Journal of Political Risk, Vol. 4, No. 5, May 2016

Sean R. Liedman

Abstract:  

Since the end of World War II, U.S. strategy towards China has tacked between three central policy themes: containment, cooperative engagement, and competition. Additionally, a fourth unstated strategic theme undergirds the above: prevailing in the event of conflict. Even though they are fundamentally conflicting ideas, the principles of cooperation and competition remain central tenets of the U.S. strategy versus China today, and the tension between those two principles has been on full display in the South China Sea since 2012. Looking to the future, the United States has three broad policy options vis-à-vis recent Chinese activities in the South China Sea: 1) “Continued concession” to Chinese territorial expansion in the South China Sea in the interest of achieving broader strategic objectives, 2) “Freeze the status quo”, or 3) “Roll back” Chinese expansion and excessive sovereignty claims. Key observable metrics will indicate which of these policy options is being followed, the range of diplomatic and military strategies to achieve those policy aims, and their likely outcomes.

Since the end of World War II, U.S. strategy towards the People’s Republic of China (hereafter China) has tacked between three central policy themes: containment, cooperative engagement, and competition. Additionally, a fourth unstated strategic theme undergirds the above: prevailing in conflict, which since 1949 has principally revolved around the threat of forceful reunification of Taiwan but is expanding to include the potential for conflict over disputed sovereignty and maritime claims in the South China Sea.  

Before examining the current situation in the South China Sea and U.S. policy and strategy options, it is necessary to briefly review the history of the military aspects of the U.S.-China relationship as some historical themes continue to shape both U.S. and Chinese strategy today. Additionally, any study of the sub-strategies in the South China Sea must include the context of the broader political, economic, and military relationship at that time. In the interest of brevity, this review will start with the end of World War II, although earlier themes such as the “Century of Humiliation” in the latter half of the 19th and first half of the 20th century continue to influence Chinese strategic thinking.

One other note – there are many different contextual definitions of the words “policy” and “strategy”. For the purposes of this paper, I will use the following framework: strategy is defined as “the ways in which the available means will be employed to achieve the ends of policy”.

1945-1950: Circumspect Engagement

In the aftermath of the destruction of the war against Imperial Japan, Allied powers led the effort to restore the sovereignty of states and territories that were occupied by the Imperial Japanese Army during the war, including the Republic of China. This phase of U.S. strategy was a period of “circumspect” cooperative engagement due to the fact that many U.S. policy makers and military leaders loathed Chiang Kai Shek’s mismanagement, corruption, and human rights abuses. Despite the billions of dollars in cash and military equipment that the U.S. granted in aid to the Republic of China during this period, the defeat of Chiang’s Nationalist Forces during the summer of 1949 by Mao’s People’s Liberation Army (PLA) triggered a vigorous public debate in the U.S. over “Who Lost China?”

Hard-liner “China hawks” (mostly Republicans) argued that more ardent support for Nationalist China could have stopped the spread of communism and blamed the Truman administration’s “China Hands”, who insisted that the rot of Chiang’s regime was too deep to be salvaged. While the terms of reference have changed slightly, echoes of this divide persist in U.S. policy and strategy making today. In 2013, Justin Logan wrote that the “optimists (liberal doves)” favor a policy of engagement, while the “pessimists (conservative hawks)” favor a policy of containment. The resulting compromise has often been a muddled policy of “congagement” during the history of the relationship.

Within the broader context of this period, following the surrender of Japan the authority of the South China Sea Islands was put under the jurisdiction of the Republic of China (ROC) in December 1945 and ROC troops occupied Woody Island in the Paracels. The Republic of China published a “Map of South China Sea Islands” in 1947 that depicted eleven dashes around the perimeter of the South China Sea, within which China claimed the island features.

1950-1972: Containment

The defeat of Chiang’s Nationalist forces by the PLA in 1949 and the Chinese intervention in the Korean War in the fall of 1950 triggered a hard shift by the Eisenhower administration to an explicit strategy of containment. Additionally, the U.S. refused to formally recognize Mao’s communist People’s Republic of China as the legitimate government of China. Accordingly, the U.S. intervened with naval forces of the U.S. Seventh Fleet in the Taiwan Straits three times in the 1950’s to protect Chiang’s Republic of China (now encamped solely on the island of Taiwan and a few islands in the Taiwan Straits) from PRC aggression. Chinese resentment of this era of containment continues to resonate in today’s U.S-China strategic relationship, as discussed below.  

Against the backdrop of the communists’ battlefield victories on the mainland, ROC troops retreated from the Paracel Islands to Taiwan on May 8, 1950 out of tactical considerations. However, the Republic of China did not renounce its authority over the Paracel Islands at that time or later. China usurped the Republic of China’s claims to the island features in the South China Sea and published the same map, although two dashes in the Tonkin Gulf were subsequently removed, creating China’s “nine-dash line” claim that is maintained to the present. Additionally, China occupied Woody Island in the Amphitrite Group of the Paracel Islands in 1950 – its first territorial expansion in the South China Sea.

1972 – 1986: Hollow Engagement

President Nixon’s historic visit to China in 1972 and resultant policy of détente led to a gradual shift to a strategy of cooperative engagement. However, there was virtually no Chinese military activity to engage with as the PLA focused inward on lingering internal security issues stemming from the Cultural Revolution and a violent border clash with the Soviet Union on the Xinjiang and Manchurian borders in 1969.

