Raising the Stakes
The Interests of Non-claimant States in the South China Sea Disputes

The geopolitical game playing out in the South China Sea is becoming more complicated. China’s increasingly provocative actions are forcing regional players—from near and far—to make clear their interests and positions on the ongoing territorial disputes. In December 2015, the commander of the U.S. Pacific Fleet issued a tough warning against China’s attempt to establish “so-called military zones” around its artificial islands and criticized its unilateral assertiveness as unacceptable. [1] Although a non-claimant, the United States, given its role as a regional security guarantor, has long been an important stakeholder in the management and settlement of the disputes. However, China’s recent escalatory actions and behavior are leading more regional players to engage directly on South China Sea issues, both in the diplomatic arena and in the contested waters. Going forward, these non-claimant parties will likely play a greater role in influencing events in the South China Sea.

This Asia Policy roundtable provides a timely survey of regional perspectives from the most involved non-claimant states, Australia, India, Indonesia, Japan, Singapore, South Korea, and the United States—as well as two multilateral organizations, the Association of Southeast Asian Nations (ASEAN) and the European Union. Despite their geographic, political, and economic differences, it is clear that very real strategic interests drive all these non-claimant stakeholders when it comes to developments in the South China Sea. This is perhaps unsurprising given regional stakeholders’ dependence on critical sea lines of communication for shipping. The South China Sea contains the main arteries of global trade, with more than $5 trillion of the world’s seaborne trade passing through its waters every year. [2] These are also vital energy lifelines, providing transit for a third of global crude oil and half of global liquefied natural gas. [3] For East Asian countries like South Korea and Japan, dependence is particularly acute with approximately 66% and 60%, respectively, of their energy imports passing through the South China Sea. [4] Given vested economic interests, these regional stakeholders are wary of disruptions to trade from a geopolitical crisis, or outright conflict, over the contested waters.

Another commonality among the non-claimant states is a fundamental interest in maintaining freedom of navigation and the rights of passage and overflight in the South China Sea. All of the non-claimants also call for peaceful resolution of the disputes in accordance with international norms and law. This is particularly true for the two multilateral institutions examined here. ASEAN, as Alice Ba argues, needs to see a peaceful, negotiated outcome to the disputes; anything less would threaten the organization’s fundamental approach of pursuing consensus-based solutions in the face of great-power interests. For the European Union, which, as Mathieu Duchâtel notes, sees itself as a normative power, failure to support international legal outcomes would similarly threaten the institution’s approach to collective security. Efforts by non-claimant parties to uphold a rules-based order and preserve access to the maritime commons can help consolidate a broader understanding of acceptable actions by the claimant states. Over time, this may reinforce pressure on any claimants that choose to engage in unacceptable behavior.

Beyond diplomatic statements calling for de-escalation and peaceful resolution of the disputes, several of the non-claimant states have undertaken specific maritime deployments in the South China Sea to signal their interest, concern, and resolve. These range from the high-profile freedom of navigation operations undertaken by the United States, which Admiral Thomas Fargo describes, to quieter missions undertaken by Australia, which Rory Medcalf notes signal that Canberra will continue to assert its rights and encourage a rules-based approach. India, Abhijit Singh writes, has also increased its operational presence in the South China Sea, with a contingent of four frigates completing a two-month tour in June 2015 and one frigate making a subsequent deployment to the Philippines in November.

Several non-claimant states have also stepped up their military cooperation with and arms sales to some of the Southeast Asian claimants. India has strengthened its military engagement with Vietnam and Malaysia. Japan, Admiral Yoji Koda notes, has commenced initiatives to improve the maritime and coast guard capabilities of some of its Southeast Asian partners, including Vietnam and the Philippines, to help alleviate political and military pressure from China. Several European countries are also helping strengthen the maritime and coast guard capabilities of the Southeast Asian claimants. Vietnam has placed orders to purchase frigates from the Netherlands and anti-ship cruise missiles from France, while the Philippines is importing French and Italian armed light helicopters. These still-modest measures are not attempts to take sides or encourage militarization of the disputes. Rather, they are part of non-claimants’ efforts to shore up important relationships, prevent the escalation of tensions, and signal concern to China.

