South China Sea
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The American aircraft carriers USS Ronald Reagan and USS Nimitz with their carrier strike groups during a July 2020 drill in the South China Sea. Photo: EPA

Explainer | Why are tensions running high in the South China Sea dispute?

  • The strategic waterway is at the centre of long-simmering territorial disputes involving China, Vietnam, the Philippines, Taiwan, Malaysia and Brunei
  • The US has upped the stakes by accusing China of bullying, and both sides have stepped up military drills in the contested waters

This explainer was updated in August 2020 to reflect latest developments in the territorial dispute involving China and several Asean states, and the United States’ rejection of most of China’s claims in the strategic waterway.

The South China Sea, one of the world’s busiest waterways, is the site of long-simmering territorial disputes and increasingly frequent military drills by American and Chinese forces.

The overlapping claims of China, Vietnam, the Philippines, Taiwan, Malaysia and Brunei have remained unresolved for decades. Amid these conflicts, and as tensions between Beijing and Washington rumble on, the Trump administration upped the ante in July by issuing a direct challenge to China’s claims in resource-rich waters, calling them “completely unlawful”.

Conflicting claims in the South China Sea

The Association of Southeast Asian Nations (Asean) and several Southeast Asian nations have also used stronger language against China’s claims this year, and highlighted that the United Nations Convention for the Law of the Sea (Unclos) should be the basis for resolving the long-standing row.

What is the conflict about?

The Philippines, Vietnam, China, Brunei, Taiwan and Malaysia hold different, sometimes overlapping, territorial claims over land features in the sea, based on various historical and geographical accounts. The territorial dispute over the land features in turn has given rise to sharply different views among the countries about their maritime rights.

China claims more than 80 per cent of the waterway via its “nine-dash line”, which stretches as far as 2,000km from the mainland, reaching waters close to Indonesia and Malaysia.

Vietnam claims sovereignty over the Paracel Islands and the Spratly Islands, while the Philippines asserts ownership of the Spratly archipelago and the Scarborough Shoal. Brunei and Malaysia have claimed sovereignty over southern parts of the sea and some of Spratly Islands. Over the years, the claimants have seized control of a raft of sea features, including rocks, islands and low-tide elevations.

Indonesia is not a claimant state but maintains an exclusive economic zone in the Natuna Islands on the edge of the South China Sea, and has challenged China’s efforts to fish in the region. Earlier this year, Jakarta protested the presence of a Chinese coastguard vessel escorting Chinese fishing boats in the area, and deployed fighter jets and warships to patrol the islands.
Vietnamese sailors patrolling on Phan Vinh Island in the Spratly archipelago. Photo: AFP

Why is the South China Sea so important?

The South China Sea is a key commercial thoroughfare connecting Asia with Europe and Africa, and its seabed is rich with natural resources. One third of global shipping, or a total of US$3.37 trillion of international trade, passes through the sea.

About 80 per cent of China’s oil imports arrive via the Strait of Malacca and the South China Sea.

The sea is also believed to contain major reserves of natural resources, such as natural gas and oil. The US Energy Information Administration estimates the area contains at least 11 billion barrels of oil and 190 trillion cubic feet of natural gas. Other estimates are as high as 22 billion barrels of oil and 290 trillion cubic feet of gas.

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The South China Sea also accounts for 10 per cent of the world’s fishery stocks, making it a key source of food for hundreds of millions of people. To conserve stocks, Beijing in 1999 introduced an annual summer ban on fishing in the waters it claims, a “unilateral decision” disputed by Vietnam and the Philippines.
There have been multiple disputes and complaints over fishing boats from one claimant nation encroaching on waters in which another country claims sovereignty. Recent cases involve Vietnam and China, while Indonesia’s former fisheries minister made headlines for blowing up and sinking illegal fishing boats that had been seized by the authorities.


Washington’s hardened position on Beijing’s claims in South China Sea heightens US-China tensions

Washington’s hardened position on Beijing’s claims in South China Sea heightens US-China tensions

How has the situation evolved?

In 2014, the deployment of a Chinese drilling rig in waters near the Paracel Islands led to several confrontations between Vietnamese and Chinese ships and provoked protests in Vietnam.

That same year, Beijing began land reclamation operations in some of the features it controls in the Spratly archipelago, increasing surface area with man-made structures and in turn building military installations on them.

China has also established a new city on one of the islands – Sansha on Woody Island – in turn leading to an increase in Chinese tourism. Analysts note China’s success in changing the facts on the ground gradually, without triggering a major confrontation with other claimants or the US.

