Chinese interchange with Southeast Asia featured President Hu Jintao’s visit to Cambodia. The unusual attention was related to China’s efforts to manage disputes with claimants in the South China Sea and Cambodia’s appointment as the chair of ASEAN. Playing host at the Boao International Forum, Vice Premier Li Kejiang supported Hu’s emphasis on managing disputes diplomatically. Chinese leaders also endeavored to solidify relations with officials from several regional governments, emphasizing the importance of growing economic ties. Chinese commentary generally supported China’s South China Sea claims in carefully measured terms, though a widely publicized faceoff between Chinese and Philippine ships over fishing rights in a disputed area was accompanied by strong warnings to the Philippines as well as Vietnam, and repeated charges against the US along with accusations against Russia and India.

Chinese interchange with Southeast Asia featured President Hu Jintao’s visit to Cambodia beginning on March 29, displaying positive diplomacy laced with economic incentives. The unusual high-level attention to Cambodia was related to China’s efforts to manage disputes with Southeast Asian claimants in the South China Sea and Cambodia’s appointment as the chair of ASEAN. Hu left the country on April 2 with the reassurance that Cambodia would follow China’s preference and keep the South China Sea issue off the official agenda of an ASEAN Summit convening in Phnom Penh on April 3 and at other ASEAN gatherings later in the year.

Playing host at the annual Boao International Forum in April, Vice Premier Li Kejiang in a meeting with Vietnamese Deputy Prime Minister Hoang Trung Hai supported Hu’s emphasis in Cambodia on China and the Southeast Asian claimants managing their disputes diplomatically. The joint statement on Hu’s visit to Cambodia and other Chinese commentary emphasized abiding by the Declaration on the Conduct of the Parties in the South China Sea (DOC) and seeking full implementation of the declaration. President Hu, Premier Wen Jiabao, Vice Premier Li, and other top Chinese leaders endeavored to solidify Chinese relations during meetings in China with senior officials from several regional governments, emphasizing in particular the mutual importance of growing economic ties.

Chinese commentary generally supported China’s South China Sea claims in carefully measured terms, though a widely publicized faceoff in April between Chinese and Philippine government ships over fishing rights in a disputed area of the South China Sea was accompanied by strong Chinese warnings to the Philippines as well as Vietnam, and repeated charges against the United States along with accusations against Russia and India.

Special attention to Cambodia

President Hu’s prolonged stay in Cambodia was remarkable on several counts. As he did during preparations for the 17^th Chinese Communist Party (CCP) Congress five years ago, Hu restricted his foreign travel in 2012, presumably in part to focus on the complicated work of leadership succession at the 18^th CCP Congress later this year. Meanwhile, the succession process became more complicated with the removal of prominent Party leader Bo Xilai from his post in March.

Despite reports of leadership maneuvering and divisions in China over Bo Xilai’s removal, Hu departed Beijing on March 25 for his first trip abroad in 2012. He participated in the second Nuclear Security Summit in Seoul on March 26-28. He then visited New Delhi on March 28-29 for the fourth meeting of the leaders of the BRICS (Brazil, Russia, India, China, and South Africa) before arriving in Phnom Penh on March 29. The visits to Seoul and New Delhi involved numerous tightly scheduled bilateral and multilateral meetings that required Hu’s attendance as China’s head of state. By contrast, no Chinese head of state had visited Cambodia in 12 years. Hu’s visit to the country followed a leisurely pace that included individual meetings with most senior Cambodian leaders and careful attention to nurturing already close bilateral relations.

Officials highlighted China’s leading role in support of Cambodia’s economic development. Bilateral trade grew in value from $1.44 billion in 2010 to $2.49 billion in 2011. President Hu and Prime Minister Hun Sen pledged to double the value of trade to $5 billion in five years. According to Cambodian data, China is the largest foreign investor in Cambodia; at the end of 2011 there were 317 projects supported by China in the country with a value of $8.9 billion. The projects included hydroelectric dams and coal-fired power plants.

