EUROPE ASIA FOUNDATION - Insight
Sailing in the South China Sea
You would not want to go to the Spratly Islands even for the most isolated ‘get away from it all’ holiday. On the other hand, you might want to go there if you were bent on regional geopolitical domination.
Ten Asian countries, including eight of the ten members of ASEAN, claim sovereignty over some or all of the ocean around the islands and those eight live in relative harmony together. The other two are the more distant Taiwan, which claims just 3 of over 100 entities which make up the archipelago, including the largest, Taipei Island; and China, which makes claim to every single one of the Spratly Islands and more besides. Taiwan’s claim is disputed though it has had possession of Taipei Island since 1946. Taipei Island has not been given the international status of ‘island’; its airport runway runs the whole length of the rock.
When British whaler Richard Spratly named the islands in 1853 he could not have known what a can of worms he was creating. Most of the natural structures there are not islands made of rock but corals, reefs and sandbanks. Few have access to fresh water, most are hostile and uninhabited. The 45 natural structures we might recognise as ‘land’ together make up barely two square kilometres in total. Where human settlements do exist, they are almost exclusively of a military nature, from any of five different countries. The islands are situated almost exactly in the centre of the South China Sea, equidistant from their nearest neighbours Vietnam, Philippines and Malaysia. Together they sit in a fertile but over-exploited fishing zone and an Aladdin’s Cave of unexploited oil and gas fields, occupying a highly significant strategic military position. They are in some of the world’s busiest shipping lanes, routes which carry 40 percent of the world’s liquefied natural gas and $3.37 trillion-worth of trade each year.
What all the Spratly Islands (and others) have in common is their position inside China’s ‘nine-dash line’, a claim to oceanic sovereignty which covers most of the South China Sea and rides roughshod over the rights of other nations. This is in breach of the United Nations Convention on the Law of the Sea (UNCLOS), which allows countries to exploit the ocean, and its bed, in Exclusive Economic Zones (EEZ) only up to 200 miles from their shores. Since 2013 the amount of land available for military occupation in the Spratly Islands has increased considerably, as China has both reclaimed land from the sea and used sand to build extensions to islands in order to facilitate its dominance. ‘Nine-dash’ refers to the original way the line was drawn on a map; it is not tightly defined geographically and has no internationally recognised legal status.
In 2016 the UN ruled that China was in breach of UNCLOS and since then what has happened is… nothing. The UNCLOS convention was agreed in 1982, with China one of the founding signatories, and ratified in 1994 but the Chinese refuse to recognise the 2016 decision. At the same time the Philippines, the country which brought the case and won it on every count, has not pressed for the tribunal decision to be implemented. In that same year, 2016, the Philippines elected Rodrigo Duerte as their President. Throughout his Presidency Duerte has been actively courting Chinese aid, investment and friendship, so it is perhaps no surprise that the ruling continues to go unenforced.
Only once in recent years has an ASEAN country dared to carry out geological exploratory work, with a view to oil and gas extraction, within their own legal waters but also within the nine-dash line (and a very long way from China). This was a Russian company, acting at the behest of Indonesia, comfortably inside the border of their own EEZ but on the ‘wrong’ side of the Chinese line. Since 2019 China has blatantly carried out three similar substantial surveys of its own within the EEZs of Malaysia and Vietnam, who have proved powerless to prevent them. In one instance Chinese forces were harassing an established Malaysian offshore drilling operation but when the US offered diplomatic, and perhaps other, support to the Malays it was politely declined. The US has a defence treaty with the Philippines which could potentially draw it into conflict should the Philippines wish to interpret China’s actions as a threat to its gas fields, though no challenge appears likely to come from that source. The US Navy maintains a constant presence in the South China Sea, as do ships from Japan, UK and Australia, but China remains undeterred and is building up its naval presence there.
The nine-dash line has been in existence since 1947. In all that time China’s assumed right to overrule the sovereignty of its neighbours at sea has never been seriously challenged and the Spratly Islands, in particular, have become a new, offshore line of China’s military defences. Why has this grown in importance of late, and could the problem take on global proportions in the future?
As the world moves away from coal and oil to drive its economy, two alternative industries have boomed. One is the sustainable, long-term driver that is renewable energy, but the other is gas. Natural gas is, of course, a carbon source but it is not as intensive in its CO2 emissions as coal and, probably for a generation at least, it is likely to play a major and increasing role in the production of electricity in countries across the globe. It is this rising demand, exaggerated by the projected diminution of oil production, which is driving the massive gas price rises the world has seen over recent months.
Forget the fact that one in eight of the world’s fish is caught in the South China Sea by a $100 billion industry; stocks are plummeting due to the effects of climate change and over-fishing (much of it illegally by Chinese vessels). Fish will reduce in regional economic importance; gas is the main game in town.
We have seen that the South China Sea, constrained by the landmass of ten surrounding nations, is not only one of the world’s major transport routes for liquified natural gas but potentially a massive and untapped source of new supply. This future role explains China’s activity in geological surveying of the ocean bed. More immediately, whoever controls those routes controls both the supply and the price of gas for the whole planet. If, in practice, the world’s gas supply increases its dependency upon Chinese gas fields, irrespective of the legal stewardship of the ocean beds, travelling through shipping lanes policed by the Chinese military, based on dozens of sites in the Spratly archipelago, then Beijing’s hold on the global economy, environment and trade will be ratcheted up by more than a notch.