Chapter 7: Recent developments and regional cooperation in the South China Sea – Solving Disputes for Regional Cooperation and Development in the South China Sea


Recent developments and regional cooperation in the South China Sea


This chapter focuses on developments in the South China Sea in the past five years and the prospects of cooperation in the region by examining some critical events: the submission of outer limits of extended continental shelf to the CLCS, national legislation by the respective claimant states, maritime incidents and the spat between the United States and China on freedom of navigation, the implementation of the DOC and prospects of a code of conduct, the involvement of non-claimant states and its implications, and, last but not least, the UNCLOS Annex VII Philippines versus China arbitration. The chapter also proposes a guideline for cooperation among claimant states and specifies areas of cooperation.

Key words

recent developments

regional cooperation

South China Sea

Recent developments in the South China Sea

The South China Sea has long been considered as one of the flashpoints in the Asia-Pacific region (Wu and Zou,2009: 3). In retrospect, there was a precious peaceful time in the region from 2002 to 2009, mainly due to the political framework provided by the Declaration on the Conduct of Parties in the South China Sea between China and ASEAN (Hong, 2012: 30). Despite a soft law nature that makes it a non-effective regime in terms of dispute settlement, the DOC is indeed an important step forward in confidence building critical to future cooperation.

Four key players in the recurring dispute since 2009 are China, the Philippines, Vietnam and the United States. Instead of describing five years’ worth of events, the author singles out five key issues: maritime delimitation, national legislation, maritime incidents, dispute settlement and non-claimant states’ involvement.

CLCS submission

Information submitted by states to the Commission on the Limits of the Continental Shelf, according to Article 76 of UNCLOS, is rightly seen as a trigger to the deterioration in the situation since 2009 (ibid.: 31). On 6 May Malaysia and Vietnam made a joint submission concerning the outer limits of the continental shelf beyond 200 nm (Malaysia/Vietnam, 2009); on 7 May Vietnam made a national submission on its outer limits of the continental shelf beyond 200 nm from the Vietnamese baselines (Vietnam, 2009). China objected to the two submissions, holding that they had infringed its sovereignty, sovereign rights and jurisdiction in the South China Sea (China, 2009). The map enclosed in China’s objection letter was intensively and critically discussed afterwards, with a focus on China’s claim and its legality from the U-shaped line. The discussion was reviewed in Chapter 3 and will not be repeated here.

Article 5 of the DOC provides:

The Parties undertake to exercise self-restraint in the conduct of activities that would complicate or escalate disputes and affect peace and stability including, among others, refraining from action of inhabiting on the presently uninhabited islands, reefs, shoals, cays, and other features and to handle their differences in a constructive manner. (DOC, 2002)

Contrary to the spirit of Article 5, these two submissions to the CLCS reignited the tension and can hardly be argued as an act of self-restraint to maintain the peace and good order of the region. On 7 May China urged the CLCS not to review the joint submission by Malaysia and Vietnam (China, 2009). Some observers commented that this submission could be seen as just a ‘political gesture’ that only served to complicate and escalate the situation, in view of the known fact that the CLCS will not make recommendations on submissions relating to an area subject to a sovereignty dispute (Bateman, 2010: 2).

As discussed in Chapter 3, the island regime lies at the heart of the SCS dispute. Neither the disputed sovereignty over the islands nor the maritime jurisdiction and delimitation can be resolved without an authoritative explanation of UNCLOS Article 121(3) regarding the definition of ‘island’ and ‘rock’. However, the submissions on the outer limit of the continental shelf are based on the assumption that none of the Nansha features could be entitled to an EEZ or continental shelf. But if any of these islands is proven to be capable of generating an EEZ and continental shelf in the future, no area of potential outer continental shelf beyond 200 nm will be left.

National legislation and regulation

Some claimant states incorporated their claims into national legislation. On 17 February 2009 the Philippine Congress passed Republic Act No. 9522, incorporating Huangyan Island and several of the Nansha Islands for the first time, in order to consolidate its claims on those features. On 10 March 2009 the act, otherwise known as the Philippine Archipelagic Baselines Law, was signed into law by then Philippine President Arroyo (Congress of the Philippines, 2009). Furthermore, on 5 September 2012 Philippine President Benigno S. Aquino III signed Administrative Order No. 29, officially naming portions of the South China Sea west of the Philippine archipelagos as the West Philippine Sea, and instructed the national mapping authority to produce and publish a new official map in a bid to support the Philippine claim to certain islands and reefs and their adjacent waters in the SCS (Republic of the Philippines, 2012).

