China and Asean reach ‘milestone’ draft deal on South China Sea code of conduct

Chinese foreign minister says consensus will speed up talks on a formal agreement for the resource-rich waters but observers question how much real progress has been made

PUBLISHED : Thursday, 02 August, 2018, 5:47pm
UPDATED : Tuesday, 07 August, 2018, 2:37pm

After more than a decade of talks, a bloc of Southeast Asian nations and China have agreed on a draft code of conduct that will lay the foundation for negotiations over the disputed South China Sea.

Observers said the agreement showed that China and the Association of Southeast Asian Nations (Asean) could make progress through talks despite rising regional tensions, but they also warned that there was still a long way to go until a final deal.

The agreement on the “Single Draft COC Negotiating Text” was announced at a meeting of Asean foreign ministers in Singapore on Thursday, after being nailed down at a China-Asean meeting in the central Chinese city of Changsha in June.

Collin Koh, a maritime security expert at the Nanyang Technological University in Singapore, said the consensus on the draft meant the claimants had a common set of terms of reference for future talks. Progress on the code of conduct could also work in Beijing’s favour, underscoring its desire for stability and for the United States to stay out of the dispute over the waters, Koh said.

“[Beijing] needs a foreign policy breakthrough to highlight its desire for peace and stability, and use it to further oppose external interference in the SCS,” Koh said.

“Beijing must have believed it has the upper hand and leverage now with its island-building complete, fortifications in place, and most importantly, having been able to go scot-free without paying any penalty for upping the ante in further militarising the area,” he said.

The document is an attempt to tamp down tensions that have risen as China has built artificial islands and military installations in the resource-rich waters that are also claimed by Malaysia, the Philippines, Vietnam and Brunei.

China and other claimants have sent military vessels to the disputed waters, increasing the risk of a major confrontation in an area through which billions of US dollars in trade flows each year.

China and Asean have long discussed ways to defuse those tensions but the talks have been hindered by sticking points such as the area the agreement should cover.

The announcement on the draft comes as China and the US are locked in a trade war and jockeying for influence in Asia. On Wednesday, US Secretary of State Mike Pompeo started a four-day visit to Asia to promote US investment in the Indo-Pacific region, a programme said to counter China’s “Belt and Road Initiative” to revive ancient trade routes.

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Jinan University Southeast Asian affairs specialist Zhang Mingliang said the tensions with the US might have prompted China to reinforce ties with its neighbours.

“It is likely that China will offer some concessions in the code of conduct negotiations and on economic cooperation,” Zhang said. “Considering how much pressure China has come under from the US, it can no longer be arrogant, otherwise it will be isolated.”

Calls for a binding code of conduct first surfaced in 1995 when China occupied Mischief Reef, a maritime feature claimed by the Philippines. China did not agree to start talks until 1999, and subsequent negotiations led to a non-binding declaration of conduct in 2002.

Chinese Foreign Minister Wang Yi said the agreement on the draft was a new and important step for the code of conduct deliberations.

“Ruling out external disturbances, the deliberation of the code of conduct will speed up and move forward,” Wang said.

He said the agreement on the draft showed that China and Asean had the capacity and wisdom to resolve disputes and “reach consensus on a set of regional rules”.

“It is like China and Asean countries building a house together,” Wang said. “In the past, there were 11 designs from the 11 countries on what this house would look like. Now we have laid good groundwork for a single design of this house.”

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Wang added that China and Asean would bolster that trust by holding their first maritime joint exercises in October.

Described by Singaporean Foreign Affairs Minister Vivian Balakrishnan as a milestone, the draft text will be reviewed in at meetings in Siem Reap in Cambodia, and Manila in the Philippines, in coming months, before it is formally endorsed by heads of state at the Asean summit in October.

But observers are sceptical about what real progress has been made.

“In substantive terms, this looks more like another Chinese ploy to put a veneer of breakthrough over snail-paced, open-ended negotiations,” Manila-based political analyst Richard Heydarian said.

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Xu Liping, a Southeast Asian affairs researcher at the Chinese Academy of Social Sciences, said China wanted to show that it could reach consensus with Asean.

“China and Asean are demonstrating their ability in finally coming with an agreement,” he said.

Additional reporting by Liu Zhen