On the sensitive issue of the South China Sea, China Daily on March 31 cited the Cambodian ambassador to China for the observation that “Cambodia, as chair country for the ASEAN meetings, will help coordinate ties between China and other ASEAN countries,” and will urge involved ASEAN countries to not let the South China Sea issues affect bilateral ties. A Reuters dispatch that day cited Cambodian officials reporting on meetings between President Hu and Prime Minister Hun Sen for the news that Hu had asked Cambodia as ASEAN chair not to “push” the South China Sea issue and was told that Cambodia shares China’s belief that the issue should not be “internationalized.” Various news reports disclosed that Cambodia would endeavor to keep the South China Sea disputes off the official agenda for ASEAN meetings, though other ASEAN countries would likely raise the issue on their own initiative.

Leadership diplomacy

President Hu hosted Indonesian President Susilo Bambang Yudhoyono in Beijing in late March. The visit featured trade agreements worth $17 billion, a pledge to boost bilateral trade from $60 billion in 2011 to $80 billion in 2015, and promotion of closer defense cooperation and other ties under the rubric of the strategic partnership between the two countries. Official Chinese media indicated that China was pursuing better relations with Indonesia and other Southeast Asian states as a means to deal with territorial disputes in the South China Sea and the increased US presence in the region. Indonesia’s defense minister visited Beijing in February and was received by Vice Premier Li Kejiang.

Premier Wen Jiabao on April 1 met Malaysian Prime Minister Najib Razak in the southern Chinese city of Nanning, where the two leaders launched what Chinese media called “the first government-to-government mega industrial park” between the two countries. Chinese commentary equated the park to two Sino-Singapore industrial parks previously established in China. The park had been proposed by Premier Wen during a visit to Malaysia in 2011. Chinese media said the park added to strong Chinese-Malaysian economic ties, which had an annual trade value of over $90 billion, with China being Malaysia’s biggest trading partner and Malaysia being China’s largest trading partner among the ASEAN countries.

President Hu, Premier Wen, National People’s Congress Chairman Wu Bangguo, and Vice President Xi Jinping had separate cordial meetings with Thailand’s Prime Minister Yingluck Shinawatra on her first visit to China on April 17-19. According to official Chinese media, the visit advanced the status of China-Thailand relations to that of a “comprehensive strategic cooperation partnership.” The two sides signed a new joint action plan for strategic cooperation as well as a five-year plan for economic and trade development. They pledged to advance trade rapidly from the $64 billion in 2011; China is Thailand’s second largest trading partner. Hu Jintao pledged to further deepen mutually beneficial cooperation between China and ASEAN countries, and Yingluck said Thailand is willing to contribute more to promote ASEAN-China relations and work with China to maintain regional peace, stability, and development.

In mid-April, Vice President Xi Jinping met Do Ba Ty, chief of staff of Vietnam’s armed forces, in Beijing. Chinese media reported that Ty met counterpart Chen Bingde, who emphasized that Vietnam and China should “properly handle disputes” between the two countries.

Vice Premier Li Kejiang emphasized the positive with Singapore in February when he met Singapore Foreign Minister K. Shanmugam on his first visit to China. Chinese media emphasized the continued growth of economic ties, including trade valued at $80 billion in 2011. They highlighted Shanmugam’s warning in Washington prior to his visit to China that the US should not allow anti-China rhetoric during US election campaigns to spark unintended negative reactions in the region. China Daily also reported without explicit comment on Singapore’s participation in a US-led military exercise at a time of what it labeled as increasing US military presence and “increasing competition with China” in the region.

In a meeting on April 4, Vice Premier Li capped the visit of New Zealand’s foreign minister to Beijing to mark the 40^th anniversary of official relations between New Zealand and China. Describing ties as the “best ever,” Chinese commentary forecast growth in trade from $10.5 billion in 2011 to $17 billion in 2015, and noted that China was the largest source of foreign students in New Zealand and the fastest growing source of foreign visitors.

South China Sea disputes – status and outlook

Chinese commentary and actions

In contrast with the assertive Chinese posture that prevailed from 2009 into 2011 concerning the South China Sea, Chinese statements and practices continued the more moderate and measured approach to such controversies evident at the end of 2011 [See “Setback in Bali, Challenges All Around,” Comparative Connections 13:3 (January 2012)]. The low-key Chinese posture on the South China Sea seen during President Hu’s visit to Cambodia reinforced positive Chinese media coverage of talks in Beijing in January among China and ASEAN members on finding “practical ways” to promote cooperation as the parties implement the Declaration on the Conduct of the Parties in the South China Sea (DOC) of 2002. The parties reached an agreement in July 2011 on the guidelines for the implementation of the DOC, paving the way for its further implementation, according to China Daily. At the same time, there were few signs of compromise and some signs of Chinese determination and resolve over sensitive areas in dispute.

