How the US Misjudged the South China Sea, Part II

By Xue Li and Xu Yanzhuo

August 05, 2016

http://thediplomat.com/2016/08/how-the-us-misjudged-the-south-china-sea-part-ii/

In Part I, we looked at U.S. actions and strategy in the South China Sea (SCS), and how U.S. policy so far has failed to achieve its desired result. The main reason for this is that U.S. strategy is based on a misunderstanding of China’s actions and goals in the SCS. In Part II, we examine China’s stance in the SCS and its response to U.S. actions.

After a series of tough approaches by the United States toward China, will China respond by further tightening control over the SCS (for example, by establishing an air defense identification zone)? By constructing massive military buildings on occupied reefs? By claiming a 200 nm exclusive economic zone (EEZ) around artificial reefs? Or by announcing that the nine-dash line is a maritime boundary and expelling the U.S. presence? It seems Washington must prevent these outcomes by all necessary means.

These questions are difficult; no one can promise these things won’t happen. Since foreign policy decisions are not always made on the basis of assured information, we will seek to answer these questions according to China’s foreign policy philosophy.

An Analysis of China’s Stance

We would argue President Xi Jinping’s personal experiences and his knowledge of China’s historical lessons determine that China must continue its peaceful rise. It is impossible for China to develop in a non-peaceful environment. Since the “reform and opening up” began close to 40 years ago, China’s rapid growth, together with a deep involvement in international society, have made the country a major beneficiary of the current system. Today, continuing this approach will further benefit China.

Additionally, in human history a rising power and established power have always escalated toward war — the so-called Thucydides Trap. Creating an alternative order not only is impossible to achieve through peaceful means, but would also be too unpredictable for China, and would definitely harm China’s development. Even if Beijing succeeded in establishing a China-dominated international system, it would be extremely difficult for China to maintain the current necessary growth within this framework. Practically speaking, it is better for China to maintain the existing international order than to take on the great risk and high cost of revising it. It is better for China to develop and achieve the “two centenary goals” within the current system. Beyond that, it is better to leave the more long-term questions for the next generation.

Moreover, China still has a large gap with the United States in many aspects; it is far behind challenging Washington’s dominant role. Although China has a history of being a hegemon for 2,000 years, it is a late comer to modern international society. In the future, China might overtake the U.S. in terms of GDP and national defense expenditures, yet in terms of comprehensive national power, science, technology, education, international influence, and military alliances, China is unable to catch up with or to serve as an alternative to the United States.

In short, China is unlikely to replace the United States’ dominant role worldwide. The Chinese government has a clear understanding of this. With this judgement in mind, it has taken the following steps. Domestically, it seeks to increase the legitimacy of the Communist Party of China (CPC), enhance governance capabilities, promote the establishment of a service-oriented government in order to maintain social stability, restructure the economy, promote sustainable development, and improve social welfare. Externally, it supports and maintains the existing international system and even dedicates China’s efforts to improving the system by creating functional mechanisms and enhancing the role of emerging economies. Take the Asian Infrastructure Investment Bank (AIIB) as an example — China has operated the bank in cooperation and collaboration with the existing global and regional programs.

Some analysts have implied that China has a secret plan to create a new international order by peaceful or non-peaceful means. Even though we can’t claim access to military secrets, based on China’s current military power and technology, it is impossible for China to pose an alternative to the United States when it comes to world security. While serving in the largest think tank in China, we have not found any information on, much less a program or plan to create, a China-centered international system.

Some analysts have argued that China’s supposed rejection of the current system is revealed in its response to the recent SCS arbitration case brought by the Philippines. It’s worth noting, however, that China is not opposed to international judicial and arbitration in general, yet it selectively accepts such measures — as do all other powers. The United States has not sent its disputes of Arctic waterways in North America with Canada to arbitration by a third party; it maintains the status quo while dealing with the disputes directly. In fact, the U.S. has not ratified UNCLOS because it is believed to be unfavorable to American interests, and the other four permanent Security Council members have all made exception declarations.

Most famously, Nicaragua instituted a case against the United States in the International Court of Justice due to Washington’s support for Contras in their rebellion against the Nicaraguan government, including the use of mines in Nicaragua’s harbors. The ICJ ruled clearly in favor of Nicaragua. The Reagan administration, however, refused to participate in the proceedings and argued that the Court did not have jurisdiction. Later, the U.S. withdrew from compulsory jurisdiction in 1986 and now accepts the Court’s jurisdiction only on a case-by-case basis. This is how the United States shows respect to international law.

