Tuesday, February 05, 2008

Roiling the waters in the Spratlys

04 February 2008

Brian McCartan

Chen Shui-bian, on his last legs as Taiwan’s president, barnstorms the South China Sea’s disputed islands

Taiwanese President Chen Shui-bian's weekend visit to Taiping Island in the Spratlys has once again heightened tensions in the South China Sea, only a week after China and Vietnam agreed to resolve their disputes over the area diplomatically.

Chen's Taiping visit, aboard a Taiwan Air Force C130 Hercules that landed on a 1,150-meter runway on an island that is also claimed by the Philippines and Vietnam, is the latest in a series of disputes that have increased tensions in the region over the Spratlys, a flock of islets in the South China Sea that are claimed in part or entirely by every country surrounding the South China Sea -- China, Taiwan and Vietnam (all), the Philippines, Malaysia and Brunei (partly). All but Brunei have troops stationed on the islands.

Chen’s landing, which involved the inspection of troops and the opening of a new runway, has been labeled by political analysts and the Taiwanese media as an electioneering stunt to increase the chances of presidential candidate Frank Hsieh of Chen's independence-leaning Democratic Progressive Party (DPP) ahead of March 22nd elections. Chen is to step down in May after eight years as president.

But vote-getting trip or not, it has particularly served to anger China and has resulted in protests by Vietnam and the Philippines. The Philippines expressed "serious concern" that the trip may affect peace in the area. Philippine Foreign Secretary Alberto Romulo said, "The Philippines, therefore, urges all parties to exercise prudence, self restraint and use diplomacy as the tool to settle disputes."

Despite the fact that the islands are nothing more than specks that are incapable of supporting life on any scale, control over the sea lanes that run past them is crucial, not just to the six claimants but to Northeast Asian nations and the United States as well. Perceived large oil and gas deposits in the area and rich fishing grounds have made this string of otherwise small islets, reefs and rocky outcroppings very valuable to the nations involved.

Fully a fourth of the world's crude oil and oil products flow through what amounts to the globe’s second busiest sea lane, as well as gas, coal and iron ore. Control is important to Washington's Northeast Asian allies, South Korea and Japan because it links them to oil from the Persian Gulf and thus threatens their energy security.

Chen’s mischief-making aside, the pressure ratcheted up last March when Vietnam announced a deal between PetroVietnam, British Petroleum (BP) of the UK and ConocoPhillips of the US to jointly explore for gas near the Spratlys. China protested the US$2 billion natural gas field and pipeline project, claiming it infringed on Chinese sovereignty and administrative hegemony over the islands. Vietnamese Foreign Ministry spokesman Le Dung responded with a statement that the exploration was within the boundaries of Vietnam's exclusive zones and continental shelf. However, in June, BP, PetroVietnam and ConocoPhillips announced a halt in the project.

During the same month, China arrested 41 Vietnamese fishermen near the Spratlys for straying into contested waters. They were released after paying fines. Vietnamese fishermen in another incident on July 9th were not as lucky. One fisherman was killed and several others were injured when Chinese navy vessels opened fire on their fishing boats near the islands. Two Vietnamese fast attack boats rushed to the scene but kept their distance from the more powerful Chinese vessels.

The use of force was unusual since in recent years Vietnamese vessels have usually been only detained for straying into contested waters. Official Chinese media were initially quiet about the clash, possibly out of a desire to keep the clash from escalating.

Military squabbles over sovereignty are not new, however, and have been going on for decades. China seized the Paracel Island group to the north of the Spratlys from what was once the South Vietnamese government in 1974 after a brief battle. Although North Vietnam at the time issued statements supporting the move, the reunified Vietnamese government renewed its claim to the islands and still views them as Vietnamese territory. In another naval battle between China and Vietnam in 1988 near Johnson Reef in the Spratlys more than 70 Vietnamese sailors were killed and two vessels were sunk. Between 1988 and 2002 several confrontations between naval vessels, sometimes violent, were almost a yearly occurrence and seizures of fishing boats and cargo vessels were common.