However, there are other factors beyond these shared economic and security interests driving the non-claimants’ overall positions. As noted by several of the contributors to this roundtable, some non-claimants hold unique geostrategic concerns. For Japan and South Korea, as Lee Jaehyon argues, the outcome of the South China Sea disputes could set a precedent for the separate territorial disputes in which each is embroiled—Japan with China over the Senkaku/Diaoyu Islands in the East China Sea, and South Korea with Japan over the island grouping of Dokdo/Takeshima in the Sea of Japan. For India, as Singh notes, China’s actions in the South China Sea are perceived as part of a broader strategy to establish a Chinese naval presence in the Indian Ocean, and Indian concern about this helps inform New Delhi’s responses to the disputes. These distinct national interests add a challenging dimension to the already strong interests in trade and freedom of navigation that drive these major powers’ approach to the disputes.

For most of the non-claimants studied here, the South China Sea disputes are also viewed through the lens of regional geopolitics. China’s increasing assertiveness in the South China Sea, coupled with its growing power and profile on the global stage, seems designed to challenge the U.S.-led regional order that has prevailed since the end of World War II. This perception has implications for U.S. treaty allies Japan, South Korea, and Australia, as well as for ASEAN.

As the sovereignty disputes divide China and ASEAN claimants, non-claimant ASEAN member states are seeking to bring the China-ASEAN relationship back on track. Jane Chan notes that Singapore is working to ensure that ASEAN remains cohesive by serving as an “honest broker.” Similarly, Ristian Atriandi Supriyanto emphasizes how Indonesia leverages its non-claimant status—even downplaying the ambiguities of its own maritime boundaries with China—to elevate its diplomatic prestige in order to deal more effectively with the claimants (an important national interest, given Indonesia’s role as primus inter pares within ASEAN).

Another geopolitical concern is the broader U.S.-China strategic rivalry in the Asia-Pacific. When the South China Sea dispute is seen as a proxy for U.S.-China strategic competition, states begin to weigh their interests and decisions in the context of their alliance or partnership arrangements (in most cases with the United States) and their (generally extensive) trade and economic relationships with China. This is a delicate balancing act for U.S. allies and non-allies, as well as claimants and non-claimants, alike.

The result, for most, is a strategic dilemma in which a determination to take a more vigorous stance on international norms and rules is tempered by the potential economic costs of aggravating China—especially when the anticipated costs of doing so might outweigh the perceived ability to influence China’s behavior. The result during the past year or so, when China’s island-building and other activities have been increasingly provocative, has been to temper the response of both claimant and non-claimant states, further complicating their considerations and resulting in attempts to avoid making definitive statements. Yet, as Medcalf cautions, doing nothing is sometimes the most harmful course. Even the most deliberate and pragmatic hedging strategy may be difficult to sustain if events unfold beyond the non-claimants’ control.

International legal considerations, which all non-claimant states have declared to be one of their highest priorities in relation to the disputes, are likely to force governments to make clearer decisions in the coming year. As noted in several essays, the Philippines’ case against China at the International Tribunal for the Law of the Sea is currently under consideration, and the ruling is expected in 2016. Assuming there is a clear and definitive outcome, the ruling will likely force all the non-claimants to think carefully about the decisions each will have to make, depending in part on the behavior and responses of the two parties. China has already stated that it does not recognize the disputes as falling within the jurisdiction of the tribunal and that it has no intention of honoring the ruling. But given the importance that each of the non-claimants examined here has placed on peaceful resolution of the disputes, and the broader strategic stakes each has in maintaining a rules-based international system, their support for this ruling will be an important indicator of the kind of order that is emerging in East Asia.

Endnotes

[1] Jane Perlez, “U.S. Navy Commander Implies China Has Eroded Safety of South China Sea,” New York Times, December 15, 2015, http://www.nytimes.com/2015/12/16/world/asia/us-navy-commander-implies-china-has-eroded-safety-of-south-china-sea.html. The full speech is available at http://www.cpf.navy.mil/leaders/scott-swift/speeches/2015/12/cooperative-strategy-forum.pdf.

[2] Tim Kelly, “U.S. Navy Commander Warns of Possible South China Sea Arms Race,” Reuters, December 15, 2015, http://in.reuters.com/article/southchina-usa-idINKBN0TY03F20151215.

[3] “The South China Sea Is an Important World Energy Trade Route,” U.S. Energy Information Administration, April 4, 2013, http://www.eia.gov/todayinenergy/detail.cfm?id=10671.

[4] Robert D. Kaplan, “Why the South China Sea Is So Critical,” Business Insider Australia, February 20, 2015, http://www.businessinsider.com.au/why-the-south-china-sea-is-so-crucial-2015-2.

Tiffany Ma is Director of Political and Security Affairs at The National Bureau of Asian Research.

Michael Wills is Senior Vice President for Strategy and Finance at The National Bureau of Asian Research.