U.S. diplomatic recognition of China in 1979 and the Reagan administration’s staunch anti-Soviet stance triggered a series of policy debates about the merits of selling military arms to China to deepen Sino-American cooperation and provide China with the means to serve as a bulwark against the mutual fear of further Soviet expansion in Asia. June Teufel Dreyer, testifying before the Senate Committee on Foreign Relations in 1981, labeled the People’s Liberation Army Navy (PLAN) “mainly a coastal defense force” that “…rarely venture beyond the PRC’s territorial waters.” Additionally, she stated that “The PLA Air Force (PLAAF) has been judged relatively weaker during the 1970’s than it was in the 1950’s”. By 1985, the debates over arms sales had matured into the sale and delivery of twenty-four S-70 Sikorsky helicopters and substantive negotiations of Chinese purchases of advanced anti-tank weapons, surface-air missiles, naval sonar systems, and naval ship self-defense systems.  

In the South China Sea during this period, there was an armed clash between China and the Republic of Vietnam (South Vietnam) in 1974 over sovereignty of the Crescent Group in the Paracel Islands. The U.S., reeling from its strategic defeat in the Vietnam conflict and eager to deepen détente with China, passively watched while China militarily ejected the Vietnamese and consolidated its control over the Paracels.

1986-2001: Accelerating – But Oft Interrupted – Engagement  

U.S. Secretary of the Navy John Lehman’s visit to China in August of 1984 paved a path to accelerate naval engagement with China. After two years of internal wrangling within Chinese Communist Party leadership, including recollections of foreign naval domination during the Century of Humiliation, three U.S. Navy ships pulled into the port of Qingdao on November 5th, 1986 – the first visit to China by U.S. Navy ships in more than forty years. Secretary Lehman found a willing partner in General Liu Huaqing, who as Commander of the PLAN was determined to transform it from a coastal defense force into a blue-water Navy.  

During this period of increasing cooperative engagement, China engaged in another naval clash with Vietnam over contested land features in the South China Sea in 1988 – this time in the Spratly Archipelago. China devised a plan to occupy nine vacant features in the Spratlys in 1987, and after a deadly clash on March 14th, 1988 at Johnson South Reef in which seventy-four Vietnamese Sailors and Marines were killed, China had gained control of six of those features.  In the same fashion as the 1974 Sino-Viet clash in the Paracels, the U.S. did not intervene to prevent the use of force to resolve a sovereignty dispute in the South China Sea.  

Arms sales negotiations and senior defense leadership engagements continued at a quickening pace until they came to an abrupt halt following the Tiananmen Square massacre in June of 1989, when the U.S. and Europe enacted an arms embargo against China and the U.S. severed all military contacts. The embargo generated four strategic consequences that linger in the U.S.-China relationship today. The first is a Chinese sense of betrayal by the U.S. in that a series of good faith negotiations were terminated due to disagreement over an issue that was purely an internal affair of China – in stark violation of China’s stated “non-interference” principle of foreign policy. This sense of betrayal was further aggravated by the U.S. sale of 150 F-16 fighter aircraft to Taiwan in 1992. Second, the Chinese perceived that the U.S. was officially retrenching to a strategy of containment, which was inflamed by headlines in the western media like Time magazine’s “Why We Must Contain China”. Third, the Chinese turned back to Russia to procure advanced weaponry. Flush with cash from double-digit GDP growth rates beginning in 1992, but struggling to build a mature technology base, the Chinese proceeded to purchase Russian-built SU-27 and SU-30 fighter-ground attack aircraft, T-72 tanks, S-300 (SA-10 in NATO terminology) surface-to-air missiles, IL-76 transport aircraft, KILO class diesel submarines, and Sovremennyi-class destroyers over the next five years. Additionally, the cash-strapped Russians granted licenses to build SU-27 and SU-30 aircraft in China, which provided manufacturing expertise and multiple technology spinoffs for the Chinese defense industrial base. Finally, the arms embargo accelerated the pace of Chinese “illicit technology acquisition” efforts, principally aimed at the U.S. The Chinese effectively used ethnic Chinese targeting, Chinese ‘moles’ in the U.S. government, false front companies, and transactions with unscrupulous arms dealers to acquire U.S. technologies before discovering the “holy grail” of illicit acquisition – cyber theft. It is no coincidence that the Chinese J-20 and J-31 fifth-generation stealth fighter aircraft strongly resemble Lockheed Martin’s F-22 and F-35 fighter respectively; China reportedly digitally pilfered terabytes of data from Lockheed Martin and six subcontractors.

U.S.-Chinese military cooperation in the 1990’s resembled a wild roller coaster ride. Military dialogue resumed in October 1993 but then halted again during the Taiwan Straits Crisis of 1996.  Military contacts were revived on the heels of two summits between Presidents Bill Clinton and Jiang Zemin in October of 1997, but were suspended yet again after the accidental U.S. bombing of the Chinese embassy in Belgrade during Operation ALLIED FORCE in May of 1999.  Military contacts were re-started in May of 2000 when Admiral Dennis Blair (Commander-in-Chief, U.S. Pacific Command) visited China, but were suspended again less than a year later due to a tactical incident that had strategic consequences, as discussed below.