Indeed it was the military that heightened tensions again in November when large military exercises by China in the South China Sea close to the Paracels sparked protest from Vietnam. Beijing claimed that the exercises were normal because they were within its territorial waters. The Vietnamese, however, felt the issue was important enough to be raised by Vietnamese Prime Minister Nguyen Tan Dung on the sidelines of the November 2007 Asean Summit in Singapore with Chinese Premier Wen Jiabao.

Dung called for the two countries to continue exchanging opinions in order to find suitable areas and means of cooperation over their disputed and overlapping territories in accordance with international law to find solutions that are amenable to both parties. Wen said he hoped the issue could be resolved by putting maritime boundary claims aside and using a joint approach to exploit the resources of the area.

Despite these conciliatory statements, tensions increased yet again on December 4 when Vietnamese state media criticized China for ratifying in the People's Congress a plan to create the Sansha administrative zone to manage the Paracels, Spratlys and the Macclesfield Banks. The zone has been given the status of a "county-level city" within Hainan Province with its administrative headquarters on Woody Island in the Paracels.

Vietnamese Foreign Ministry spokesman Le Dung said, "This act violates Vietnam's sovereignty and is detrimental to the process of negotiations to find durable solutions to solve the maritime issues between the two countries." In reply, Chinese Foreign Ministry spokesman Qin Gang claimed China has "indisputable sovereignty" over the islands.

Anger over China's decision had an unusual outlet in a rare public demonstration outside the Chinese embassy in Hanoi on December 9th by several hundred Vietnamese. Another demonstration was held outside the Chinese consulate in Ho Chi Minh City. Government spokesman Le Dung announced that the demonstrations were spontaneous and not government orchestrated, but some observers were skeptical.

They noted that protestors had placards with slogans and T-shirts emblazoned with maps of the Spratlys already made up. In addition the demonstrations were allowed to form and continue for over an hour before being quietly dispersed. Cyberspace filled up with Chinese and Vietnamese bloggers airing nationalistic views and slamming each other over conspiracies to steal energy.

The air seemed to clear during the second China-Vietnam Steering Committee on Cooperation meeting on January 22-26 in Beijing. Chinese Foreign Ministry spokeswoman Jiang Yu said on January 24 that both countries "agreed to solve disputes through negotiations and safeguard peace and stability in the South China Sea," although this does seem at odds with Jiang’s statement of China's "indisputable sovereignty over the South China Sea Islands and the adjoining waters."

This seems to put China back on track with its previous attempts to downplay its claims to the islands in preference to building up ties between itself and Asean nations, often stressing the need to jointly exploit the resources in the area.

The perceived large undersea oil and gas deposits are a major issue for Vietnam and China, both of which need the energy to support rapidly growing economies with resultant rapidly escalating domestic energy needs. The size of the deposits has not been verified but the US Department of Energy estimates that 183,000 barrels per day of oil and gas are available from the fields around the Spratlys. China claims there are 225 billion barrels of hydrocarbons in the area, of which 70 percent is natural gas.

The complaint over the PetroVietnam-BP-ConocoPhillips project was not the only one China made in 2007. On November 22nd, Beijing made a diplomatic protest to India over state-controlled ONGC Videsh Ltd.'s exploration operations near the Spratlys. ONGC Videsh signed product-sharing contracts with Vietnam for 80 percent of its concession area in 2006 and has invested US$100 million in the project to date. China claims Vietnam's award of the concession is invalid. China has also put pressure on oil companies operating in China to stop surveying and drilling operations under concessions from the Vietnamese government.

China also views control over the Spratlys as a way of projecting its power and influence into the area. In the US Defense Department's report to Congress, Military Power of the People's Republic of China 2007, it noted that the Spratlys and Paracels are envisioned as part of China's defense plan to keep hostile naval forces away from the coast. A runway on Woody Island in the Paracels was extended in the 1990s to 2,600 meters. In addition gun emplacements, a signals intelligence station and Silkworm anti-ship cruise missile installations have all been reported in the Paracels. The possibility of this sort of militarization by China in the Spratlys is of real concern to regional military security planners and in Washington due to the ability of China to then command the sea lanes.

