The Impeccable Affair and Renewed Rivalry in the South China Sea

Developments in the South China Sea during the first quarter of 2009 reinforced several trends that have been apparent over the past two years. First, the Spratly Islands dispute has once again come to dominate Sino-Philippine relations, despite attempts by Beijing and Manila to move beyond it. Second, China has adopted a more assertive posture toward its territorial and maritime boundary claims in the South China Sea than at any time since the late 1990s. Third, the 2002 breakthrough agreement between the 10 members of the Association of Southeast Asian Nations (ASEAN) and China to manage tensions in the South China Sea is in danger of becoming irrelevant. Fourth, the USNS Impeccable incident on March 8 highlighted the growing strategic importance of the South China Sea for the United States and China, and reawakened concerns in ASEAN capitals that the region may one day become the principal theater wherein Sino-U.S. maritime rivalry is played out.
Several possible explanations account for China’s more assertive behavior. The main target of Chinese activities is Vietnam, and it is possible that Beijing may be attempting to pressure Hanoi into accepting a joint exploration and production agreement in energy fields off the Vietnamese coast similar to the 2008 pact between China and Japan to develop the Chunxiao gas field in the East China Sea. As a pressure tactic, Beijing has leaned on foreign oil companies not to enter into deals with Vietnam, the implicit threat being that those corporations that do will be barred from future energy projects in China. Thus far this tactic has proved ineffective, as the oil companies in question have indicated their resolve to follow through with existing deals. China may also be sending a signal to Vietnam that it strongly disapproves of growing U.S.-Vietnam defense ties.

Another likely reason is China’s continued demand for energy resources despite falling oil prices caused by the global financial crisis. Indeed in its 2008 Defense White Paper the PRC averred that “struggles for strategic resources” were intensifying (Xinhua News Agency, January 20, 2009). A third reason is that after two decades of military modernization the People’s Liberation Army (PLA) is now in a better position to project power in support of China’s maritime territorial claims. These capabilities include a new generation of surface warships, submarines, and fighter aircraft with extended operational ranges. As the Pentagon’s recent annual report on the PLA noted, these capabilities “increase Beijing’s options for military coercion to press diplomatic advantage, advance interests, and resolve disputes in its favor” (Annual Report to Congress on the Military Power of the PRC, p. 28).

Japan Focus