An Analysis of China’s Activities

How then should we understand China’s recent activities in the SCS, particularly its large scale land reclamation in the Spratly Islands? Theoretically, there are two possible explanations. The first is that China wants to expand its holdings and is thus poised to take even more provocative steps; the second is that China merely wants to set up a proportional presence in the SCS so that it can negotiate the disputes on a reasonable basis. Researchers and military officials from ASEAN, the EU, Japan and the United States mainly focus on the first explanation. However, we would argue China is unlikely to take further actions — whether militarizing the SCS or declaring the nine-dash line a maritime boundary — because doing so would work against its interests.

First, the One Belt, One Road (OBOR) strategy is a top-level design introduced by the new government to guide its foreign relations. It will be the paramount strategy through Xi’s administration. And Sino-ASEAN relation is key to the 21st Century Maritime Silk Road.

China has always valued its relations with ASEAN. Since the 1990s, it has considered ASEAN as an important multilateral diplomatic platform. Xi’s government further prioritizes such peripheral diplomacy and has advocated for a China-ASEAN community of common destiny. This diplomatic emphasis means China’s SCS policy cannot undermine the overall agenda. It is said that ASEAN countries tend to rely on China economically, yet depend on the U.S. for national security. Viewed strictly in terms of trade volume, ASEAN countries may be dependent on China, yet regarding technology and value-added trade, ASEAN countries can hardly be said to rely on China. Meanwhile, the United States has strengthened its economic links with ASEAN through the Trans-Pacific Partnership (TPP). In this case, if China sought to militarize the SCS, it will definitely harm to China-ASEAN relationship and further to push these countries to side with the United States.

Second, Chinese officials have repeated the dual-use nature of facilities in the Spratly Islands; the few military facilities are deployed only for necessary defense. In fact, the deployment essentially is no different from what ASEAN claimants have done for years. Meanwhile, Xi and Foreign Minister Wang Yi have both warned the United States not to misjudge the situation in the SCS. Xi even clearly assured Obama that China will not militarize the SCS.

Third, the announcement of nine-dash line as maritime boundary would contradict the Convention on the High Seas ratified in 1958 as well as China’s declaration of territorial baselines in the Paracel Islands. Further, if China treated the nine-dash line as a maritime boundary, the navigation of hundred thousands of ships will be impeded, which would essentially mean that China is declaring itself against the world for very little benefits.

Finally, any of these actions would engender a fight against the United States in a situation where most of countries are siding with Washington.

In short, China’s land reclamation activities in the Spratly Islands were not done solely because the government has the capability; it was done because it was necessary. China’s capabilities in the SCS go far beyond the current scale of its actions; it is capable of greatly increasing the number of occupied maritime features, or of conducting reclamation on features other than the reefs it currently occupies. With this in mind, based on its power and presence, China’s current activities are very restrained.

Among all the claimants, China is the only state that has not explored any oil and gas in the waters near the Spratlys. Up until 2013, it was also the only country that had not conducted land reclamation. Since the Declaration on the Conduct of Parties in the South China Sea (DOC) was signed in 2002, ASEAN claimants have never stopped changing the status quo. Instead, they continued to explore new oil and gas fields, build new facilities, develop resettlement, or carry out land reclamation. They either responded negatively to China’s call for “joint development” or refused China’s proposals by denying the disputed areas or setting unreasonable conditions, such as demanding that China offer financial investment. China, Vietnam, and the Philippines finally agreed to conduct trilateral Joint Maritime Seismic Understanding (JMSU) in a disputed area from 2005 to 2008, but the plan fell through due to the Philippines’ domestic obstacles. The failure of cooperation taught Beijing that without a strong presence in the Spratly Islands, it is impossible to promote the resolution of the disputes.

Meanwhile, there is not any tangible joint development program among ASEAN claimants themselves in the overlapping area in the Spratly Islands, nor have the other claimants finalized mutual maritime demarcation. Their conflicts and disputes have merely been temporarily covered up with China’s.

China is not very ambitious in the SCS, nor does it seek to control the whole water through military means. Even though some Chinese analysis has suggested taking full control by claiming the nine-dash line as a maritime boundary line, the government is unlikely to follow this advice. Such an approach is not only incompatible with China’s long-term interests, but also harms China’s OBOR strategy and peripheral diplomacy. China chooses instead to take advantage of the resources in the SCS by maintaining peace and stability.

When it comes to the SCS, China is learning to become a great power and is searching to balance its national interests and a resolution acceptable to ASEAN claimants. The disputes are extremely complicated; clearly, introducing more and more external states will not simplify the problem. The practical way forward is to establish consensus, to share benefits in some functional aspects, and to narrow differences in this process. Therefore, China advocates promoting tangible cooperation under the DOC framework, and would like to provide financial, technical, and personnel support. Some analyses that concentrate on China’s tough activities ignore the insights of these actions (nor do they recognize China’s long-term restraint).