Vietnam also enshrined its claims in national legislation. On 21 June 2012 the president officially announced the approval of the Law of the Sea of Vietnam, amid escalating tension in the region. The law explicitly refers to the Xisha and Nansha Islands, and entered into force from January 2013 (Vietnam, 2012).1

In reaction to Vietnam’s move of enacting domestic laws, on the same day China’s Ministry of Civil Affairs announced the State Council’s approval of the establishment of Sansha City on Yongxing Island (Woody Island). It must be clarified here that Sansha is to exercise jurisdiction over the Xisha, Zhongsha and Nansha Islands and their adjacent waters, not all waters within the U-shaped line (Ministry of Foreign Affairs, 2012b).

On 25 June 2012 CNOOC of China announced it would put up nine offshore blocks in the SCS for bidding, including areas that overlap with blocks Vietnam has already started jointly exploring and developing with India (Globaltimes, 2012). Vietnam protested China’s act as a violation of Vietnam’s sovereignty (Wall Street Journal, 2012). China responded to Vietnam’s protest by pointing out that the announcement is in line with China’s domestic law and international practices. Based on the consensus of the two countries regarding settlement of maritime disputes, Vietnam’s ongoing oil exploration project is an infringement of China’s right and interests and should be discontinued (Ministry of Foreign Affairs, 2012c).

On 27 November 2012 a newly revised Regulation for the Management of Coastal Border Security and Public Order in Hainan Province was passed by the Standing Committee of Hainan’s Provincial People’s Congress, defining activities that violate security management in waters under the jurisdiction of China’s Hainan province concerning foreign ships and personnel (Valencia, 2013). The Philippines protested against the revised regulation, and accused China of escalating tensions in the SCS. In response, China’s Foreign Ministry spokesperson said that China carries out maritime management according to international and domestic laws. The navigational freedom countries enjoy in the SCS according to international law should be protected, and China attaches great importance to maintaining such freedom (Ministry of Foreign Affairs, 2012d). As already observed, the new regulation is to implement UNCLOS Articles 19 and 21, with the aim of clarifying the passage regime and right of innocent passage of foreign ships within China’s territorial sea. It is a modified version of a 1999 regulation without expanding the enforcement powers of local authorities (Valencia, 2013). Furthermore, the revised regulation does not represent a tougher stance in China’s SCS policy; it is simply a response to an increase in Vietnamese fishing activity near the Xisha Islands,2 and will only be applied to the territorial sea 12 nm from baselines that have already been officially published (Fravel, 2013).

Incidents at sea

Maritime security is of crucial importance to the SCS, especially in a period of escalating tension. On 26 May 2011 Vietnam conducted unilateral offshore oil and gas exploration in the disputed Nansha Islands and three Chinese marine patrol vessels arrived on the scene, cutting the cables of a Vietnamese oil survey ship (Reuters, 2011). The incident led to escalated diplomatic tensions between China and Vietnam and widespread attention to the South China Sea. On 9 June Chinese fishing boats, working in waters where they had operated for generations, were chased away by Vietnamese armed ships and the fishing net of one Chinese boat became tangled with the cables of a Vietnamese oil- exploring vessel, which was operating illegally in the area. China accused Vietnam of endangering the lives of the Chinese fishermen by dragging the Chinese boat for more than an hour; while Vietnam protested that a Chinese fishing boat ‘intentionally’ cut the cables of a Vietnamese oil survey ship (BBC, 2011).

On 10 April 2012 a Philippine warship entered waters off Huangyan Island in the SCS and its soldiers boarded and searched Chinese fishing boats seeking shelter from bad weather in the lagoon. Two Chinese marine surveillance ships near the area rushed to the scene to protect the Chinese fishermen from being harassed. The two sides were then engaged in the extensively reported ‘Huangyan Island standoff’ (Wu, 2012). The follow-up to the standoff is the Philippines versus China arbitration, studied below.

