The 20th anniversary of the discussion between ASEAN countries and China on an important regional document, the South China Sea Code of Conduct, is in the offing. The code should replace the like-tenor declaration signed in Phnom Penh in 2002 found to be ineffective. Prepared in 2017, the framework draft document was planned to be finalized and signed next year, but the process was slowed down over the pandemic as the procedural reason. The real one, according to observers and experts, was the change in both the regional and global military-political landscape.
In geostrategic terms, the importance of the South China Sea region can hardly be overestimated. It is home to a third of the world's shipping traffic with a cargo turnover of about $3.5 trillion per year. In particular, the Strait of Malacca linking the Indian and Pacific oceans, accounts for 80% of China's energy imports and 60% of its total trade. Large oil and gas reserves have been explored in the South China Sea. Besides, this area is one of the five richest in fish resources.
Global economic development decentration to Southeast Asia has intensified the pursuit of interests by both regional and global players. As luck would have it, open forms of this struggle between regional states have manifested themselves in territorial disputes. This refers to a group of Paracel (Xisha) Islands and the Spratly (Nánshā) archipelago claimed by Brunei, Vietnam, China, Malaysia, Taiwan and the Philippines.
It frequently came to armed clashes, but with China's strengthened economic and military power, territorial disputes have taken a political and diplomatic turn. Having created a free trade zone, ASEAN countries and China have mutually become the largest trading partners with a turnover exceeding an annual $2 trillion. Beijing has signed a number of agreements with almost all the Southeast Asian countries under the Belt and Road Initiative. President of the Philippines Rodrigo Duterte provided the best description for the current objective reality, having frankly stated the following: "You don't mess with China, no one will be able to take up arms against it anyway."
All of this allowed Beijing's active developing of the disputed territories, starting in 2013. Currently, the Paracel Islands, as well as most of the Spratly archipelago, are de facto used by China. Chinese specialists carry out large-scale hydraulic engineering and construction works to create artificial islands, build runways, airplane sheds, mooring berths and other infrastructure facilities. Moreover, China's People's Liberation Army has deployed cruise missiles, air defense systems, fighting aircraft alert force, radars and electronic reconnaissance posts in the islands.
By the end of the current decade, numerous claimants to the islands and reefs of the South China Sea had come to terms with China's dominance in this region and, lacking opportunity to develop disputed territories, preferred to initially derive economic benefit from the situation at hand. Duterte's phrase relevant to the "might is right" idiom, has acquired a specific content.
At the same time, China's rise in the SCS caused an acute negative response with Washington, which considers this region a zone of its political and economic interests. Exercises of the US Navy's 7th fleet are constantly held in the waters of the South China Sea. Besides, US Navy ships regularly perform maneuvers as part of the freedom of navigation protection program, deliberately entering the territorial waters of disputed islands.
After President Trump announced a "crusade" against China and the Chinese Communist Party, the situation in the South China Sea zone became noticeably tense. In July this year, the US State Department issued a statement emphasizing that Beijing's claims to natural resources in most of the South China Sea are absolutely illegal. Apparently, to make it more convincing, the same month witnessed two American aircraft carriers and a B-52 strategic bomber conducting a snap drill in the South China Sea for the first time in six years.
China returned the favor in August and held the third exercise in 24 months around the Paracel Islands, with two launches of medium-range ballistic missiles made from the mainland targeting a closed sea area. During the exercise, there were two delicate episodes involving the US armed forces. The former one involved the American U-2 reconnaissance aircraft, and the latter one – the USS Mustin guided missile destroyer invading areas prohibited for flights and navigation. Chinese Foreign Ministry spokesman Zhao Lijian, in turn, said that the United States should stop stirring up and undermining peace and stability in the South China Sea.
Apart from muscle-flexing, Washington has stepped up efforts in several areas to counter and contain China through political means.
First of all, attempts to invigorate the four-party dialogue between the United States, Japan, Australia and India to create an alternative to the Belt and Road initiative which started way back in 2007, have resumed.
Secondly, a multifaceted game has begun in a bid to make the region's countries to return to the acute phase of territorial disputes. Premium is placed on Vietnam and Taiwan. In particular, Hanoi has already lambasted China's proposals for a South China Sea Code of Conduct and, after a long break, condemned the latest Chinese exercises in the Paracel Islands.
Thirdly, anti-Chinese performance lobbying by various international structures and organizations has increased. In particular, there was an active discussion of the half-forgotten four-year-old decision of the Hague court that the PRC does not have any right to the disputed territories.
There is no doubt that amid the general degradation of US-Chinese relations, the tension in the South China Sea will increase. At the same time, the presence of the two nuclear powers' armed forces within arm's reach raises the risk of turning this area into a zone of hot conflict with unpredictable consequences.