Risk of US-China showdown hangs over South China Sea

Risk of US-China showdown hangs over South China Sea

While the world is preoccupied with the rising North Korean nuclear threat, the shadow of a more traditional big-power conflict between the United States and China hangs over the region.

Aggressive claims from China

The South China Sea is home to several islands and reefs, and a major sea lane for international trade. China, Vietnam, Taiwan, the Philippines, Brunei and Malaysia have competing territorial, fishing and oil drilling claims that have been managed through an uneasy status quo provided by the U.S. naval power and international law.

Over the past few years, China has been aggressively asserting its territorial claims in the South China Sea, upsetting relations with Vietnam, the Philippines, Taiwan, Brunei and Malaysia. According to international law, each country’s territorial waters extend 12 nautical miles off a nation’s coastline, while their “exclusive economic zone” (EEZ) extends 200 nautical miles. Per the law, the middle of the South China sea is open for all nations to navigate.

China ignores the 200-mile norm and extended its maritime claims to include nearly the entire South China Sea. Doing so expands China’s access to oil and fishing rights, while denying these same rights to the rest of the nations. Furthermore, the Chinese government demanded that any airplane or ship entering this expanded area shall declare itself to Chinese authorities.

The Philippines filed an arbitration case against China at the Permanent Court of Arbitration at the Hague contesting China’s expanded sea claims. In 2016, the tribunal ruled in the Philippines’ favor, saying China had no “historical right” to the territory. However, China flouted the tribunal’s decision, saying it had no jurisdiction.

Military bases and reclamation projects

China initiated vast reclamation projects on several rock formations. These unilateral efforts are dangerous for two reasons. First, the rock formations are disputed, as Vietnam, the Philippines, Taiwan, and Malaysia also claim these formations.  Second, international law bestows limited territorial rights to the nation that owns a rock formation, such as the 12 nautical mile territorial extension.

International law does not grant the 200-mile “exclusive economic zone” privilege to owners of such rock formations. But owners of formal islands are granted this EEZ privilege. Therefore, China’s reclamation projects to turn these barren rock formations into islands would increase China’s legal rights if they were internationally recognized.

China is taking this one step further by building military bases that include surface to air missiles, ports, and runways, allowing China to project military power across the sea. The reclamation projects, military bases and disregard of the status quo alarm China’s neighbors and the U.S. because they pose a direct challenge to U.S. economic and regional geopolitical interests.

The case for an end to US neutrality

Tremendous power and influence would redound to the country that controls this important conduit. As a result, U.S. Navy patrols keep these sea lanes open to all.

China’s control of the sea would alter the balance of power by threatening U.S. military pre-eminence in the region, allowing it to more easily intimidate its neighbors through economic coercion. U.S. access to markets and natural resources could be jeopardized since American influence and alliances would weaken.

Historically, the U.S. has remained neutral regarding the competing claims from other nations, but if China persists, the U.S. will find itself in a position where clarity is needed around its support for other nations’ claims against China.

The U.S. could negotiate with regional players such as Vietnam, Taiwan or the Philipines to build additional U.S. military bases to help further deter Chinese aggression. In addition, the U.S. could pursue additional arms sales, enhance its military agreements and begin joint military exercises with its regional partners.

Non-military option more likely

There are potential non-military actions the U.S. can pursue. For example, the U.S. can counter China’s economic influence by restarting economic trade talks with the affected nations. The Trump administration looks askance at international trade pacts, but could re-engage if the U.S. wants to win over more allies in its mission to thwart China’s growing regional influence.

There is a good chance that China would not retaliate in response to these possible U.S. actions, because China’s South China Sea claims are neither an existential threat to its security, nor related to its claims on Taiwan.

In the end, China’s commercial interests outweigh its desire to dominate the South China Sea, and direct hostilities with the U.S. could threaten the stability of its commercial interests. It was the Obama administration’s passivity in the face of escalating Chinese actions that invited further encroachment, as China willingly moved into the created vacuum. Thus, modest U.S. assertiveness is unlikely to trigger a war.


About Author

Adam Goldin

Adam Goldin is a Philadelphia-based economist with master’s degrees in both economics and international affairs. His areas of expertise include country risk, international and financial economics, government and politics, and foreign policy.