It is worth mentioning that maritime incidents occurred not just between claimant states but also with nations outside the region, in particular the United States. Although nothing so serious as the 2001 EP-3 case that entailed the death of a pilot has happened so far, the conflicting interests of coastal states and maritime powers have continued to result in incidents at sea. The most notable are the USNS Impeccable case in the SCS around 120 km south of Hainan in 2009, and the case of its sister ship USNS Victorious in the Yellow Sea (Bateman, 2011: 184).

The incidents reflect not only different interpretations and application of the law of the sea, but a fundamental conflict of interest between coastal states and maritime powers. The positions of China and the United States are divided particularly with regard to the meaning of marine scientific research and survey activities, the right to conduct intelligence-gathering activities and military exercises in the EEZ, the principle of peaceful uses of the ocean and certain aspects of the protection of the marine environment in the EEZ (Hayashi, 2012: 796). Even though the United States argued strongly that the Impeccable operated under a legitimate freedom of navigation and tried to justify it using UNCLOS (Pedrozo, 2010), whether a non-state party of the convention has the right to interpret it in its own interest is still a controversial issue. Furthermore, Zhang (2010: 33) challenged the US view by elaborating the terms and provisions of UNCLOS such as ‘marine scientific research’, ‘survey’ and ‘peaceful purpose’, and pointed out that safeguarding the freedoms of navigation and overflight does not equate to conducting military activities in another country’s jurisdictional maritime zones.

In the ASEAN Regional Forum in Hanoi in July 2010, then US Secretary of State Hillary Clinton referred to the SCS as ‘international waters’ and claimed that the United States has a national interest in the freedom of navigation in the area (Japan Times, 2010). It is not appropriate to use the term ‘international waters’, since UNCLOS has already established a maritime EEZ regime wherein coastal states are given significant rights and obligations. Even some US scholars recognised this reality and urged abandonment of the term (Pedrozo, 2010: 17). Furthermore, as rightly observed by some intellectuals, as China never disputed with the United States over the freedom of commercial shipping and stated repeatedly that it respects general freedoms of navigation and overflight in the SCS, what Clinton was asserting was actually the freedom to conduct military research and other survey activities in a foreign state’s EEZ (Bateman, 2011: 178).

China-ASEAN: from DOC to COC

China and ASEAN signed the DOC in 2002, confirming the signatories’ intent to promote pragmatic cooperation and ultimately reach a code of conduct (COC) in the SCS. There have been calls for the establishment of a legally binding COC.

Ten years on, it is equally important to implement the DOC; and 2011, in particular, saw encouraging progress and significant achievement in its implementation. In July China and the ASEAN countries adopted the ‘Guidelines for the implementation of the DOC’ (DOC, 2011), which paved the way for advancing practical cooperation in the SCS. In the Joint Statement of the Fourteenth ASEAN-China Summit to commemorate the twentieth anniversary of dialogue relations in Bali in November 2011, China reiterated its efforts to work with ASEAN countries towards the eventual adoption of a (consensus-based) COC in the SCS to contribute further to peace, security, stability and cooperation in the region.

China stepped up coordination with ASEAN countries to implement a number of projects within the DOC framework in 2011. Premier Wen Jiabao made the important statement at the Fourteenth ASEAN-China Summit on 18 November 2011 that China would establish an RMB3 billion China-ASEAN maritime cooperation fund (Wen, 2011). Such cooperation could start with marine research and environmental protection, connectivity, navigation safety, search and rescue operations at sea and combating transnational crimes, and eventually expand into other fields. This will enable development of multitiered and comprehensive maritime cooperation between China and ASEAN. China proposes working with its ASEAN counterparts to set up a mechanism to study the initiative and work out a plan for cooperation. The National Institute for South China Sea Studies held a seminar on ‘Implementing DOC: Maintaining Freedom and Safety of Navigation in the South China Sea’ in December 2011, representing another major step in bringing about cooperation under the DOC. The senior officials’ meeting on the implementation of the DOC recently held in Beijing again demonstrated China’s resolve and sincerity to work together with ASEAN countries to facilitate active and comprehensive implementation and further practical cooperation in the SCS. China prefers to cooperate through the implementation guidelines and finally work out a COC for all SCS claimant states.

