Oliver Paterson is a third-year Economic History student at the London School of Economics. He is President of the LSESU Hayek Society and a Policy Fellow at the Pinsker Centre.

The race to salvage a crashed US F-35 fighter is just the latest example of a potential flashpoint in the South China Sea. China’s military expansionism within the region has been increasing tensions with other nations that have a vested interest in its future. Although China is not unique in the region for its territorial claims, it is unique in that under ‘wolf-warrior’ diplomacy China, has constructed extensive offensive military bases which it has used to threaten a war over resources.

China maintains its claims to the region are legitimate, arguing the construction of military infrastructure and land reclamation on islands permits the lawful expansion of Chinese territory, in open defiance of the Permanent Court of Arbitration’s rulings. The importance of this dispute is that one third of maritime trade passes through the Sea, estimated to be valued at $5.3 trillion, over three times the trade passing through the Suez Canal. Further concerns include arguments of equity; China is exploiting its position as the first developing nation in the region to lay claim to the region’s vast natural resources, which if distributed equally, could provide a lucrative development pathway for poorer nations.

There are several key areas in the region to which an increasingly assertive China possess a danger. These will be assessed in the course of this report on the South China Sea region.

Vietnam

Vietnam has a long history of disputes with China over territories in the South China Sea. As one of the first countries to begin land reclamation in the region, Vietnam is aware of the advantages of possessions in the South China Sea. The Islands developed by Vietnam as part of its regeneration programme continue to lead to frequent maritime disputes. In 2014, deadly anti-China riots broke out in several cities after China deployed an oil rig in Vietnams Exclusive Economic Zone (EEZ).

Commentators frequently disagree on the nature of the relationship between Vietnam and China. Some argue that the two nations appear to have compartmentalised their relationship; direct crisis lines have been formed to maintain contact in the case of any conflict that arises in the South China Sea. This however does not indicate that conflict has been meaningfully resolved, only that both sides are aware of the possibility of conflict and desire to prevent uncontrolled escalation. Moreover, Hanoi was the first government to prevent Chinese involvement in its 5G network, and anti-China sentiment appears to be growing as an increasing share of the population view US presence in Asia in a favourable light, with the figure currently standing at 52.6%.

With an increasingly aggressive China, Vietnam has taken various diplomatic measures. It has expanded its role within ASEAN and has increased arms imports from the US, Japan, and Russia. Unilaterally, Vietnam is developing a multi-pronged approach to dealing with China with the primary focus of maintaining peace and stability. Hanoi has been upgrading military and law enforcement capabilities, preparing for legal battles, and is successfully building relationships internationally with major powerbrokers.

Philippines

The Philippines has long been involved in island reclamation decades before Chinese involvement claimed territories within the region which has resulted in recent clashes with Chinese forces. By 2012, China had seized territory in Scarborough Shoal within the Philippines EEZ, and PLA patrol boats had prevented resupply missions by deploying water cannons. In March of last year, hundreds of Chinese ships entered into waters internationally recognised as Filipino.

The South China Sea is of vital importance to the Philippines; a large proportion of its fishing industry is based there, and with its main energy source dwindling, the vast gas reserves in its EEZ are critical to its energy sustainability. Significantly, the Philippines has a longstanding relationship with and reliance upon the US for national defence. Since 2016 President Duterte has followed a unilateral policy of negotiations with China; yet Filipinos continue to be harassed in formerly accessible territory. Filipinos, especially the Filipino political elite are increasingly concerned about Chinese influence in the region despite Duterte’s statements.

However, in recent months there is mention Duterte has aligned himself with the political elite in ending his understanding approach towards China, while members of his cabinet have clearly stated their views. For example, in 2021, after Chinese coast guards blocked resupply vessels to a Filipino occupied atoll, their foreign secretary stated firmly that “China has no law enforcement rights in and around these areas.”

Regardless of how sincere this approach is, the lack of political stability provided by Duterte internationally may be doing more harm than good for the regional security of the Philippines.

Malaysia

Malaysia has positioned itself with various stances across its recent history towards China, with some being highly confrontational, and others more muted, towards Chinese aggression. An important source of tension between Malaysia and China in the region is territory near the Natuna Islands as well as Luconia Shoals, an area wealthy in natural resources with an estimated 3 trillion cubic feet of recoverable gas. Malaysia’s state-owned energy firm Petronas has utilised the area for explorative drilling despite harassment from the PLA. Out of the nations in the region Malaysia is one of the most active in responding to Chinese incursions. In the summer of 2021, Malaysia scrambled fighter jets in response to an unplanned incursion of 16 Chinese military aircraft into its airspace, describing the incident as a “serious threat to national sovereignty”. These actions however have not prevented more recent incidents of Chinese aggression within Malaysian territory.