China’s entry into the Spratlys sparked increased tensions and competition in the South China Sea as various claimant states took measures to stake out and defend their claims. China occupied Mischief Reef in 1994 – its seventh occupied feature in the Spratly Archipelago – while the Republic of the Philippines ran a Navy ship (BRP Sierre Madre) aground on Second Thomas Shoal in 1999 to defend their claim.

2001-Present: “Coopetition”

The first foreign policy crisis of President George W. Bush’s new administration was the “EP-3 incident” off Hainan Island on April 1st, 2001 when a U.S. Navy EP-3 surveillance aircraft conducting a reconnaissance mission in international air space suffered a mid-air collision with a PLAN J-8 fighter jet. The Chinese pilot was killed and the crew of the EP-3 executed an emergency landing at Lingshui Air Field on Hainan Island. Twenty-four U.S. Navy aircrewmen were detained and interrogated by the Chinese for 11 days before being released back to U.S. custody.  

China’s increasing military capabilities and assertive military operations – many of which were clearly designed to counter U.S. and allied interests in the Asia-Pacific region – were spawning a new era of strategic competition. In recognition of China’s growing economic and military might, the Bush administration inferred that China was emerging as a competitor in its 2001 Quadrennial Defense Review:

Although the United States will not face a peer competitor in the near future, the potential exists for regional powers to develop sufficient capabilities to threaten stability in regions critical to U.S. interests. In particular, Asia is gradually emerging as a region susceptible to large-scale military competition. …Maintaining a stable balance in Asia will be a complex task. The possibility exists that a military competitor with a formidable resource base will emerge in the region.

The September 11th, 2001 attacks and resultant war in Afghanistan, followed by the initiation of the war in Iraq, diverted massive amounts of U.S. military resources away from the Asia-Pacific region and reduced the U.S. attention span for managing the military relationship with China.  U.S. Secretary of Defense Donald Rumsfeld’s first visit to China occurred in October 2005, and military ties between senior defense officials subsequently resumed.

The 2006 Quadrennial Defense Review acknowledged this emerging environment of coopetition by using the words “compete” and “partner” in the same paragraph:

Of the major and emerging powers, China has the greatest potential to compete militarily with the United States and field disruptive military technologies that could over time off set traditional U.S. military advantages absent U.S. counter strategies. U.S. policy remains focused on encouraging China to play a constructive, peaceful role in the Asia-Pacific region and to serve as a partner in addressing common security challenges, including terrorism, proliferation, narcotics and piracy.

Soon after the Obama administration assumed office, Secretary of State Hillary Clinton declared that “the United States is back” in Asia in a number of fora in the summer of 2009 to signal that the administration believed that the geo-strategic center of gravity for the U.S. lies in the Asia-Pacific region. The Obama administration’s 2010 Quadrennial Defense Review continued to echo the cooperative side of the strategy, but painted a harsher picture of the increasingly competitive side of the relationship, along with the potential for conflict:

As part of its long-term, comprehensive military modernization, China is developing and fielding large numbers of advanced medium-range ballistic and cruise missiles, new attack submarines equipped with advanced weapons, increasingly capable long-range air defense systems, electronic warfare and computer network attack capabilities, advanced fighter aircraft, and counter-space

systems. China has shared only limited information about the pace, scope, and ultimate aims of its military modernization programs, raising a number of legitimate questions regarding its long term intentions.

China’s growing presence and influence in regional and global economic and security affairs is one of the most consequential aspects of the evolving strategic landscape in the Asia-Pacific region and globally. In particular, China’s military has begun to develop new roles, missions, and capabilities in support of its growing regional and global interests, which could enable it to play a more substantial and constructive role in international affairs. The United States welcomes a strong, prosperous, and successful China that plays a greater global role. The United States welcomes the positive benefits that can accrue from greater cooperation.

In the fall of 2012, the Obama administration announced that the U.S. was strengthening its commitment to Asia in a series of articles and speeches, and the 2012 Defense Strategic Guidance formally labeled this policy initiative the “rebalance toward the Asia-Pacific region.”  The Congressional Research Service summarized the major elements of the rebalance as increasing military presence in the Asia-Pacific region, strengthening security relationships with regional allies, building new security partnerships in the region, and strengthening economic ties by joining the East Asia Summit and negotiating the Trans-Pacific Strategic Economic Partnership (TPP).

Predictably, some Chinese media commentators reacted to this U.S. rebalance to Asia as an effort to “restrain” or “contain” China’s rise and influence. As an example, noted military expert Liu Jiangping suggested in China’s Global Times that the U.S. was “tightening up” a “containment circle” along mainland China’s periphery. U.S. senior officials attempted to dispel this notion of containment. U.S. Secretary of Defense Leon Panetta, speaking at the Engineering Academy of the PLA in September 2012 stated:

Our rebalance to the Asia-Pacific region is not an attempt to contain China.  It is an attempt to engage China and expand its role in the Pacific.  It’s about creating a new model in the relationship of our two Pacific powers.  It’s about renewing and revitalizing our role in a part of the world that is rapidly becoming more critical to our economic, diplomatic, and security interests.  And as I’ve made clear, essential to all of these goals — essential to these goals is a constructive military-to-military relationship with China.  