Despite all efforts, 2012 witnessed failure to issue a joint communique at the ASEAN Regional Forum in July – the first such failure in ASEAN’s 45-year history, and resulting from divergence over whether the Huangyan Island standoff should be included (Hunt, 2012). The Philippines and Vietnam have been urging ASEAN countries to speak with one voice against China on the SCS issue, but the 2012 ASEAN Regional Forum seems to prove this not the way out. China will continue to work with ASEAN countries in 2013 on effectively implementing the DOC and promoting the COC step by step in the future.

The involvement of non-claimant states

The United States

The involvement of external powers brings a new dimension to the dispute. In view of ‘at risk’ American national interest in the SCS (Pedrozo, 2010: 19), the Obama administration has adjusted its pivot towards the region, engaged comprehensively in regional affairs since 2009 and become a new key player that complicates the situation.

The long-recognised and abiding US interest in the world’s oceans, including the SCS, is to ensure the openness of sea-lanes of communication for commerce and military activities. The SCS is of critical strategic importance in determining the future of US leadership in the Asia-Pacific region (Cronin and Kaplan, 2012: 7). The US position on the SCS issue has changed over the years, and 2009 can be seen as a turning point. In its policy on the Nansha Islands and South China Sea, released on 10 May 1995, the United States for the first time made clear its interest and presence in and relevant policy on the SCS, marking a milestone in its policy evolution (US Department of State, 1995). On 23 July 2009 then US Secretary of State Hillary Clinton signed the Treaty of Amity and Cooperation at the Sixteenth ASEAN Region Forum. This event is often seen as a starting point for later actions by the Obama administration indicating a US strategic pivot shift towards the Asia-Pacific (Calmes, 2011).

The United States continued to stir up the situation by intensifying its role in the Asia-Pacific region in 2010. In March it is reported that some high-ranking Chinese officials referred to the SCS as China’s ‘core interest’ during a private meeting with two US dignitaries (Yoshihara and Holmes, 2011: 45). There is some worry that by labelling the SCS a ‘core interest’ on par with Taiwan, Xinjiang and Tibet, China will elevate the strategic importance of the sea and protect it at all costs, including use of force (Tran, 2011). Unfortunately, this is just a misinterpretation of the original words. Several Chinese scholars have already clarified the precise context and words at the meeting. China never publicly announced a policy of making the SCS a core interest, while Zhu (2010) makes clear that the original words were actually ‘the peaceful resolution of the South China Sea is the core interest of Chinese government’.

During the Seventeenth ASEAN Regional Forum held on 23 July 2010 in Hanoi, Vietnam, US Secretary of State Hillary Clinton made clear for the first time the Obama administration’s policy on the SCS. She claimed that the SCS involved US national interests and emphasised the significance of maintaining the freedom of navigation in the area (US Department of State, 2010). This statement showed high-profile US involvement in the SCS issue, marking the second milestone in US policy evolution. At the same meeting, Chinese Foreign Minister Yang Jiechi delivered a speech in response to the US statement, and expounded on China’s policy and position on the SCS (Yang, 2010). The debate between the two is widely discussed among intellectuals.

The US strategy of rebalancing was firstly confirmed by President Obama’s participation in the Sixth East Asia Summit, held in Bali in November 2011 (Manyin et al., 2012). Since then, US military officers and politicians have expressed concern over the SCS issue on various occasions. Furthermore, in the same year the United States announced new troop deployments to Australia and new naval deployments to Singapore, updated its military cooperation with the Philippines and secured progress in negotiations to form a Trans-Pacific Strategic Economic Partnership free trade agreement (ibid.: 1).

Among the incentives for the strategic change – growing economic importance of the Asia-Pacific, disputed maritime issues that might hinder freedom of navigation, the winding down of US military operations in the Middle East and the tightened defence budget (ibid.: 2) – the first two are centred on China. On 3 August 2012 the US State Department released another statement on the SCS issue, 17 years after its first statement was made in 1995, claiming that the United States was concerned by the increase in tensions in the SCS and had been monitoring the situation closely (US Department of State, 2012). According to the statement, the United States does not take a position on competing territorial claims over land features, but it believes the nations of the region should work collaboratively and diplomatically to resolve disputes without coercion, intimidation, threats or the use of force. The United States specifically mentioned China, claiming China’s upgrading of the administrative level of Sansha City and establishment of a new military garrison there covering disputed areas of the SCS run counter to collaborative diplomatic efforts to resolve differences and risk further escalating tensions in the region (ibid.).