The Prospects of the Nine-Dash Line

Some believe that the nine-dash line will collapse under the U.S. “combo punches” explained in Part I. Even if China will not give up the claim, it will largely hurt China’s international reputation. Considering its loss, some analysts hope that China might give up the nine-dash line. Such a prediction does not fully understand Chinese traditions and contemporary political culture. European culture values honor and dignity; similarly Eastern culture emphasizes face and harmony, which are reflected in the the “ASEAN way.” Though the SCS is not China’s core interest, humiliating a rising power is not wise for a hegemon to do. Such a move might have consequences far beyond the SCS. China is unlikely to change its policy of “no first use” of nuclear weapons, but it is possible that China might abandon its minimum nuclear deterrence strategy. Imagine a China that possesses more than 1,000 intercontinental ballistic missiles — what consequences would that have?

The Philippines’ arbitration case will likely do only limited damage to China in the long run, yet it has caused high diplomatic pressure in the short term. After all, it was China’s first arbitral case in decades, which launched with U.S. support, no less. Apart from applying external diplomatic pressure, the United States also undermines China’s claims in the SCS through muscular patrols. These activities continuously humiliate China. The Chinese navy is stronger than the ASEAN countries’ navies combined, but it never threatened these countries in such a way. The Chinese government has already been pushed into a difficult situation. Further aggressive actions will only make it even harder for China to soften its policy, and will force Chinese government to react strongly.

U.S. Defense Secretary Ashton Carter is probably an old hand of George Kennan’s philosophy, but is he familiar with Confucius and Mohism? U.S. military activities in the SCS have harmed China in an unnecessary way and silenced the moderates’ voice in China, while stimulating Chinese nationalism. It creates tremendous internal and external pressure for Beijing, thus forcing the country to respond aggressively. In this case, it is inevitable for China to deploy military facilities and conduct military exercises in the SCS; otherwise, the government cannot dilute the increasing domestic nationalism. As Ouyang Yujing, director general of the Department of Boundary and Ocean Affairs of China’s Foreign Ministry, has said, the relationship between China and the United States is like a spring. The more pressure from U.S., the larger the rebound from China.

Even if it is hard to predict China’s future actions, consider the historical precedent. Since 1949, China has demarcated borders with 12 out of 14 neighboring countries. All of the concessions were made in line with a friendly bilateral relationship; none of the demarcations have been finished under great diplomatic pressure. Chinese traditional culture may explain this diplomatic philosophy of high dignity and low visibility. In terms of diplomacy, China tends to compromise in a good environment yet respond aggressively under high pressure. Moreover, China did not make any concessions when its comprehensive national power is much weaker; it is unlikely to compromise today. Additionally, Xi may be the strongest Chinese leader since Mao. Faced with U.S. pressure and humiliation, China would only choose to fight back.

Summary and Suggestions

Probably misinformed by a military focus and a lack of understanding of Chinese philosophy, the Obama administration misjudged in the SCS. “Combo punches” are only effective to a certain extent; overreacting and unnecessary pushing will have the opposite effect.

China is rebuilding its identity and interests, especially its maritime interests. China and the U.S. have common maritime interests. China’s maritime strategy mainly lies in cooperating with the U.S., jointly protecting global maritime security, and improving current maritime mechanisms. After all, the SCS is only part of the broader bilateral relationship.

The Obama administration has less than six months left to make a difference. It is necessary and possible for Obama to make more of an effort to dial down the disputes, such as instructing senior officials in the Pacific and Pentagon spokespeople to be cautious and responsible in their speeches. What’s more, as great powers, both China and the U.S. have a responsibility to communicate and negotiate in a more decent and mild way and to clarify misunderstandings. Only once the U.S. and China have found consensus can the tension in the SCS cool down.

Encouragingly, after the Philippines’ arbitration case concluded, it seems that China and the U.S. are indeed trying to cool down tensions. If this trend continues, a hopeful future for the SCS could become a diplomatic legacy for the Obama administration. If there is another return to strong words and muscular deeds, however, the U.S. approach will surely backfire.

Dr. Xue Li is Director of Department of International Strategy at the Institute of World Economics and Politics, Chinese Academy of Social Sciences. Xu Yanzhuo received her doctorate from Durham University (U.K.) in December 2014 and studies international responsibility, the South China Sea disputes, and Chinese foreign policy.