In spite of lingering mistrust based on the tumultuous history of the relationship, military cooperation was deepening on many fronts. With the PLAN eager to demonstrate that it had matured from a regional to a global Navy, China has sustained a counter-piracy naval task force in the Horn of Africa region since 2009, and the U.S. and Chinese navies have cooperated during those counter-piracy operations. Additionally, the PLAN sent four ships to participate in the U.S. Pacific Fleet’s crown jewel Rim-of-the-Pacific (RIMPAC) exercise in waters off Hawaii in 2014.  As a reflection of the “coopetitive” nature of the relationship, the PLAN also sent an uninvited Dongdiao-class Auxiliary General Intelligence (AGI) ship that monitored U.S. and allied Navy radar, sonar, and radio emissions and tactics during the exercise. Military contacts also accelerated at the tactical level in 2015 as PLAN ships conducted port visits in Honolulu, San Diego, and Mayport, while twenty-seven officers from the U.S. Navy were afforded the opportunity to tour the PLAN aircraft carrier Liaoning, which had been purchased from Russia in 2002 as the ex-Varyag.

Rising Tensions in the South China Sea

Ironically, the deepening levels of U.S. – China military cooperation have also been accompanied by deepening levels of competition – particularly in the South China Sea. As stated earlier, the decade of the 1990’s witnessed a race to stake out claims in the South China Sea and fortify them where possible.

That situation was temporarily stabilized by the Declaration on the Conduct of Parties in the South China Sea (DoC) in 2002, whereby the Association of Southeast Asian Nations (ASEAN) and China agreed on a ten-point code that included affirming their commitment to the United Nations Convention on the Law of the Sea (UNCLOS), the peaceful resolution of disputes without resorting to the threat or use of force, and:

…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.

The situation in the South China Sea remained relatively stable until 2009 when the deadline for submitting claims to the United Nations Commission on the Limits of the Continental Shelf (CLCS) arrived.  The CLCS prompted the six claimant states (China, Taiwan, Vietnam, Philippines, Malaysia, and Brunei) to file claims and counter-claims that significantly elevated tensions. In a note verbale in response to Vietnam’s CLCS filing, China reiterated its claim that:

China has indisputable sovereignty over the islands in the South China Sea and the adjacent waters, and enjoys sovereign rights and jurisdiction over the relevant waters as well as the seabed and subsoil thereof (see attached map).

China began acting aggressively to defend its claims in the South China Sea, including the dangerous harassment of the USNS Impeccable in international waters in 2009; the interdiction and expulsion of 147 foreign fishing boats from disputed waters in 2009; and the severing of towed cables of commercial seismic survey ships that were conducting hydrocarbon surveys within Vietnam’s Exclusive Economic Zone (EEZ) in 2011. The Global Times captured the spirit of this more assertive Chinese behavior in a September 29th, 2011 op-ed titled “Time to Teach Those Around the South China Sea a Lesson.” Tensions reached a new high between China and the Philippines in April of 2012 over fishing rights at Scarborough Shoal, which is located 470 nautical miles from the coast of China but only 125 nautical miles from the mainland archipelago of the Philippines – well within the Philippines’ 200 nautical mile EEZ.

After the Philippines dispatched Navy and Coast Guard ships to evict Chinese vessels that were unlawfully fishing within its EEZ, China responded by dispatching two China Marine Surveillance ships (equivalent to Coast Guard ships) that interposed themselves between the Filipino ships and Chinese fishing vessels. A negotiated settlement to defuse the crisis was violated by the Chinese in July of 2012, and China has maintained a continuous presence of Chinese Marine Surveillance vessels to scare off any non-Chinese fishing vessels ever since – in effect exercising de facto sovereignty through the use of force.  In March of 2014, tensions were further elevated when Chinese Coast Guard ships attempted to blockade the re-supply of the Filipino Marines stationed aboard the BRP Sierra Madre outpost on Second Thomas Shoal.  A Filipino supply vessel was ultimately able to sneak past the blockade, and the Philippines has also resorted to re-supplying the Marines on the outpost via air drops.

However, the most provocative and threatening Chinese actions in the South China Sea have been the execution of artificial island construction projects on the seven occupied maritime features (Cuarteron, Fiery Cross, Gaven, Hughes, Johnson, Mischief, and Subi Reefs) in the Spratlys beginning in 2014. While other claimant states such as Malaysia, Vietnam, and the Philippines have undertaken island-expansion projects in the South China Sea, they were of a small scale (approximately 115 acres over 45 years) and did not include airfield and port infrastructure for basing military ships and aircraft. In contrast, the Chinese have created more than 3,000 acres of land that includes airfields capable of basing tactical military aircraft on Fiery Cross, Mischief, and Subi reefs.  Additionally, the Chinese have dredged the harbor and built a pier on Subi Reef that is suitable for the largest PLAN vessels to moor, which enables future naval basing options.

During a news conference in Washington, DC in September of 2015, Chinese President Xi Jinping stated, “Relevant construction activities that China is undertaking in the Nansha [Spratly] islands do not target or impact any country and China does not intend to pursue militarization.”  However, the Washington Post revealed that China is building radar and communications infrastructure on all seven features in the Spratlys, including a possible High Frequency (HF) radar on Cuarteron Reef that would extend its maritime surveillance capability deep into the South China Sea. Additionally, given the fact that China has deployed J-11 fighter jets and two HQ-9 (derivative of Russian S-300) surface-to-air missile batteries on Woody Island in the Paracels as of January 2016, it is doubtful that China will refrain from deploying missiles, aircraft, and ships to the newly reclaimed features in the Spratlys.