Repeated US claims of a ‘neutral’ position over the issue are far from convincing in view of its actions and statements (Valencia, 2013). Instead, many Chinese intellectuals see the pivotal change as containing or encircling China (Fatemi, 2013). It is believed that on the one hand the United States will continue to treat China differently from Southeast Asian countries and ensure its leadership in the Asia-Pacific region; on the other hand, it will try to avoid escalating tensions or even military conflicts, ensuing worsened China-US relations and harm to US economic and strategic interests by refraining from giving clear support to any nation’s sovereignty claims in the disputed SCS areas. Therefore the US government’s intervention in the SCS will be balanced in such a way that the fundamentals of China-US relations will not be endangered while effective pressure can be exercised on China.

Japan and India

Beyond the high-profile US involvement, given the geopolitical importance of the SCS, other nations have also been stepping into its affairs through economic and military cooperation and participation in gas and oil exploitation projects and multilateral forums. Japan and India are two examples.

In view of its navigational interest in the SCS, Japan has become another emerging player in the region. Japan’s concern over the SCS is twofold. On the one hand, the SCS is a crucial shipping sea-lane that carries its goods to Southeast Asia and Europe, and 90 per cent of its imported crude oil (Storey, 2012). On the other hand, given the escalating tension between Japan and China over the long-disputed Diaoyu Island (Senkaku Island in Japanese) in the East China Sea, it is reasonable for Japan to keep an eye on China’s arguments and moves.

Japan is involved in the SCS through the use of multilateral forums to express its concerns, help in building up naval capacity of the claimant states and cooperation with other major players in the region. For example, Japan participated in the 2012 Expanded ASEAN Maritime Forum to involve itself actively in the region’s maritime issues (GMA News, 2012). Furthermore, it has agreed to transfer up to ten patrol boats to the Philippine Coastguard, aiming at bolstering its maritime surveillance capacity. It also agreed to upgrade defence relations with Vietnam and join in the discussions with Singapore, Malaysia and Indonesia (South China Morning Post, 2013).

Being a non-direct party to the SCS issue, economic and security interests are the driving force for India’s involvement. India’s state-owned Oil and Natural Gas Corporation (ONGC) has been cooperating in joint ventures with TNK Vietnam and PetroVietnam in conducting offshore hydrocarbon projects in the SCS (Heydarian, 2013). The conflicts between Chinese surveillance ships and Vietnamese seismic survey vessels will negatively affect ONGC’s investment in the disputed maritime zones. Furthermore, India’s security concern in the region is the rapid development and modernisation of the Chinese navy. Traditionally the Indian navy has operated mostly in its immediate waters, stretching from the Strait of Hormuz in the Persian Gulf to the Indian Ocean and Strait of Malacca. Guided by its Look East policy initiated in 1991 under then Premier P.V. Narasimha Rao, at the beginning of the twenty-first century India started to expand its geographic scope towards Southeast Asia and the Pacific (Reischer, 2012). ONGC’s partnership with Vietnam can be seen as a highlight of the policy, and presents a legitimate reason for India to be involved in the region’s affairs.

The Philippines versus China international arbitration

On 22 January 2013 the Philippines sent China a note verbale, attached with a notification, to initiate international arbitration proceedings against China regarding SCS issues (Philippines Department of Foreign Affairs, 2013). On 19 February China rejected the request for arbitration by the Philippines and returned the latter’s note and attachment (Ministry of Foreign Affairs, 2013a). The Philippines then unilaterally submitted the SCS dispute to a UNCLOS Annex VII arbitral tribunal. The Philippines Department of Foreign Affairs declared on 25 March that, as China refused to respond to the arbitration submission, the court’s president, Shunji Yanai, had appointed Polish judge Stanislaw Pawlak to be China’s representative in the tribunal (Phil Star, 2013).