• Chinese media commentary in mid-March hailed expanded maritime surveillance with ships and planes that detected “illegal” oil and gas exploration, marine surveillance, military reconnaissance, and use of Chinese claimed islands in the South China Sea. Thirty “illegal” exploration platforms were reportedly found in the South China Sea.

• A multi-agency working group was reported in March to be in the midst of a geographical survey of the South China Sea. Global Times quoted noted specialist Zhang Yunlin for the view that “by drawing a map, the country can reinforce its jurisdiction claim to the South China Sea, and further actions may follow, such as exploiting resources near the Nansha (Spratly) Islands.”

• The head of China National Offshore Oil Corporation (CNOOC) told the media in Beijing in March that his company was expanding deep sea oil and gas exploitation in the South China Sea in cooperation with companies from developed countries and that CNOOC also was preparing to begin operations in the South China Sea using the company’s newly acquired deepwater rig that can operate at depths below 3,000 meters.

• A former Chinese tourism official told China Daily in March that a government plan would develop tourism on the Xisha (Paracel) Islands as a means to advance tourism while “safeguarding sovereignty over these islands.”

Criticism involving the United States, Vietnam, and the Philippines: January-March 2012

During the first three months of 2012, Chinese media and officials continued measured criticism of US “interference” in the South China Sea as part of the ongoing criticism of enhanced US engagement in the Asia-Pacific region. Chinese commentators took aim at US involvement in the South China Sea as part of their criticism of President Obama’s strategic guidance on defense released in January. The Chinese Foreign Ministry spokesman criticized US Pacific Command (USPACOM) Commander Adm. Robert Willard for remarks to a US Senate committee in late February regarding what Willard depicted as China’s less confrontational but still “aggressive” actions in defense of Chinese claims in the South China Sea. A China Daily editorial in March targeted Lt. Gen. Burton Field, the commander of US forces in Japan, for remarks to the media seen as demanding that China respect freedom of navigation in the South China Sea.

Among the public disputes between Vietnam and China in 2012, Vietnam’s Foreign Ministry spokesperson on Feb. 23 criticized Chinese transportation, tourism, and research activities in the Paracel Islands as inconsistent with the agreement between China and Vietnam on principles guiding the settlement of sea-related issues signed in 2011 as well as the DOC of 2002. On Feb. 28, deputy foreign ministers of Vietnam and China met in Beijing and reached agreement on various issues including steps to establish working groups to deal with some issues involving the 2011 agreement on sea disputes.

Vietnam’s Foreign Ministry spokesperson said in mid-March that China had violated Vietnam’s sovereignty by allowing a Chinese oil company to bid for oil exploration near the Paracel Islands. Also in March, the Chinese and Vietnamese Foreign Ministry spokespersons exchanged criticisms over China’s detention of 21 Vietnamese on the charge of illegal fishing near the Paracel Islands. Xinhua reported that the fishermen and two boats were released on April 20.

Regarding Chinese disputes with often vocal Philippine officials, the Chinese Foreign Ministry spokesperson in late February accused Manila of taking “illegal” actions in inviting foreign companies to explore for oil and gas in a region of the South China Sea claimed by China and the Philippines. China Daily followed with an editorial attacking “Manila’s Troublemaking.”  Philippine Foreign Minister Albert del Rosario rebuffed the Chinese charges. During 2012, del Rosario also continued efforts encouraging ASEAN to adopt a common position on South China Sea issues that would assist the Philippines in its disputes with China.

The Philippine government succeeded in January in gaining public support for its position on disputes with China from a US Senate delegation led by John McCain and Joseph Lieberman. The disclosure by the Philippine foreign minister in late January that the Philippine government was seeking more joint exercises with US forces and a greater number of US troops involved in such activities in the Philippines prompted the Chinese Foreign Ministry spokesman to advise against the move. An editorial in China Daily warned that the Philippine announcement sent the “wrong signal.” It was reported in March that Japanese Self-Defense Forces would join US and Philippine forces in exercises in the Philippines in March that also included military personnel from Vietnam and Singapore.