On March 19, 2016, Reuters reported that the U.S. Navy had seen signs of Chinese maritime survey activity at Scarborough Shoal that could be a pre-cursor to commencing the construction of another artificial island. The case of Scarborough Shoal is unique in that no state has built any facilities on the exposed rocks, although the Chinese have exercised de facto maritime jurisdiction in the surrounding waters since 2012 as previously outlined.  This would be a game-changer in that the Chinese posture would transform from de facto maritime jurisdiction to physical occupation of a feature which lies only 125 nautical miles from the coast of the Philippines.

The Philippines’ initiation of arbitral proceedings in the Permanent Court of Arbitration (PCA) of the International Tribunal of the Law of the Sea (ITLOS) at The Hague in January 2013 and the Chinese reaction to it have also inflamed tensions in the South China Sea. The Philippines is seeking three distinct rulings in the case:

1. Declaration that the Parties respective rights in the South China Sea are governed by UNCLOS and that China’s claims based on “historic rights” with the “nine-dash line” are inconsistent with UNCLOS and therefore invalid.
2. Determination whether certain maritime features are characterized as islands, rocks, Low Tide Elevations (LTE’s), or submerged banks, which will subsequently clarify the maritime entitlements of those features and their impact on proximate features.
3. Declaration that China has violated UNCLOS by interfering with the exercise of Philippines’ rights and freedoms and through construction and fishing activities that have harmed the marine environment.

It is important to note that the PCA will not rule on the disputed sovereignty claims of the various maritime features in the South China Sea as that is beyond the scope of UNCLOS.

In a position paper issued in December 2014, China reiterated its policy position of “3 no’s” in regards to the Philippines’ filing: non-acceptance of the filing, no participation in the proceedings, and no implementation of any findings. The PCA ruled in October 2015 that it had jurisdiction and would consider seven of the Philippines’ submissions, prompting another round of sharp criticism from China in a note verbale to the UN. The PCA is expected to issue its findings in the summer of 2016, and possible outcomes of that ruling will be discussed below.

Assessing U.S. Strategy in the South China Sea

The U.S. response to Chinese expansion in the Spratlys is best characterized by the word “restraint.”  On the heels of the Mischief Reef seizure in 1994, the U.S. State Department pronounced in 1995 that the U.S.:

1. strongly opposes the use or threat of force to resolve competing claims and urges all claimants to exercise restraint and to avoid destabilizing actions,
2. has an abiding interest in the maintenance of peace and stability in the South China Sea,
3. has a fundamental interest in maintaining freedom of navigation in the South China Sea,
4. takes no position on the legal merits of the competing claims to sovereignty over the various islands, reefs, atolls, and cays in the South China Sea, and
5. …would view with serious concern any maritime claim or restriction on maritime activity in the South China Sea that was not consistent with international law, including the 1982 United Nations Convention on the Law of the Sea.

The U.S. has maintained this policy for the past twenty years.  

Any assessment of U.S. policy and strategy in the South China Sea must begin with an understanding of the ends. In a speech in July 2015, a senior U.S. State Department official summarized U.S. objectives in the South China Sea as:

• Protecting unimpeded freedom of navigation and overflight and other lawful uses of the sea by all, not just the U.S. Navy
• Honoring our alliance and security commitments, and retaining the full confidence of our partners and the region in the United States
• Aiding the development of effective regional institutions, including a unified ASEAN
• Promoting responsible marine environmental practices
• Fostering China’s peaceful rise in a manner that promotes economic growth and regional stability, including through consistency with international law and standards
• And more generally, an international order based on compliance with international law and the peaceful resolution of disputes without the threat or use of force

The U.S. record of achievement of those objectives has been mixed.

Freedom of navigation and overflight: The U.S. record of achievement of this objective has been mixed. The Chinese have not restricted the freedom of navigation & overflight of commercial vessels & aircraft transiting through the South China Sea. However, they have warned light civil aircraft that were transiting to and from the Philippine territory of Pagasa Island in the Spratlys. Additionally, this article has previously highlighted other examples of how the Chinese have denied other claimant states their rights to the lawful use of international waters in the South China Sea.  

The U.S. Navy has executed three maritime Freedom of Navigation Operations (FONOPS) in the South China Sea and countless aerial missions. In May 2015, a U.S. Navy P-8A “Poseidon” maritime patrol aircraft with a CNN television crew embarked was aggressively challenged eight times by “the Chinese Navy” to “go away” and “leave immediately to avoid misunderstanding” while conducting a surveillance mission in vicinity of reclaimed features in the Spratlys but clearly from the sanctuary of international airspace outside of twelve nautical miles of any territorial claims.  

The first maritime FONOP in vicinity of Subi Reef in the Spratlys on October 27, 2015 was heavily criticized for not being clear in its intent and prompted Senator John McCain to write a letter to Secretary of Defense Ashton Carter asking to clarify the purpose of the FONOP. In his response issued 56 days after the operation, Secretary Carter clarified that this FONOP “challenged attempts by claimants to restrict navigation rights and freedoms around features they claim, including policies by some claimants requiring prior permission or notification of transits within territorial seas.” The second maritime FONOP was executed on January 30th, 2016 in vicinity of Triton Island within the Paracels and accompanied by a Department of Defense press release that clearly stated its intent:

This operation challenged attempts by the three claimants, China, Taiwan and Vietnam, to restrict navigation rights and freedoms around the features they claim by policies that require prior permission or notification of transit within territorial seas. The excessive claims regarding Triton Island are inconsistent with international law as reflected in the Law of the Sea Convention.