On 26 April China’s Foreign Ministry spokesperson responded by saying that China rejected the Philippines’ move for international arbitration and sought bilateral negotiations and consultations with the Philippines to resolve territorial and maritime delimitation disputes both in accordance with applicable rules of international law and in compliance with the spirit of the DOC. The spokesperson went on to say:

Since the 1970s, the Philippines, in violation of the Charter of the United Nations and principles of international law, illegally occupied some islands and reefs of China’s Nansha Islands, including Mahuan Dao, Feixin Dao, Zhongye Dao, Nanyao Dao, Beizi Dao, Xiyue Dao, Shuanghuang Shazhou and Siling Jiao. China is firmly and consistently opposed to the illegal occupation by the Philippines, and solemnly reiterates its demand that the Philippines withdraw all its nationals and facilities from China’s islands and reefs. (Ministry of Foreign Affairs, 2013b)

In April President Yanai of ITLOS appointed another three members of the tribunal panel, completing it with Judge Chris Pinto of Sri Lanka to serve as president, Judge Jean-Pierre Cot of France and Judge Alfred Soons of the Netherlands (ITLOS, 2013a).However, on 31 May Judge Pinto stepped down as president of the arbitration panel, perhaps because his wife is a Filipino national (Lankasri, 2013). It is also worth noting that the United States, reaffirming its commitment to a defence treaty with the Philippines (Inquirer Global Nation, 2013), seems to be on the Philippine side in the case even though it repeatedly claimed that it does not take sides in the SCS dispute (Ugnayan, 2013). On 21 June Judge Yanai appointed Ghanaian Judge Thomas A. Mensah as the fifth arbitrator and president of the arbitral tribunal to replace Pinto (ITLOS, 2013b).

UNCLOS Article 283 requires the parties to a dispute to ‘proceed expeditiously to an exchange of views regarding its settlement through negotiation or other peaceful means’.3 The Philippines claims in its notification and statement that its obligation to exchange views has been satisfied. This argument is hard to understand, as it is well known that China has been calling for other claimant states, including the Philippines, to engage in direct negation on territorial and maritime disputes. The Philippines has inclined to a regional approach, e.g. putting the dispute under the ASEAN umbrella against China. In its COC draft it insists on including a third-party compulsory settlement mechanism, while China believes that the COC should serve as a conflict management forum rather than a dispute settlement forum (Valencia, 2013). In the Huangyan Island standoff, China has also called the Philippines to a direct negotiation but received only rejection.

Furthermore, China made a declaration under UNCLOS Article 298 to exclude any disputes with relevance to territory, maritime delimitation, historic title and military activities from a third-party compulsory dispute settlement body. Being clearly aware of China’s rationale, in its notification and statement the Philippines tries to delink its statement from the terms ‘territory’, ‘maritime delimitation’ and ‘historic title’. However, in view of the unresolved territorial dispute between the two nations, the compulsory dispute settlement procedures in UNCLOS Annex VII should not be applied to the arbitration. China will adhere to the use of bilateral negotiations in resolving disputes.

Regional cooperation: China’s commitment

Since 2009 China and other littoral countries around the SCS have been confronted with more daunting challenges from non-traditional security factors, underlining the urgency for dialogue and cooperation in this field. To cope with cross-border issues and non-traditional security threats, China has proposed initiatives to conduct preventive diplomacy, especially regarding natural disasters caused by climate change, financial security, piracy and maritime crimes, and terrorism. The principles guiding future cooperation are proposed as follows.

Principles of cooperation in the South China Sea

The first principle is that the ocean should be used for peaceful purposes. This is well illustrated in UNCLOS, in both its preamble and many articles that emphasise peaceful use, plus its provisions on regulating maritime activities in various zones, developing a peaceful dispute settlement mechanism and promoting international cooperation. To stay in compliance with the principle of peaceful use of the ocean, any military activity should comply with the UN Charter, UNCLOS and other applicable international laws.