Heightened disputes; face-off with the Philippines; broadening criticism: April 2012

Chinese commentary on the results of the ASEAN Summit in Cambodia on April 3-4 noted the agreement to continue efforts on implementing the Declaration on the Conduct of the Parties in the South China Sea (DOC) indicated that “peacefully resolving disputes with China remains the common position among ASEAN members.” It took note of reported efforts by the Philippines and Vietnam to have ASEAN first arrive at a common position before negotiating with China on implementing the DOC, while Cambodia was said to favor China’s inclusion in the process. It applauded Hun Sen’s leadership, including his denial that China had pressured Cambodia to keep the South China Sea dispute off the agenda of the ASEAN Summit. People’s Daily advised on April 5 that the ASEAN Summit is not a suitable occasion for dealing with the South China Sea dispute, while the unofficial Global Times on April 9 published remarks by PLA Maj. Gen. Luo Yuan warning the Philippines against underestimating “the strength and willpower of China to defend its territorial integrity.”

By that time, a Chinese-Philippine crisis was underway over fishing rights in a disputed area of rock outcroppings 124 miles west of Luzon Island, the Philippines, known as Scarborough Shoal. Chinese fishing vessels were spotted by a Philippine plane on April 8; they were confronted by a Philippine warship on April 10 and searched by Philippine crew members. Two Chinese government maritime ships arrived to protect the Chinese fishing vessels and the face-off ensued amid repeated diplomatic protests. The protests subsided by the end of the week as the Philippine warship was withdrawn and replaced by a smaller Coast Guard vessel, and Philippine officials said the issue would be settled through diplomacy. The Chinese fishing vessels left the area.

Moving into the next week, two Chinese maritime surveillance ships and a Philippine Coast Guard vessel remained on the scene. The Chinese Foreign Ministry in protests on April 15 and April 17 pressed the Philippines to withdraw its ship from the disputed area. That week, the Philippines protested harassment of a Philippine archeological research boat in the South China Sea, and the Philippine foreign minister said the government would bring the territorial dispute with China before the International Tribunal on the Law of the Sea. The Chinese Foreign Ministry dismissed this maneuver. Philippine officials said a third Chinese government maritime surveillance ship entered the disputed area on April 20.

The last week of April was marked by reports from the Chinese Embassy in Manila that China withdrew two maritime surveillance ships and only one remained at Scarborough Shoal; the reports conflicted with Philippine officials claiming more Chinese ships were present and one had harassed Philippine Coast Guard boats in the area. Philippine President Benigno Aquino on April 24 acknowledged China’s refusal to cooperate with his government’s efforts to bring the issue of the disputed South China Sea territory before the International Tribunal of the Law of the Sea. He said that Manila would continue to publicize its claim and highlight China’s actions over the dispute as a negative example for other smaller neighboring countries as “maybe there will come a time that they will get the same treatment.” On April 30, Philippine fishing boats were reported working in Scarborough Shoal despite the controversy.

The China-Philippine dispute overlapped with the start of US-Philippine military exercises on April 16 involving mock beach invasions along Philippine coastlines facing China. President Aquino and other officials emphasized that the exercises had been planned “way, way ahead” of the current tension between China and the Philippines. Official Chinese commentary criticized the exercises, while more hawkish unofficial commentary in Global Times argued for retaliation with Chinese exercises in the South China Sea “close enough to put pressure on Manila.”

The coverage of the Chinese-Philippine standoff was accompanied by an uptick and broadening in Chinese criticism of others over South China Sea disputes. Official Chinese media in mid-April averred that tension was “rising” in the South China Sea, underlined Chinese determination to protect its interests against foreign encroachment and interference, and took aim at Russia as a Russian gas company reportedly reached an agreement with Vietnam for exploration in areas of the South China Sea. China Daily on April 11 cited Chinese government analyst Chu Hao for the observation that “the Kremlin” is supporting such moves as part of “the revitalization of Russia in East Asia.” The same dispatch criticized the Indian foreign minister’s remark earlier in the month that according to the dispatch indicated that the South China Sea “is the property of the world.” It went on to cite Chu Hao for the view that “India regards China as its biggest strategic rival in the region” and that the Indian foreign minister’s remarks could be seen as “a move to further heat up the disputes in order to contain China and prevent the country’s rise.” China Daily ran an editorial “Don’t play with fire,” on April 12 that sharply criticized the Philippines and Vietnam, highlighted the latter’s involving Russia in the South China Sea dispute, before finishing off with some criticism of Secretary of State Hillary Clinton.