A third maritime FONOP was executed in vicinity of Fiery Cross Reef on May 10th, 2016. In essence, all three of these FONOPS challenged the Chinese, Vietnamese, and Taiwanese demands for prior notification of entry of military ships into their Exclusive Economic Zone and territorial waters, which is in contravention of UNCLOS. Julian Ku pointed out that the second FONOP in vicinity of Triton Island received tacit support from Taiwan and Vietnam when each country released statements that did not condemn the U.S. for failing to provide prior notification, thereby isolating the Chinese as the only state to issue a condemnation.

However, using FONOPS to challenge prior notification requirements doesn’t address the root tensions in the South China Sea, which are the excessive Chinese maritime claims and the UNCLOS legal status of the seven reclaimed features and their associated maritime entitlements in the South China Sea. Gregory Poling suggested that an innocent passage to challenge the prior notification requirement was “low hanging fruit” and that executing a high seas transit regime within twelve nautical of a reclaimed feature that was formerly a low tide elevation – for example, Mischief Reef – would get at the heart of the matter, which is excessive Chinese maritime claims.

The U.S. could increase the impact of FONOPS by modifying two current practices. The first is the “pre-announcement” of intent to conduct FONOPS; this was done ostensibly to forewarn the Chinese and reduce the risk of escalation, but insidiously reduced the assertive effect of the freedom to “fly, sail and operate wherever international law allows” as Secretary Carter has proclaimed in numerous public fora.  The second is preserving some strategic ambiguity in its post-execution press releases. If the U.S. were to be ambiguous as to the purpose of the FONOP, the Chinese would have to guess which claims were being challenged and forced to clarify the nature of their claims.  

Honoring Alliances & Security Commitments: The U.S. has succeeded in strengthening its alliances and partnerships in the South China Sea region. It has recently negotiated an Expanded Defense Cooperation Agreement (EDCA) with the Philippines that will enable further security cooperation assistance and basing rights. The U.S. has also announced a Comprehensive Partnership with Vietnam (2013) and Malaysia (2014), a Joint Statement on Comprehensive Defense Cooperation Agreement with Indonesia, an enhanced basing agreement with Singapore, and continued to sell arms to Taiwan in accordance with the provisions of the Taiwan Relations Act of 1979.

The U.S. has also succeeded in strengthening its relationships with regional institutions like ASEAN, including hosting the annual US-ASEAN Summit in the United States for the first time in February of 2016.

Promotion of responsible marine environmental practices: The U.S. has clearly failed to achieve this objective. The construction of the seven features in the Spratlys has been labeled “the quickest rate of permanent loss of coral reef area in human history” with a claim that “a substantial amount of this damage is irrecoverable and irreplaceable.” It will take some time for marine biologists to assess the damage to the regional marine ecosystem due to the loss of coral and shallow water habitat.  

Compliance with international law and the peaceful resolution of disputes: The U.S. has also failed to bring Chinese behavior into accord with UNCLOS. The majority of legal scholars seem to have arrived at the conclusion that China’s maritime claims do not conform to UNCLOS. Additionally, the Chinese denial of claimant rights to the lawful use of the sea and their refusal to submit to arbitration of their territorial disputes are also in contravention of UNCLOS. Finally, while the Chinese have not used lethal military force in the enforcement of their claims, vessels from the China Marine Surveillance and China Coast Guard have used a variety of coercive, non-lethal techniques such as water cannons, shouldering, and ramming. The ruling of the PCA will present the U.S. and regional allies and partners with an opportunity to strengthen the principle of adherence to the rule of international law, no matter the outcome.

U.S. Policy & Strategy Options for the Future

Looking towards the future, the United States has essentially three broad policy options for the South China Sea: 1) “Continued concession” to Chinese sovereignty claims & further expansion in the South China Sea in an effort to preserve Chinese cooperation on broader regional and global issues, 2) “freeze” the status quo, or 3) “roll back” Chinese expansion & excessive sovereignty claims.

Option 1:  “Continued Concession”

This policy option can be described as a continuance of the current policy of the U.S., which has been justified by the argument that the South China Sea is not the central issue in the U.S.-Chinese relationship and that the benefits of curtailing Chinese expansion in the South China are not worth the costs of losing Chinese cooperation on other U.S. interests including the Iran nuclear deal, the de-nuclearization of North Korea, global nuclear non-proliferation, climate change, cyber-security and theft, intellectual property rights, fair trade, equitable monetary policy, and peaceful relations with Taiwan. Advocates of this policy option would also point out that the credibility of Chinese President Xi Jinping and his Communist Party leaders is under tremendous domestic pressure as Chinese economic growth is slowing and the Chinese stock market is plummeting, and therefore it wouldn’t be prudent to provoke a confrontation in the South China Sea that sparks an ultra-nationalist outburst from China. From a military perspective, the militarization of the seven features in the South China Sea do not fundamentally alter China’s anti-access/area-denial (A2/AD) strategy, because in the event of armed conflict between the U.S. and China, the islands are indefensible and could be neutralized quickly.    