Second, cooperation should start from less sensitive areas such as marine environmental protection before expanding to more controversial issues. The eventual settlement of the SCS dispute will be a long-term mission which requires adequate wisdom and political courage. It involves addressing both traditional and non-traditional security challenges shaped by a host of unstable and unpredictable factors. In addition to the SCS claimants, the interests of non-claimant states shall be considered. Conflicting interests and lack of confidence- building mechanisms are enabling situations conducive to claimant states pursuing comprehensive and high-profile cooperation. Therefore, a gradual achievement approach should be adopted to strengthen regional cooperation. Specifically, claimant states should start cooperating in less sensitive areas; based on this experience and improved confidence-building mechanisms, the countries can gradually move to more sensitive sectors, such as maritime security. There is successful international cooperation in disputed sea areas that started from less sensitive areas of cooperation, such as fishing, marine scientific research, marine environmental protection and search and rescue operations at sea.

Third, the benefits should be equally shared by all involved parties. We can rely on the spirit and wording of UNCLOS, such as its provisions on ‘solving maritime delimitation on an equitable basis’, ‘equal and efficient use of ocean resources’, ‘equally sharing of the benefit arising from the seabed resources development’ and ‘equitable regional distribution’. Observance of the principle of equality and justice is the only avenue to achieving optimum results in regional cooperation.

Fourth, exploitation and exploration of living and non-living resources should not be at the cost of the marine environment. Regional states in the SCS area, including China, have not done enough to ensure sustainable development of ocean resources, which leads to gradual degradation of the marine ecological environment. In the worst cases, marine species may become extinct. In 2009 more than 30,000 square kilometres of sea area did not meet the water quality standard; about 5,000 square kilometres were severely polluted. The protection of the marine ecological environment requires joint effort among all the countries adjacent to the SCS.

Suggested areas of cooperation

There are several areas in which the SCS countries can cooperate. The first is joint development for oil and gas. Given the nature of oil and gas exploration and exploitation, i.e. high cost and high risk, especially in the SCS basins where geologic conditions are complex, the most efficient and cost-effective way to obtain resources is through joint development on the basis of equal interests and equal sharing of costs and risks. The agreement between China, Vietnam and the Philippines on joint seismic study in the disputed area of the SCS in 2005 gives experience and lessons. We should identify locations in disputed areas where joint development is acceptable, using an agreed method of cooperation. Where necessary, third-party states with advanced technology and sufficient financing should be encouraged to participate.

Second is joint management and conservation of fisheries. Under UNCLOS, coastal states are responsible for and obliged to manage and conserve fishery resources. Fishing conflicts occur frequently in disputed sea areas due to territorial issues and the lack of maritime boundary delimitation. Unfortunately, the fishing administrations of the SCS states do not cooperate directly in many management and conservation matters, such as allowable catch or capacity to harvest fishery resources, and different states simply enforce different fishing laws without coordinating and cooperating with each other. Another closely related issue is the illegal, unregulated and unreported fishing activity in the SCS. The China-Vietnam Agreement on Fishery Cooperation in the Beibu Gulf is a successful example for emulation and learning. One option could be to define a common fishing zone or establish a regional fishing organisation in the Nansha areas to share management and conservation responsibilities for fish resources and deal with illegal fishing activities. Also, fishermen detained for fishing in disputed areas should be properly treated.

Third is cooperation in navigational safety and search and rescue at sea. The importance of the SCS as a strategic passageway is unquestionable: it contains critical sea-lanes through which oil and many other commercial goods flow from the Middle East and Southeast Asia to East Asia. Similarly, more than 80 per cent of the crude oil supplies for Japan, South Korea and Taiwan flow through the SCS from the Middle East, Africa and SCS nations. The SCS is of vital importance to the region because of its rich natural resources. Many countries have increasingly engaged in the exploration, exploitation and transportation of offshore oil and gas in the disputed sea areas: it is therefore worrying that, except for Singapore, most Southeast Asian countries do not have enough capacity and emergency response mechanisms to cope with oil spills and pollution damage compensation. Oil spills, as in the case of the Gulf of Mexico in 2010, or tanker collisions could lead to large-scale disaster and unpredictable consequences. We must learn from developed maritime states which have created their own response mechanisms, such as the United States, which has established ten emergency response bases and 27 facility provision bases to provide support to an accident location within 24 hours. Japan is another good example: its Centre for Disaster Prevention at Sea owns ten emergency response centres and 33 facility storehouses, together with 11 reserve bases for oil-spill emergency response along its major sea-lanes of communication. Similar mechanisms should be created for the SCS region.

