Disruptive Swell on the South China Seas

Washington's definitive refusal to accept Chinese claims could heighten tensions between the two as well as embolden smaller stakeholder countries.

The U.S. Department of State, in the third week of July, in a definitive stance, refuted China’s claim over the South China Sea. It also declared its support for the countries in the region and vouched for ensuring freedom of navigation, which it deems as international waters.

Together with the recent closure of consulates by both countries, Washington's strong response came after a landmark US-Japan-Australia joint statement of July 7, condemning Chinese actions in the region, which was followed by comments by Japan, Australia and India along similar lines.

THE TURBULENT SEA

China’s claim rests on its historical assertion dating back to the ancient Xia and Han dynasties, even if modern international laws do not support them. South China Sea is a major sea line of communication (SLOC in military terms). Were China to gain control of it as its exclusive economic zone and continental shelf, it would have a death grip on the trade route that sees US$ 5.3 trillion worth of commerce sailing through it. Not to forget the economic value of resources preserved in its depth- natural gas reserves extending around 7,500 km³ (266 trillion cubic feet) and other minerals such as titaniferous magnetite, zircon, monazite, tin, gold, and chromite.

In 2012, Manila had taken its case to the Permanent Court of Arbitration in the Hague against Chinese unilateral action in seizing Scarborough Shoal after a brief military faceoff. Incidentally, at that point of time, the long term military ally of the Philippines, the U.S. remained a silent observer even though it has consistently maintained that the areas claimed by China are international seas.

In 2016, the court ruled that China's claim of sovereignty along the Nine-Dash Line had no legal basis in international law. Beijing rejected the ruling, saying the tribunal had no jurisdiction.

Other countries that dispute China’s claim to the South China Sea include Malaysia, Indonesia, and Vietnam, with claims of their own over parts of the region. The U.S. stand is that China “has no legal grounds to unilaterally impose its will on the region,” and that Beijing has “offered no coherent legal basis for its ‘Nine-Dash Line’ claim in the South China Sea since formally announcing it in 2009.”

Zhu Feng, the director of a South China Sea Studies Centre at Nanjing University, said in the Time that previous U.S. policy had been to try and solve disputes peacefully between China and its neighbours, through U.N.-backed methods. The new aggressive approach adopted by the U.S. is a major policy shift which could encourage other countries also to challenge China’s claims in a more aggressive way, thus risking a larger conflagration.

Ripples of the growing rivalry are being felt over the entire Indo-Pacific region. Last week saw a powerful U.S. carrier group under its flagship USS Nimitz conducting a cooperative exercise with Indian warships in the Indian Ocean. With Indian maritime air platforms going on operational readiness in the Andaman & Nicobar archipelago, which dominates the Malacca Straits, an Achilles heel of Chinese SLOCs, the growing tensions between India and China have transited from the lofty Himalayas to the wider Indian Ocean region.

SHIFTING U.S. STRATEGY

Despite a long history of disagreements on the Chinese claims over the South China Sea, the U.S. has never opposed China’s claim to the region so aggressively or so vehemently. The state department’s change in stance is further attenuated by the fact that sanctions have been imposed on the Communist Party over the imprisonment of Uyghurs. Beijing’s new security law for Hong Kong is opening a new clutch of bans in previously agreed treaties.

In the run-up to the November presidential elections, China is emerging as a hot topic for mustering nationalistic fervour by contending candidates. Mr Trump, who was engaged in a trade deal in January with China this year, accuses his Democrat opponent Joe Biden as being “soft” on China. On his part, Mr Biden has called President Xi a “thug” over the Uighurs “reconstruction camps. He has threatened to fly strategic B-1 bombers to defy China’s self-imposed no-fly zones over the South China Sea. As a counter to China’s new Hong Kong security law, he wants to “prohibit U.S. companies from abetting repression and supporting the Chinese Communist Party’s surveillance state”.

THE CHIPS WAR

The U.S. imposed export restrictions on Huawei, limiting its ability to use American technology to design and manufacture semiconductors. Currently, chip design and manufacturing equipment in the world's semiconductor plants are largely U.S.-made. As per the new rules, foreign semiconductor makers need to obtain a licence from the U.S. in order to ship to Huawei U.S.-designed semiconductors.This new rule has the potential to cripple Huawei’s global business interests resulting in its inability to fulfil obligations in already signed deals in different countries.

Taiwan, a U.S. ally, will also be impacted as its Taiwan Semiconductor Manufacturing Company (TSMC), is a major supplier to Huawei. In order to placate the U.S., TSMC later announced that it was going to construct a $12 billion foundry in Arizona to make some of its most advanced chips.

Chinese response has been along expected lines. "It seems the U.S. is ratcheting up efforts to pinch China's high-tech companies," the Global Times editorial read, "U.S. suppression has become the No. 1 challenge to China's development".

Moreover, China is now investing in its own chip foundries, which could put it on the path to become one of the world leaders in semiconductor technology. The China Integrated Circuit Industry Investment Fund, or 'Big Fund', raised US$ 51 billion — $22 billion in 2014 and another $29 billion in 2019 — and has used the capital to start over 70 projects in the semiconductor industry. It now makes 16% of the world’s chips, though their quality remains poor.

DEVELOPMENTS WITHIN QUAD

The U.S. statement has seen support from countries like Australia, (“will continue to support freedom of navigation in the SCS”}{, and India (“the SCS was part of global commons and India has an abiding interest in peace and stability in the region”}. China has naturally accused the U.S. of “interfering in the region’s issues and unnecessarily escalating the situation and sowing discord between China and the Southeast Asian countries”.

It is worth noting that the U.S. claim to stand with the other Southeast Asian countries on this issue, with assurances of U.S. military protection, could lead to Southeast Asian claimants, like Vietnam and the Philippines, to advocate for themselves more forcefully. There is the also the question of whether the U.S.’s priority of “freedom of navigation” translates to “freedom of the seas”, which includes focusing on the neighbouring countries’ economic rights as guaranteed by international law.Will the U.S. also safeguard the economic rights of individual countries over their claimed areas of the South China Sea?

ASSESSMENTS

  • The recent aggressive U.S. response could have been prompted by two reasons: a way of President Trump trying to milk the anti-China sentiment in his favour for the upcoming elections, or due to the heightening trade war and restrictions placed on semiconductor technology going to Taiwan Semiconductor Manufacturing Company (TSMC), to subdue Huawei.
  • Concurrent to its diplomatic and economic measures, the U.S. is going ahead with a show of brute military force which China is unable to match, at least not at this stage of its military development, to further drive home its point of view. Countries like India, facing uncalled for military pressure on its land frontiers, would welcome the presence of “friendly” forces on China’s vulnerable flanks.

Author: Synergia Foundation Research Team

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