The U.S. strategy for achieving this policy could consist of the following diplomatic and military ways and means:

  Diplomatic:

• Continue to warn against the militarization of the reclaimed features in the Spratlys
• Make relatively weak diplomatic statements against the Chinese rejection of any results of the PCA
• Encourage bi-lateral negotiations to resolve the disputes over maritime and sovereignty claims
• Continue to invest in multi-lateral institutions and relationships – and include China in their design
• Emphasize the benefits of continued Chinese cooperation on broader issues in the U.S.-Chinese relationship

  Military:   

• Continue maritime and aerial FONOPS that challenge the requirement for prior notification of entry into territorial seas and EEZ’s, but do not challenge Chinese maritime claims. Take no risk of actual confrontation – back off if it appears that the Chinese are willing to risk escalation
• Continue to execute multi-lateral security cooperation exercises, and encourage Chinese participation (i.e. RIMPAC 2016)
• Continue to provide security cooperation assistance to treaty allies to maintain the status quo

The downside of this policy option is that it will continue to deliver mixed results on the U.S. stated policy objectives for the South China Sea as depicted above. It will also continue to weaken the U.S. time-honored principle of adherence to the rule of law. Any bi-lateral negotiations will start with the Chinese in a position of strength and will only reinforce the realist notion that “might makes right” in international relations. It will not compel China to curtail its claims and activities that are in contravention of UNCLOS. Additionally, it will not reassure jittery allies and partners in the region that their interests are protected against further Chinese expansion.  Claimant states will be left to ponder, “Where next?” Dredging sand and coral to stake out a claim and militarize Scarborough Shoal?  Seizing Second Thomas Shoal from the squad of Filipino Marines that are guarding the claim? Evicting the Taiwanese from Itu Aba? Annexing and beginning artificial island construction activities on Malaysia’s Swallow Reef or James Shoal to extend China’s operational reach further south? While the notion of each of those Chinese actions may seem far-fetched, nobody anticipated in 2012 that the Chinese would execute a massive artificial island construction operation that would generate more than 3,000 square kilometers in the Spratlys by the end of 2015.

Option 2:  “Freeze the Status Quo”

This policy option is best described as an “all stop” order that freezes the status quo pending the ruling of the PCA. Alternately, this policy option could also be executed after the PCA ruling.  This option could colloquially be described as “possession is nine tenths of the law,” or, “if you occupy it today, you own it.” This option acknowledges that the Chinese have presented the region with a fait accompli for the seven reclaimed features in the Spratlys, and the best case outcome is to freeze it through balancing.

Under this policy, for example, China would keep for the time being the seven features it has reclaimed in the Spratlys and all of the Paracels; the Philippines would be granted sovereignty over Pagasa, Lawak, Parola, Likas, and Patag Reefs; Taiwan would be granted sovereignty over Itu Aba; Vietnam would be granted Great Discovery Reef, London Reef, Pearson Reef, and Pigeon Reef, etc. This policy would accept the transgressions of the past, but attempt to strengthen the rules-based order going forward – accompanied by credible military power to preserve that order.

The strategy for achieving this policy could consist of the following diplomatic and military elements:

  Diplomatic:

• Continue to warn against the militarization of any features in the South China Sea
• Affirm the PCA’s jurisdiction and the obligations of all parties to implement its findings
• Encourage any further disputes to be resolved through ITLOS
• Emphasize the “win-win” nature of this policy in that all claimant states retain their current possessions
• Threaten to curtail cooperation on regional issues and impose economic sanctions in the event of any Chinese attempts to change the status quo
• Declare unequivocally that any Filipino military personnel are covered under Article V of the Philippines Mutual Defense Treaty, including personnel stationed on any feature in the South China Sea

  Military:   

• Continue maritime and aerial FONOPS that continue to challenge the requirement for prior notification and assert freedom of navigation outside of twelve nautical miles of any maritime feature that is deemed to be an island or a rock under UNCLOS
• Encourage multi-lateral, non-claimant state participation in FONOPS, including the Japanese, South Koreans, and Australians to emphasize regional commitment to the peaceful resolution of disputes and stability
• Threaten to curtail Chinese participation in multi-lateral security cooperation exercises, including RIMPAC 2016, in the event of any further Chinese expansion
• Increase security cooperation assistance to treaty allies and partner claimant states – particularly in their naval and coast guard forces through foreign military sales and training
• Discourage all claimant states to avoid deploying military forces on any maritime feature

• Defend against any attacks or aggression by the Chinese with gradual escalation of the use of force

The downside of this policy option is that it would be difficult to execute without triggering another frenzy of artificial island construction and occupation prior to its implementation date. It would require negotiation between China and other claimant states, and China has demonstrated a propensity to use prolonged negotiations as a cover for achieving its desired policy objectives while the negotiations are taking place. This option also leaves open the question of those features that are disputed but not occupied, like Scarborough Shoal for example. Additionally, even if successfully implemented, as Greg Poling opined, “the status quo is now inherently unstable. A new round of escalation is always just over the horizon.”

Option 3:  “Roll Back”

I will start by stating that this option does not include the destruction or forcible eviction of Chinese forces that are occupying the seven reclaimed features in the Spratlys or any of the features in the Paracels. The Chinese have invested too much money and national pride and prestige in those seven features to evict them without the risk of starting a broader conflict.  

