Sail carefully through the South China Sea dispute

A negotiated settlement of control of the South China Sea is the smartest solution to the dispute, writes Sholto Byrnes.

A Chinese bomber patrols the islands and reefs in the South China Sea. Liu Rui / Xinhua via AP

The ruling last week by the Permanent Court of Arbitration in The Hague on the disputed South China Sea could not have been more devastating for China. Its “nine dash line” that encloses about 80 per cent of the waters – and is the clearest statement of China’s claims – has “no legal basis”, ruled the court. China had illegally encroached upon the Philippines’ fishing grounds in the Scarborough Shoal and violated the country’s sovereign rights by constructing artificial islands. For good measure, China was also criticised for severely harming marine ecology by destroying coral reefs and failing to stop endangered species being harvested.

The reaction was swift. “China will never accept any claim or action based on those awards,” said the country’s president, Xi Jinping. Others were less measured. In the state-run news agency Xinhua, one writer declared: “The former Philippine government and the United States behind it have conspired for a long time to blackmail China regarding its historic rights to the South China Sea.”

Statements supporting the ruling were greeted with dismay. When Australia’s foreign minister, Julie Bishop, said that ignoring it “would be a serious international transgression”, a Chinese foreign ministry spokesman condemned her “wrong remarks” and accused her of treating international law as a game.

Top officials in the Philippines, which had brought the case in the first place, by contrast weighed their words extremely carefully. Perfecto Yasay, the foreign affairs minister, welcomed the ruling but also called for “restraint and sobriety”.

In China, despite the tough talk, last Sunday there was a large police presence stationed outside the Philippine embassy to discourage nationalist street demonstrations.

On the same day, a small number gathered in central Hanoi, to protest against China’s position on islands and seas claimed by Vietnam, were bussed away before they could even begin.

The fact is that it is in the interest of all parties that there is no sudden escalation that threatens the stability of the region, the shipping lanes through which 30 per cent of the world’s trade passes.

Malaysia’s foreign ministry insisted that “all relevant parties can peacefully resolve disputes by full respect for diplomatic and legal processes and relevant international law” – a formulation that keeps the peace because just about everyone can agree with it, while disagreeing on what is or isn’t “relevant international law”.

So what happens next?

Asean foreign ministers are meeting this week in Laos. At a recent Asean gathering in Kunming, China, a joint statement on the South China Sea was drafted and accidentally released before being withdrawn, apparently because the Chinese leant on Cambodia and Laos.

The 10-nation grouping appears unlikely to be able to apply much pressure in defence of its member states’ claims – especially when China is encouraging individual countries to discuss these issues on a bilateral basis, in direct contravention of the doctrine of “Asean centrality”, unity and consensus.

The United States, meanwhile, has been ramping up “freedom of navigation” patrols close to Chinese-occupied islands. But administration officials have privately admitted that there is no red line that would cause them to take military action. So long as China continues to increase its presence incrementally – the so called “salami slicing” approach – what is to stop them?

Little, appears to be the answer. But beyond the bellicose rhetoric, China has historically been pragmatic about its territorial claims. It has never given up what it considers its title to the north-east Indian state of Arunachal Pradesh, for instance, which it says was “unilaterally established” by India.

China calls it “South Tibet”; but while there may be occasional verbal skirmishes there is no suggestion they could lead to war. China adhered to the 99-year lease on Hong Kong, and agreed a “one country, two systems” approach to the former British colony’s governance which it had no legal requirement to do. Its patience with Taiwan, which it regards as a province with false pretensions to its own sovereignty, appears to be inexhaustible.

Perhaps, like the Vatican, China’s leadership thinks in centuries. What it cannot be expected to do is give up on a “core interest” such as the nine dash line, a maritime demarcation that has been taught in Chinese schools since the late 1940s and is now featured in the country’s passports.

Such “interests” are not up for negotiation, whether the rest of the world thinks they are justified or not.

Some kind of stable stalemate may be the best solution one can reasonably hope for, whereby joint development between China and the other claimants brings benefits to all sides, while none cede what they see as their legal rights. It would be complicated.

But if an acceptable de jure settlement cannot be reached – and it is hard to see how it could – a de facto one could, in the most optimistic scenario, and however difficult it would be to hammer out, lead to not just a cold peace but a fairly warm basis for the future.

After all, there are other claims between countries that are politically impossible for leaders to give up – that of the Philippines to a large chunk of the Malaysian state of Sabah, for instance, or that of Spain to Gibraltar. On the whole, however, they do not interfere with day-to-day reality.

A fudge, therefore, may be the best realistic outcome. But rulings such as last week’s run the risk of making compromise harder, by forcing the Chinese leadership to assuage the nationalist sentiment that they have, admittedly, some responsibility for whipping up.

“Restraint and sobriety” should indeed be the watchwords. Those hoping that international courts will issue verdicts that they know China can never accept should think twice. Such triumphs could turn so sour that the victors may wish they had never issued the challenge in the first place.

Sholto Byrnes is a senior fellow at the Institute of Strategic and International Studies, Malaysia