAN Treaty of Amity and Cooperation (TAC), to which China acceded in 2003 and which includes a provision to assemble a high council to resolve disputes among members. However, they all have limited utility when it comes to achieving a resolution of the dispute. China has ruled out legal arbitration either at the ICJ or ITLOS, and the high council has never been operationalized and would, in any case, be highly politicized (this is why several ASEAN members have submitted bilateral territorial disputes to the ICJ instead).

The proposed elements are thus already weak, and this is before ASEAN sits down with China to frame a final agreement. My guess is that China will demand that all language referring to dispute-resolution mechanisms be removed on the grounds that the problem is a bilateral issue that should be resolved between China and each of the claimants separately. The ASEAN secretary-general, Surin Pitsuwan, wants a CoC signed in November, the tenth anniversary of the Declaration on the Conduct of Parties in the South China Sea (DoC). If ASEAN and China do reach agreement on a code (and the Chinese deputy foreign minister Fu Ying has stated that his country will only sign such an agreement “when the time is ripe”), it is likely to be long on symbolism and short on substance. An agreement is unlikely, therefore, to have a significant impact on reducing tensions in the South China Sea or moving the dispute toward a resolution.

Was there any progress on the South China Sea, as Secretary of State Hillary Clinton had called for prior to the ARF?

No, there was not. But to be frank, given the divisions within ASEAN, and China’s opposition to the dispute being discussed at all at the ARF, it was always highly unlikely that any progress would be achieved. Moreover, keep in mind that the ARF was not designed to resolve disputes. It is merely a forum for 27 foreign ministers to discuss regional security problems.

Two weeks before the ARF meeting, China announced that it will deploy “combat-ready” naval and aerial patrol units to the Spratly Islands. How has this changed regional dynamics and thinking about China and the South China Sea?

I suspect that China made this announcement following Vietnam’s statement that it had flown regular air patrols over the Spratlys using SU-30 jet fighters. It is another example of the action-reaction dynamic I referred to earlier. Yet both developments provide further evidence that the claimants are hardening their positions over their territorial and maritime boundary claims and messaging the other claimants that they are prepared to employ military force if push comes to shove. Yet to be honest, there is a certain amount of posturing going on, and I don’t envisage a major conflict in the South China Sea any time soon. However, bellicose posturing and the increasing frequency of incidents at sea (such as the standoff at Scarborough Shoal) raise the risk of an accidental clash that could escalate into a more serious military or political crisis. To my mind, it is just a question of time before one of these incidents turns really ugly and people get killed and hurt.

Immediately prior to the ARF meeting, China invited bids for oil exploration inside nine blocks within Vietnam’s claimed exclusive economic zone. What are the implications of China’s announcement?

I think this is a very worrying development. China has refused to clarify the exact effect of its nine-dashed line map, but some experts have opined that Beijing is gradually bringing its claims into line with UNCLOS. However, the announcement by the China National Offshore Oil Company (CNOOC) offering the nine blocks for tender suggests the opposite. It indicates that the nine dashes represent the outermost limits of what China calls its “historic rights” in the South China Sea, including ownership of maritime resources such as oil, gas, fish, and minerals. While UNCLOS allows states to exercise “historic rights” in their territorial waters, this right does not extend to the high seas. Moreover, the nine blocks are clearly within Vietnam’s two-hundred nautical mile exclusive economic zone, and therefore CNOOC’s offer is incompatible with UNCLOS and infringes on Vietnam’s sovereign rights. Given the dubious legality of CNOOC’s tender, I seriously doubt if any international energy company will bid for rights to explore these blocks.

Commentators in the Philippines have accused China of using its size to bully its neighbors, following a recent standoff between the two countries in the disputed Spratly Islands. Is a U.S. military presence necessary to balance out power in the region? How would the U.S.-Philippines Mutual Defense Treaty (MDT) shape U.S. involvement?

