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Towards a Zero-Sum Game? The South China Sea Conundrum

Updated: Nov 28, 2023

Indo-Pacific Analyst

USS John S McCain in the South China Sea, 2017 | Credit: Wikimedia Commons

The question of the South China Sea remains one of the most pertinent challenges facing the world. Tensions over the disputed territories encompassed by China’s ‘nine-dash line’ have drawn both regional powers and Western states into a geopolitical question which continues to verge on political deadlock. This 3,500,000 square kilometres (1,400,000 sq. mi) of ocean and the island chains within it have played host to all sorts of political drama and high-seas intrigue; yet even the constant stream of news articles on minor developments in the region belies the almost overwhelming complexities which have plagued efforts to escape the diplomatic impasse. In rhetorical terms, the South China Sea issue is often portrayed as a key battleground of a ‘new Cold War’ between Washington’s historically ‘dominant’ presence in the Asia-Pacific and Beijing’s rising status as a ‘challenger’.

The origins of tensions in the region have only been exacerbated in recent years with the U.S.’s turbulent diplomatic pivoting during the Trump administration, and the ongoing Russo-Ukrainian conflict has thrown the region’s diplomatic alignments into sharper focus. As a flashpoint of superpower tensions, the South China Sea dispute remains a challenging and multi-faceted issue for all the powers involved, a fact driven in large part by the national, regional, and global stakes involved. Recent diplomatic efforts—at both the bilateral and multilateral level—continue to highlight the untenable situation in the region, whilst falling short of progressing feasible solutions to resolve it. How, it must be asked, might those involved in the question of the South China Sea work towards a peaceful modus operandi in the region? What challenges continue to prevent meaningful diplomatic action on the territorial dispute, and how pertinent is the issue in the bigger picture of international relations?

In terms of consequences, heightened tensions in the South China Sea reverberate beyond the regional scale. The waterway’s value to international trade and the global economic system is hard to overstate: a 2016 United Nations Conference on Trade and Development (UNCTAD) report estimated that one-third of global shipping passes through the South China Sea, amounting to just under $3.5 trillion in exports and imports. Furthermore, the region’s rich fishing grounds and biodiversity make it a lynchpin in the livelihoods of millions of citizens in neighbouring countries.

Yet the region’s most important economic statistic lies in its energy resources: the US Energy Information Agency estimates that, in terms of proven and probable reserves, almost 190 trillion cubic feet of natural gas and 11 billion barrels of oil lie around the margins of contested territory in the South China Sea. In addition, projections by the U.S. Geological Survey and its Chinese counterpart place the volume of undiscovered reserves at around 160 trillion cubic feet of natural gas and 12 billion barrels of oil. As a result, access to these valuable resources is inextricably tied to the larger challenge of determining territorial and economic rights for claimant states in the South China Sea disputes.

Beyond the economic dimensions, any confrontation in the South China Sea possesses serious ramifications for the political configurations in the Asia-Pacific region and beyond. Deeply embedded within Beijing’s quest for superpower status is a desire to enhance its hard-power projection capacities in a naval sense—synthesising both green and blue-water capabilities into the People’s Liberation Army Navy (PLAN). To that end, land reclamation efforts as well as military facility construction projects in the Spratly and Paracel Islands have augmented China’s presence in the region and, in a literal sense, cemented its assertiveness in upholding the nine-dash line—a shorthand term referring to the nine dashes which Chinese authorities have repeatedly utilised on maps of the South China Sea to illustrate their claims.

Satellite imagery showing a runway and military installations on Fiery Cross Reef, August 15, 2018 | Credit: CNN

In regional terms, Beijing’s claim of ‘indisputable sovereignty’ over most of the South China Sea problematizes the overlapping position of other claimant states—including the Philippines, Malaysia, Vietnam, Brunei, and Indonesia. In the legal sense, the nine-dash line stands in direct contradiction to the 1982 United Nations Convention on the Law of the Sea (UNCLOS), a fact which was brought before the Permanent Court of Arbitration (PCA) by the Philippines’ government in 2016. The subsequent ruling declared China’s ‘historic claim’ of the nine-dash line as legally questionable and therefore unfounded when utilised as justification for total sovereignty over the South China Sea—a conclusion which Beijing unsurprisingly deemed inapplicable. However, as Oriana Mastro illustrates, legal arguments for and against China’s action in the region are a minefield of hypocrisy and complexity. Washington cannot utilise UNCLOS against Beijing on the grounds that it has yet to ratify the treaty itself, whilst the Freedom of Navigation Operations (FONOPs) and patrols conducted by the U.S. Navy are interpreted by China as a violation of international law.

Adding to this legal obstacle is how interconnected the South China Sea question is to other crucial geopolitical issues in the Asia-Pacific. The situation of Taiwan, which has its own claims in the region, is inextricably linked to the matter. If the U.S. and China were to escalate matters in the South China Sea, it is entirely plausible to forecast that Xi Jinping’s strategy would include stepping up military demonstrations to reiterate that the ‘breakaway province’ is part and parcel of any armed confrontation across the straits. Such a move would not only constitute a massive gamble for China but would also pose serious consequences for the economic and political fortunes of regional powers. In a hypothetical situation where the SCS became closed off to all shipping due to a conflict, research from the University of Virginia has highlighted the disparity in economic strain for the region—where the ability of nations to avoid a crisis would be dependent on their capacity to offset international trade losses with domestic expenditure.