Another small uptick came in criticism of Australia for hosting US Marines and reportedly considering US use of the Australian-controlled Cocos Islands in the Indian Ocean as a base for surveillance of the “South China Sea” and banning the Chinese company Huawei from contracts in Australia’s developing broadband system. A China Daily commentator on April 11 warned that Australia giving Chinese interests “the cold shoulder” with these kinds of actions will “hurt the good momentum that the two countries have worked hard to build.”

Uncertain outlook

Foreign experts have differed on how to interpret recent developments including the mix of controversy and calm that has prevailed in Chinese relations with Southeast Asian disputants and other concerned powers, notably the US, since 2011. Few see significant signs of compromise over territorial or resource claims, but China’s moderate and measured approach evident in President Hu’s visit to Cambodia and other leadership actions has prompted cautious optimism by some observers while others warn of trouble ahead.

Among the more optimistic, Massachusetts Institute of Technology Professor M. Taylor Fravel argued in Foreign Affairs and in testimony before the US Congress that the Chinese leadership has learned from the adverse reactions to China’s assertiveness over South China Sea issues in recent years. In response, it has reestablished a moderate approach since mid-2011 that emphasizes managing tensions, setting aside differences, pursuing common ground, and active and wherever possible cooperative diplomacy. He argued that the moderate approach was more in line with what he saw as China’s grand strategy, which requires cooperation with the US and China’s neighbors.

Carlyle Thayer of the University of New South Wales also judged in recent commentary in the East Asia Forum that China learned from the adverse reaction to “counterproductive” and “assertive” actions in the South China Sea. Also, ASEAN followed a pragmatic course to achieve progress in implementing the DOC and “diplomatic efforts produced a somewhat unexpected positive outcome” from what had been foreseen amid tensions earlier in the decade.

Australian scholar Leszek Buszynski writing in the Washington Quarterly reminded readers that whatever the strategies of China and its neighbors, the differences in the South China Sea have been enhanced by recent developments. Thus, the differences among China, Vietnam, the Philippines and other patriotic and nationalistic governments with claims over territorial and resource issues in the South China Sea have been magnified by these states’ growing need for and expanding efforts to develop and use  energy and fishery resources in the disputed regions of the South China Sea. Meanwhile, US involvement since 2010 has added a new set of differences and complications to calculations over the South China Sea.

Singapore Professor Li Mingjiang highlighted rising Chinese maritime aspirations evident during the deliberations at the National People Congress and the Chinese People Political Consultative Congress in Beijing during March. He viewed the aspirations as more likely than not to complicate and perhaps offset the current moderate direction of China’s approach to South China Sea issues. The proposals at the meetings involved the creation of a Chinese Coast Guard, the establishment of a maritime commission to coordinate the various agencies involved in Chinese maritime policy, and the use of China’s recently launched aircraft carrier to better protect Chinese maritime claims. Li said that the proposals were often accompanied with language claiming Chinese rights to “three million square kilometers of maritime territory,” which he judged would include the maritime zone of most of the South China Sea delineated by the nine-dashed line seen on Chinese maps used to buttress Chinese claims to the South China Sea. Li noted that these broad claims to the South China Sea are not officially endorsed by the Chinese Foreign Ministry, which said in a spokesman statement on Feb. 29 that “The core of the South China Sea dispute is the sovereignty disputes over some Spratly Islands and reefs and the demarcation of some maritime zones in the South China Sea. It is necessary to point out that no country, including China, makes a sovereignty claim over the whole South China Sea.”