Many countries in Asia feel that the only country that is capable of sustaining a balance of power is the United States. Against the backdrop of a rising China, Southeast Asian countries generally have welcomed the U.S. “pivot” or “rebalancing” toward Asia (or rather they welcome the rhetoric while remaining unsure of the United States’ long-term commitment, given its daunting financial problems).

In reaction to what it perceives as growing Chinese assertiveness in the Spratlys, the Philippines has looked to strengthen its alliance relationship with the United States and has asked Washington to transfer excess military equipment to bolster the capabilities of the Philippine armed forces. Manila has also sought clarification from Washington on the applicability of the MDT to situations in the South China Sea. Manila seems to think that the MDT covers contingencies in the area, whereas the U.S. position is that the Spratlys are not covered by the MDT because they were only formally claimed by the Philippines in 1978, 27 years after the treaty was signed. However, under the terms of the MDT, both sides would be obliged to consult if the Armed Forces of the Philippines (AFP) came under attack in the South China Sea. Although the United States has given strong rhetorical support to its alliance relationship with the Philippines, in the event of a clash in the South China Sea U.S. military assistance to the AFP would be “scenario dependent.”

What are the roles of regional powers such as Japan, India, and Australia in South China Sea disputes?

Countries such as Japan, India, and Australia have expressed concern at negative developments in the South China Sea and the potential for further instability and even conflict. This is understandable given that stability in the South China Sea is vital to all trading nations in the Asia-Pacific region because the busy sea lanes that pass through function as vital arteries of global commerce. Japan in particular has become increasingly concerned at the situation, both because it depends on those sea lanes for 90% of its oil imports and because it fears that if China persuades or coerces other countries to accept its interpretation of international law, this will negatively affect Japan’s interests (including in its own dispute with China over ownership of the Senkaku/Diaoyu Islands). Accordingly, Japan has tried to foster unity within ASEAN over “maritime security issues” (i.e., the South China Sea) and has started to provide the Philippine Coast Guard with capacity-building support. India and Australia are not really players in the dispute, but I expect that they will continue to express concerns at multilateral security forums.

What role is domestic politics playing in the approaches adopted by China, the Philippines, Vietnam, and other claimants to the disputes?

Popular nationalism concerning sovereignty of the disputed atolls is growing in intensity. This is especially true in China and Vietnam, but increasingly in the Philippines as well. Hanoi and Beijing have fueled nationalism to legitimize their regimes and, in the context of the South China Sea dispute, to send messages to other claimants. One example is the eleven consecutive weeks of anti-China protests that took place in Vietnam in 2011. But nationalism also limits the claimant’s room for maneuver, as any compromise over territorial or boundary claims would be interpreted as a sign of weakness and thus provoke a nationalist backlash. What this means is that the compromises that would be needed to achieve a negotiated settlement are now harder to broker, thereby further diminishing the prospects for a resolution to the South China Sea disputes.

From the view of the United States, what are the best- and worst-case scenarios for tensions in the South China Sea in the coming year?

The worst-case scenario for the United States, and indeed all stakeholders in the South China Sea, is a serious confrontation in which military force is employed. But frankly I think the chances of that happening are not very high. The best-case scenario is for China and ASEAN to agree on a credible and effective CoC that ameliorates tensions, leads to the implementation of confidence-building measures, and thereby creates an environment conducive to a peaceful resolution. I don’t think the chances of that outcome are very high either.

So I think what we will see for the foreseeable future is a continuation of the status quo in the South China Sea: tensions will continue to ebb and flow, the claimants will protest each other’s moves, and ASEAN and China will keep the DoC/CoC process going if only to show that they are doing something. How long the status quo can continue is another matter. I think it has a limited shelf life, though what the post–status quo will look like is impossible to say at this point in time. But it could be very messy.

Ann Jung is an Intern at The National Bureau of Asian Research. She holds a BS in Journalism and East Asian Studies from Boston University and is currently pursuing an MA in International Studies with a concentration in Korea at the University of Washington.