China has shown a willingness to use its naval forces to pursue national security interests according to military analysts, especially when it involves sovereignty and territorial issues. The Chinese navy has increasing focused on a goal of attaining the means to project power across its sea lines of communication and to protect its oceanic commerce. In a talk given at the US-based Asia Society on January 28th, Admiral Timothy Keating, head of US armed forces in the Asia-Pacific said the US has "intelligence that reinforces my opinion that China is developing, fielding and has in place weapons that could be characterized as having, amongst perhaps other purposes, an ability to restrict movement in and around certain areas on the sea, in the air or under the sea."

China's move to occupy Mischief Reef in 1998 and 1999 while the Asean nations were preoccupied with the 1997 financial crisis gave some credence to this fear. The reef is well within the eastern part of the Spratlys, which was seen as the Philippines zone of control. While China claims there are only shelters for fishermen on the island, the reality are permanent concrete structures with antiaircraft guns and landing platforms for helicopters.

For the Asean nations, some fear of China's intentions were assuaged in November 2002 when Asean and China signed the Declaration of the Conduct of Parties in the South China Sea to resolve disputes in the region peacefully through diplomatic means. The Declaration, while displaying good intent, is non-binding and this fragile. As the events of 2007 between Vietnam and China show, there is still much maneuvering for advantage going on in the area.

The agreement relies largely on the signatories allowing regional concerns to take precedence over their own national interests, something which to date they have largely shown a disinclination to do. The ten points in the agreement remain inadequately defined and rely largely on bilateral discussions to settle disputes.

One outcome of the declaration has been the establishment of a joint seismic exploration program through the national oil companies of China, Vietnam and the Philippines - China National Offshore Oil Corporation, PetroVietnam and the Philippine National Oil Company - in one area of the eastern Spratlys.

Other plans, such as the proposed Pan-Tonkin Gulf Regional Economic Cooperation scheme, are in the works. An offshoot of the Asean-China Free Trade Agreement signed in 2004, the idea was floated in 2006 and has reportedly received the support of high level Chinese leadership. Pushed by the Guangxi Autonomous region in Southeastern China, the scheme would like to see greater integration between the economies China and the ASEAN nations bordering the South China Sea, and the Gulf of Tonkin in particular. The stumbling block is the territorial disputes over the Spratlys which would have to be solved before the plan could effectively go ahead.

Taiwan, however, is not a signatory to the 2002 Asean-China declaration. The February 2 visit by Chen, the first by a Taiwanese leader, can only be seen as a move to underscore Taiwan's claim to the Spratlys. The recently-completed airstrip had already been the subject of protests by Vietnam and the Philippines. The Taiwanese Ministry of Defense claims the runway is only for maritime search and rescue. Observers say the airstrip is a way for Taiwan to show it is a member of the international community as well as a way to stamp a further claim on the islands.

Vietnam first protested the construction of the runway which was begun in mid-2006. After a test flight to the newly completed airstrip in January and plans leaked about the possible presidential visit, representatives from Vietnam and the Philippines in Taipei expressed concerns to the Taiwanese government on January 30th.

Vietnam's Foreign Ministry spokesman Le Dung had much stronger words: "Taiwan has to take full responsibility for any consequence by this action. Vietnam considers the action a serious escalation that violated Vietnam's territorial sovereignty in regard to the Truong Sa [Spratly] archipelago and increased tension as well as complication in the region. Vietnam demands Taiwan put an immediate end to such violations in the region."

In a presidential statement Chen called for a "Spratlys Initiative" to find a peaceful solution to disputed claims and promote marine conservation. Chen was quoted in the statement as saying, "Facing complicated and sensitive territorial and sovereignty disputes in the South China Sea, Taiwan urges the countries involved to peacefully resolve the issues." His visit, however, has only caused the opposite and served to further heighten tensions in the region.