In 2023, the South China Sea’s significance for global diplomacy increased in the wake of the Russo-Ukrainian War and a resumption of Sino-American tensions. The various alliances, blocs, and spheres of influence in the Asia-Pacific region have all played into the challenges and opportunities regarding the territorial dispute. In particular, the Association of Southeast Asian Nations (ASEAN) has struggled to progress negotiations on a Code of Conduct (COC) over the South China Sea with China, with the recent ministerial meetings in Jakarta producing an oft-heard commitment to continue the dialogue towards a COC whilst integrating the foundations of international law and the 2002 Declaration of Conduct (DOC). Beijing’s own foreign policy towards the ASEAN nations is often Janus-faced, since its growing influence on the Member States has been largely underpinned by the Belt and Road Initiative (BRI), which is itself predicated on cultivating closer ties to each of the recipient countries.

As the Biden administration aims to shore up its own commitments in the Australasian region and Russia seeks to escape its diplomatic isolation, it is clear that the question of the South China Sea will continue to loom large on the agendas of the involved parties. Is the region therefore headed towards a classic example of Thucydides’ Trap? Certainly, the South China Sea question is tied up with stakes that would merit such a proposition, but the reality is far more complex than the IR term would denote.

The dynamics of international relations in the region make it impossible for one superpower to emerge as the sole hegemon. This is not merely a game of chess between Washington and Beijing, where each side seeks to manoeuvre their pawns in the region to an advantageous position. Despite the prominent bilateral agreements between claimant states and the superpowers—chief among them the Filipino-American 1951 Mutual Defence Treaty—multilateral negotiations have so far proven more successful in asserting the legitimacy of all parties’ positions on the issue. Furthermore, the region’s other ‘middle’ powers such as Australia, India, and Japan have voiced their stake in ensuring a peaceful outcome to the deadlock which has hitherto characterised the SCS dispute.

It might be better to consider the larger geopolitical picture in the region as one of checks and balances, where aggressive action (usually on the part of China) can result in a more assertive stance by a claimant state—a trend which the Philippines has shown in recent confrontations between their fishermen and the Chinese coast guard. On the flip side, Washington’s diplomacy in the region would benefit from a more conciliatory approach, rather than the classic ‘waving of the big stick’ rhetoric which has accompanied the dispatch of carrier task forces and joint naval exercises in the region.

If a binding COC is to be reached on the South China Sea, then there are some key questions which must be discussed and compromised on by all parties: how will the precedent established by agreed-upon international law factor into the rules for the region? What consequences will be present should a ratifying power break any provision of the Code? How are military assets to be treated in the South China Sea, given their volatile significance to the posturing of certain states? How will access to natural resources in the region fit within (or circumvent) the rights provided under Exclusive Economic Zones (EEZs)? All these questions require a serious commitment on the part of all negotiating powers to comprehensively tackle the issue, lest one side utilise a loophole or omission to further their own national agenda in the South China Sea in the future.

Should the question be escalated beyond the regional forums and brought before global forums? Past instances such as the 2016 Hague Tribunal ruling and repeated mentions of UNCLOS seem to suggest that such moves are unlikely to bring about any meaningful result towards a resolution of the overall situation. Here, China’s own preference to avoid ‘megaphone diplomacy’ (to use a term from one of its diplomats), aligns with the U.S.'s wish to avoid escalating what Washington views as a largely regional issue and risk drawing in more countries.

What might be more beneficial in terms of UN action might be meetings to discuss corollary issues included within the disagreements and disputes in the South China Sea. These include but are not limited to the aforementioned distinction between freedom of access for economic and military purposes, the inviolability of EEZs, and the potential revision of UNCLOS to ensure greater ratification and acquiescence on the part of great powers. All of these negotiations are likely to present their own challenges, but at the very least they will provide a space for all parties involved in the SCS dispute to voice their individual concerns without worrying too much about pre-existing diplomatic alignments —a problem which has repeatedly plagued ASEAN’s own solidarity on the matter.

In summation, the South China Sea conundrum certainly has the trappings of a zero-sum game in geopolitics: what one side stands to gain in economic and political power is equivalent to the potential loss in store for another. However, the multipolar nature of the situation and its interlocking consequences suggest that there is no feasible situation in which one party can ‘win’ without severely damaging its own economic prospects or political relations. Nor is this maritime pathway merely a prominent flashpoint for the ongoing Sino-American ‘Cold War’, as some commentators have suggested. Whilst the current modus vivendi is certainly undesirable and contains the seeds of future confrontation, it is wholly within the power of all involved to work slowly yet surely towards a comfortable and mutually beneficial arrangement in the region. The main obstacle towards the achievement of that goal is whether the diplomatic will and initiative exists to continue ongoing negotiations and explore new avenues of discussion.


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