However, there are options to roll back other excessive Chinese maritime claims and prevent further territorial expansions with acceptable levels of risk. The triggers for this policy could be a ruling by the PCA that: 1) the Chinese nine-dash line maritime claim is not in accordance with UNCLOS and therefore null and void; or 2) maritime features that were formerly LTE’s prior to their artificial construction (Fiery Cross, Gaven, Mischief, and Subi Reefs) are not entitled to twelve nautical mile territorial seas but rather only a 500 meter safety zone; or 3) upholds the Philippines’ sovereign rights within a 200 nautical mile EEZ claim from their archipelagic baselines.

Each of these rulings generates roll-back sub-options that are independent of the others and could be exercised alone or in combination depending upon the totality of the PCA ruling.

If the nine-dash line claim is ruled to be void, it would immediately clarify that any waters outside of the 200 nautical mile EEZ’s generated from coastal baselines or 12 nautical miles from any features which have been identified as rocks under Article 121 of UNCLOS are fully international waters, whereby each state enjoys lawful fishing and seabed exploration rights including hydrocarbon extraction.  

If the PCA rules that the formerly LTE features do not have territorial seas, then that sub-policy option is clear: all states enjoy freedom of navigation and lawful use of the sea up to the point of a 500 meter safety zone.

In their arbitration filing, the Filipinos specifically requested that the PCA clarify the status of Scarborough Shoal and its surrounding maritime claims. It is likely that the PCA will rule that Scarborough Shoal is a “rock” entitled to a 12 nautical mile territorial sea, but since UNCLOS does not cover territorial sovereignty disputes, the maritime jurisdiction of that territorial sea will be left undetermined – unless the PCA affirms the Filipino claim to historic fishing rights around and within the Shoal.

There is a significant obstacle to executing any of these policy sub-options – the Chinese have gone on record stating they will not accept the results of the PCA nor the implementation of any PCA decisions. This will require a concerted diplomatic effort to deftly navigate, including both regional and global diplomatic efforts.  

Diplomatic:

• Affirm the PCA’s jurisdiction and the obligations of all parties to implement its rulings
• Build international diplomatic consensus to compel China into accepting the implementation of the PCA rulings
• Threaten to impose U.S. economic sanctions if China does not accept the implementation of the PCA rulings – similar to what the U.S. did on the eve of the U.S.-China Summit in September 2015 regarding Chinese cooperation on cyber-security and cyber-theft
• Curtail cooperation on regional issues if China refuses to implement the PCA rulings
• Continue to denounce the militarization of any maritime features in the South China Sea
• Make the case that Scarborough Shoal is “different” and make it clear that the U.S. will not accept Chinese construction of an artificial island on the Shoal
• Accept the fact that this option will induce “moderate friction” in the broader U.S.-China relationship

  Military:   

• Execute maritime and aerial FONOPS that affirm the PCA rulings, including high seas transit within twelve nautical miles of any maritime feature that is ruled to be a LTE – regardless of sovereignty claims
• Encourage multi-lateral participation in FONOPS, including by the Japanese, South Koreans, and Australians
• Terminate Chinese participation in multi-lateral security cooperation exercises, including RIMPAC 2016, if China refuses to implement the PCA rulings
• If the PCA affirms Filipino “historic fishing rights” at Scarborough Shoal, then the U.S. and regional Allies should establish a coast guard and naval presence to assist the Filipinos in restoring those rights, including, if necessary, gradually increasing military pressure on Chinese vessels operating in violation of the ruling
• Increase security cooperation assistance to treaty allies and claimant state partners – particularly by bolstering their naval and coast guard forces with foreign military sales and training

The downside of this policy option is that it would elevate the amount of strategic risk in the U.S-Chinese relationship. The U.S. and its allies and partners would have to closely monitor Chinese reactions to each of the ways and means listed above to avoid sparking a broader conflict.  However, failing to fully implement the rulings of the PCA would undermine the credibility of the ITLOS, UNCLOS, and the broader principle of applying international law to peacefully resolve disputes.  

Summary

The Chinese campaign to construct seven artificial islands in the Spratly Island chain in the South China Sea has inexorably changed “the facts on the ground” in the region in the span of just three years.  The ruling of the Permanent Court of Arbitration will likely overrule many of the excessive Chinese claims in the South China Sea, including those claims that are derived from these artificial islands.  The U.S. and its regional allies and partners will face a series of tough policy & strategy choices in the face of almost certain Chinese refusal to implement the arbitral rulings. Which of the three broad policy options the U.S. chooses (continued concession, status quo, or roll back) will become apparent by key observables in U.S. behavior.  

The key observables in the U.S. diplomatic realm will be the degree of inclusion or isolation of China in regional institutions and consultations, and the threat of using military and non-military tools of statecraft such as economic sanctions to attempt to compel the Chinese to adhere to international law and the principle of the peaceful resolution of disputes.

The key observables in the U.S. military realm will be the continued inclusion of China in multi-lateral security exercises such as RIMPAC, and whether or not U.S. and allied military operations challenge excessive Chinese maritime claims such as twelve nautical mile territorial sea claims around maritime features that were formerly LTE’s.

These three options have been presented in order of ascending strategic risk of conflict with China, but also in ascending degree of compliance with the principle of adherence to international law. U.S. policy makers will have to decide how much risk they are willing to accept in the South China Sea to achieve their broader strategic interests, which includes not only the broader strategic relationship with China but also the foundational principle of adherence to the rule of law upon which the post-World War II international system is built.

JPR Status: Working Paper

Archived: 6/28/16