A significant issue for Malaysia, and one that is felt across the region, is the reliance upon China for economic, political and military purposes. Recently, Malaysia has been forced into defending itself from Chinese naval incursions using ships built in China; this gives rise to issues as weak points in both hardware and software can be exposed by the Chinese if conflict occurs. Malaysia also remains the top trading partner with China within ASEAN. Malaysia must begin to diversify away from its reliance upon China for military and economic security if it wishes to become little more than a satellite state for the CCP with which the wishes of Malaysians are strongly go against.

Taiwan

Although not geographically located within the South China Sea, Japan, South Korea, and Taiwan (Taiwan functions as the border between the South and East Seas) each have their own concerns over the area.

Taiwan was the first nation in the modern period to initiate a territorial dispute over islands in the South China Sea. These disputes initially took place with France in the early 20^th century. Following defeat in the Civil War, and the relocation of the ROC (Republic of China – colloquially referred to as Taiwan), the CCP adopted the same territorial claims of the ROC under the ‘nine-dash line’. A fundamental difference between the ROC and the PRC is the tendency to resort to military confrontation to assert its claims. The ROC remains committed to the freedom of navigation and overflight in the South China Sea,  much unlike the PRC which has sometimes utilised verbal threats to foreign powers when operating overflights.

The PRC continues to make rumblings about claiming Taiwan alongside the rest of its territorial claims. The ROC has attempted to make allies with nations throughout the South China Sea region, even those with which it has rival disputes such as Vietnam and the Philippines. The growing ties between Taiwan and opponents of the PRC where claims to the South China Sea are concerned, as well as Taiwan’s general focus on its own security against a growingly assertive PRC, should ensure that Taiwan will most likely deemphasise its disputes in the South China Sea with countries other than China.

Japan

Japan has over 81,000 square miles of disputed territory in the East China Sea with China spread across 8 disputed islands with an estimated 200 million reserve barrels of oil; a tempting prospect for an emboldened China. Japan also has further reason to be concerned. 80% of Japanese oil imports pass through the South China Sea and the Sea Lanes of Communication with are vital for telecoms networks run under the South China Sea; if China was to implement a stranglehold over the region these could be at threat.

Japan’s reaction so far has been to act within any international alliances of nations – given their pledge of using forces only in self-defence and on humanitarian issues following the Second World War. Most of these operations fall under ASEAN Plus Six, and the Quadrilateral Security Dialogue, which encompass the leading powers presenting an anti-China front of nations based within the region. Through these groups Japan has rejected China’s nine dash line claims and in recent years Japan has sold arms to nations across the region, such as Vietnam, to develop their forces as insurance.

South Korea

South Korea is primarily concerned about the South China Sea for its potential impact on trade; 86% of its oil imports and 30% of its overall trade passes through the Sea. South Korea has an often-strained relationship with China relating to trade, territorial disputes, and national security. As one of North Koreas only allies, China regularly enters disputes with South Korea. This was demonstrated in a trade war over garlic in 2000; South Korea placed tariffs on goods imported valued at $9 million, and in response China placed tariffs on $471 million of imports from South Korea. The impact of these trade disputes has been compounded by a growing share of trade with China; in 1992 China took just 3.5% of the ROKs exports versus 25% in 2017. The US took 32% of exports in 1992 compared to 12% in 2017.

Over national defence South Korea plays a balancing act; it relies heavily on US military support, but a greater US military presence is greeted by more Chinese aggression. This was demonstrated in 2016 when the deployment of an anti-missile battery resulted in harsh trade restrictions from China, and tourism plunging 62%.

As a result of this difficult balancing act, South Korea had often acted ambivalently towards key issues in the South China Sea. The ROK’s policy took on more definitive form, however, when in 2015 South Korean Defence Minister Han Him-Goo, unequivocally supported freedom of navigation in the South China Sea. Various governments of the ROK can be expected to sustain this firm stance against China’s claims to the South China Sea, especially as the South Korean public’s perception of China has hardened in recent years. Ultimately South Korea holds no direct territorial dispute in the South China Sea, but it remains dependent upon the waterways remaining free to continue its economic growth and as a counter to Chinese hegemony in the region.

Conclusions

The future of the South China Sea is highly uncertain; if nations continue in failing to defend their territory as recognised by UNCLOS, and as the world if focused on Ukraine, China may be emboldened to take further escalatory steps. Consequently, the alliance under ASEAN appears to be weak and divided as nations fail to agree on the appropriate line of policy. As independent countries balance the benefits of relations with the US against the consequences from China, if this relationship continues they are left in a difficult and dangerous position. The seriousness with which Japan is responding to issues in the region demonstrates that Western powers need to be concerned about the future of the region. In the same way the Cold War was fought heavily through proxy wars in Southeast Asia, we may once again be witnessing the beginning of conflict in the same theatre of war as international agreements such as UNCLOS appear weak in the face of China’s bellicosity.

Photo credit: Trey Ratcliff, Flickr, https://www.flickr.com/photos/95572727@N00/33773243578