Fourth is cooperation in combating transnational maritime crime. The SCS and Strait of Malacca are vulnerable to attacks associated with piracy, maritime crimes and maritime terrorism. The Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia (2010) annual report shows increased piracy and armed crimes in Asia, with 17 piracy incidents in the SCS, 55 per cent more than in 2009. Effective cooperation is urgently needed to secure navigational safety in the SCS. Experiences and lessons can be learned from law enforcement practice in the Strait of Malacca and Gulf of Aden, such as joint patrolling, using safe navigation lanes regulated by international standards and adequate information sharing.

Last but not least, cooperation in marine scientific research and marine environmental protection is needed. The SCS is one of the most biologically diverse marine ecosystems in the world. This makes it a perfect location to study geological evolution in the west Pacific, prevention of marine disasters and climate change. Research projects on biological diversity, coral reef protection and sea-level rise, among others, will contribute to sustainable social and economic development of the regional states. This requires the collective wisdom of academics of all disciplines, and cooperation among governmental and non-governmental agencies of different countries. A couple of recommendations from the author are developing a comprehensive environment monitoring system for the SCS and establishing marine biological research stations in the disputed Nansha areas.


Over the years efforts have been made to stabilise the longstanding SCS dispute, such as the adoption of the 2002 ASEAN-China Declaration on the Conduct of Parties in the SCS by China and ASEAN nations. After a short period of tranquillity, 2009 became a turning point for a new round of escalation of the dispute, marked by the joint submission by Malaysia and Vietnam on the outer limit of the continental shelf. This wrap-up chapter assesses the new layers of complexity to the SCS dispute, both between traditional claimant states and with the involvement of other powers outside the region.

Five major categories of relevant events during the past five years are selectively assessed. The submissions to the CLCS of the outer limit of the continental shelf and their objections reignited a new round of tension. China’s objection to the joint submission by Malaysia and Vietnam, enclosing a map with the U-shaped line, has been intensively discussed over the years, as is critically sketched in Chapter 3. States such as the Philippines and Vietnam also consolidated their claims by bringing them into national legislation. China responded to these actions by establishing Sansha City, announcing the offer of nine oil blocks for bid and revising its local regulation on legalising foreign ship activities within its territorial sea. The chapter explored incidents at sea, in particular those between China and the United States, with regard to the ‘freedom of navigation’ debate. It also studied claimant states’ efforts in implementation of the DOC, and the involvement of new players: the United States, Japan and India. It seems to the author that the number of players will increase in the future and the United States will continue to have a significant role in the issue with its support to allies and participation in multilateral forums in the region. The UNCLOS Annex VII arbitration of the Philippines versus China is of international significance, as it is the first attempt to bring the longstanding dispute to compulsory third-party settlement. The case is worth following in the future.

Regardless of the result of the Philippines versus China arbitration, the dispute will not be resolved any time soon. All SCS bordering parties should work together towards a peaceful resolution. The author proposes four principles that should be guidance for future cooperation: peaceful uses of the sea, step-by-step efforts, equal sharing of benefits and environmentally friendly exploration. Five potential areas of cooperation are identified: oil and gas exploration, fisheries reservation, search and rescue projects at sea, combating transnational crime, and marine scientific research and environmental protection. While a grand maritime cooperative regime is still missing, China is prepared to cooperate with all other parties in the SCS more extensively and substantively in these areas.

1Article 1 of the Law of the Sea of Vietnam states the law ‘provides for baseline, the internal waters, the territorial sea, the contiguous zone, the exclusive economic zone, the continental shelf, islands, the Paracel and Spratly archipelagos and other archipelagos under sovereignty, sovereign rights and jurisdiction of Vietnam’.

2The author’s opinion was reported by Reuters (2012).

3The UNCLOS Article 283 obligation to exchange views provides: ‘1. When a dispute arises between State Parties concerning the interpretation or application of this Convention, the parties to the dispute shall proceed expeditiously to an exchange of views regarding its settlement by negotiation or other peaceful means. 2. The Parties shall also proceed expeditiously to an exchange of views where a procedure for the settlement of such a dispute has been terminated without a settlement or where a settlement has been reached and the circumstances require consultation regarding the manner of implementing the settlement.’