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In July 2016, a ruling by an international tribunal in The Hague determined China had no “historic rights” over the sea and ruled that some of the rocky outcrops claimed by several countries could not legally be used as the basis for territorial claims. Beijing rejected the ruling and described it as having “no binding force”.
Later that year, Philippine President Rodrigo Duterte said he would set aside the tribunal’s ruling. While his administration is seen by analysts as being mostly pro-China, incidents in the South China Sea have soured public opinion in the Southeast Asian nation towards Beijing, including the June 2019 sinking of a Philippine fishing boat after it was struck by a Chinese vessel.
Chinese tourists on Quanfu Island, one of the Paracel Islands, in 2014. Photo: AP
Officials from both sides have met to discuss joint oil exploration activities near the Reed Bank, most recently in January, while Philippine and Chinese diplomats last month called the disagreement a “ little pebble” on the road to closer economic cooperation. Duterte also recently barred the Philippine military from US-led military exercises in the South China Sea, in a bid to keep a lid on tensions in the region.
Tensions between China and Vietnam over their overlapping claims have risen this year. In April, a Chinese coastguard vessel collided with and sunk a Vietnamese fishing boat leading to an official protest from Hanoi.
Later that month, in a bid to underline its sovereignty there, China named 80 geographical features in the Paracel and Spratly Islands, which are also claimed by Vietnam. It also set up two new administrative districts on the islands, to be governed by the city Beijing had set up in Sansha. In response, Vietnam accused China of “seriously violating” its sovereignty.
In late July, Malaysia issued an unusually strident rebuke of China following Beijing’s assertion that Kuala Lumpur had no right to seek the establishment of its continental shelf in the northern part of the South China Sea. In a note verbale to the United Nations, Malaysia stressed that its application was fully within its rights under the 1982 UN Convention for the Law of the Sea (Unclos).
Chinese dredging vessels in the waters around Mischief Reef in the disputed Spratly Islands. Photo: Reuters

Where does Asean stand on the overlapping claims?

A draft code of conduct for the South China was put forward in August 2018, while China and Asean reached an agreement in November that year to finalise it within three years of 2019. Vietnam was expected to make some progress towards the code during its 12-month chairmanship of the regional bloc this year, only for the Covid-19 pandemic to scuttle that plan.

Analysts say Asean as a collective has tried to be nuanced and subtle in its approach to the South China Sea issue in order to balance regional interests with those of its member states.
However, the chairman’s statement issued following the June Asean summit headed by Vietnam saw the association use what was seen as tough language on the disputed waterway, including concerns on “land reclamations, recent developments, activities and serious incidents” that “may have eroded trust and confidence” and “may undermine peace, security and stability”.

In the statement, Asean also reaffirmed that the 1982 Unclos was the basis for determining maritime entitlements and sovereign rights over maritime zones, and was “the legal framework within which all activities in the oceans and seas must be carried out”.

The assertion is seen as one of their strongest remarks opposing China’s stance, and a reference to the 2016 ruling in The Hague, which was made under Unclos and invalidated most of Beijing’s claims in the South China Sea.


China ends fishing ban in South China Sea, raising fear of potential conflicts among fishermen

China ends fishing ban in South China Sea, raising fear of potential conflicts among fishermen

What role does the US play in the South China Sea?

The US has wide-ranging security commitments in East Asia, and is allied with several of the countries bordering the South China Sea, such as the Philippines, Singapore and Vietnam. Furthermore, the waterway is a vital trade route in the global supply chain, used by American companies who produce goods in the region.

The US has conducted regular Freedom of Navigation operations in the waters since 2015, designed to challenge what Washington considers excessive claims from Beijing and grant the free passage of commercial ships.

US patrols near disputed features claimed by China hit a record high in 2019, while it held 85 military exercises with regional allies in the Indo-Pacific last year. These included the first joint maritime exercises between the US and Asean, which were held in September 2019 and extended into the South China Sea.
In the latest salvo between the two superpowers – which have clashed heads over trade, Covid-19 and human rights – US Secretary of State Mike Pompeo in July issued a statement detailing Washington’s strident rejection of all Chinese claims beyond the 12-nautical-mile territorial area around the Spratly Islands.
Indonesia’s President Joko Widodo reaffirms his country's sovereignty during a visit to the Natuna Islands in January 2020. Photo: AP
July also saw Vietnam sign a memorandum of understanding with the US, which pledged support for Vietnamese fishermen against what the American ambassador called “illegal intimidation” in the waterway, without mentioning China. That same month, Chinese President Xi Jinping called Singapore’s Prime Minister Lee Hsien Loong and said Beijing would work with the island nation to safeguard regional stability – remarks seen as a “reminder” for it not to take sides.

Is there any resolution in sight?

According to analysts, Pompeo’s statement lays out a marker that Washington intends to align its foreign policy with the 2016 Hague ruling, similar to the stance taken by Asean – even though the US has never formally ratified Unclos. However, the bloc’s member states are seen as being likely to remain cautious and not publicly take Washington’s side, even after Pompeo’s broadside, as they need to maintain ties with Beijing to shore up their economic recovery from the Covid-19 pandemic.
Pompeo in August reached out to the foreign ministers of non-claimant states Indonesia and Singapore to reiterate American support for international law in the South China Sea, but the Southeast Asian nations steered clear of the US-China dispute.
Developments in the waterway are being keenly observed, with some critics warning that the South China Sea, rather than Taiwan, could be the spark for military action between the two superpowers.