Those questioning the sustainability of China’s moderate approach to South China Sea issues are supported by published analyses by foreign specialists with good access to Chinese foreign policy elites regarding the range of opinion among influential leaders and groups having a role in the making of Chinese foreign policy. The studies tend to stress the importance of advocates of strong nationalistic positions regarding Chinese territorial claims. The latest entry is an assessment in April 2012 by the International Crisis Group (ICG) that provides a map of the complicated array of Chinese institutions and authorities that play a significant role in the making of Chinese policies regarding the South China Sea. The ICG recounts recent efforts by Chinese leaders to ease tensions and moderate extremes in Chinese territorial claims, but forecasts uncertainty as more moderate Chinese authorities deal with a poorly organized and very complicated array of Chinese stakeholders, several with an interest in pursuing a tougher approach. Many Chinese specialists continue privately to confirm the findings of these studies, which suggest moderation on territorial disputes like the South China Sea may be difficult to sustain amid continued debate over the direction of Chinese foreign relations.

Also, Southeast Asian specialist Evelyn Goh argued repeatedly in the past year that China’s approach has emphasized the use of persuasion and inducement to get regional states to change their behavior in areas of concern to China, including over the South China Sea. In her view, such an approach has failed for China. For a time, China employed more coercion, but that proved counterproductive, resulting in the recent return to moderation amid a good deal of Chinese frustration.

Meanwhile, the debate over foreign policy in China does not always incline China to a harder line, according to Professor Lyle Goldstein at the US Naval War College. In an article in Contemporary Southeast Asia, he showed through close analysis of Chinese specialists’ debates over policy toward the South China Sea that there were strong voices for moderation in the Chinese Navy which provides an opening for greater cooperation with the United States.

Assessing the US side, Ian Storey of Singapore’s Institute of Southeast Asian Studies reviewed US military deployments in the Asia-Pacific related to the South China Sea in an editorial in The Straits Times. He listed a series of USPACOM worries over China’s growing power and a “rapidly closing” … “window of opportunity” to resolve South China Sea disputes peacefully.

Last but not least, there remains a well-established school of thought that sees a rising China on a path to dominate Asia and marginalize the U.S. influence in the region. Notably, Marvin Ott of Johns Hopkins University in a recent commentary depicted a complicated regional dynamic predicated on China’s perceived ambitions.

China-Myanmar relations

In light of the political reforms in Myanmar, China’s official position toward the country remains relatively unchanged.  China continues to welcome the positive developments in Myanmar and hopes to see strong momentum in the regime’s commitment toward national reconciliation.  After their meeting in Beijing in March, Chinese President Hu Jintao and Indonesian President Yudhoyono issued a joint statement that called for the international community to consider lifting economic sanctions on Myanmar, arguing that doing so would significantly contribute to its economic development.

It is unclear whether Beijing will ramp up its diplomatic and economic ties with Myanmar following Myanmar’s decision to improve ties with the United States, the European Union, and Japan. China-Myanmar relations faced some obstacles last September over Myanmar’s decision to suspend construction of a major Chinese hydroelectric dam on the Irrawaddy River.  The decision came after strong public outrage erupted in Myanmar over what was seen as China’s indifference and imperious attitude toward the people and environment of Myanmar.  According to a World Bank study, nearly 90 percent of the power generated by the dam would have been supplied to China’s Yunnan province, while less than 20 percent of households in Myanmar have electricity.  In spite of the suspension of the dam project, China retains the largest foreign economic presence in Myanmar; development of a deep sea port in the Bay of Bengal continues as do gas and oil pipeline projects.  The pipelines are projected to bring significant new revenue streams in terms of royalties and transit fees to the Myanmar government.

In February, China and Myanmar reaffirmed their ties when Jia Qinglin, chairperson of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), met Thura U Shwe Mann, Myanmar’s speaker of the House of Representatives, in Beijing.  In a high-profile visit, Thura U Shwe Mann also met Wu Bangguo, chairperson of the Standing Committee of the National People’s Congress, and Chen Bingde, chief of the General Staff of the PLA.  Both sides agreed to maintain high-level contacts, strengthen strategic coordination, and draw up a plan for comprehensive and strategic cooperation.  They also agreed to work together in areas of common interest, chief among them security and stability along the borders.

More turbulence ahead?

The pace of elite interchange, diplomacy and negotiation has picked up speed from the quiet winter months and appears likely to remain active, dealing with a widening array of issues involving the South China Sea. No party seems prepared to compromise its claims, and all have strong reasons to protect and develop the important resources seen to lie within their claims. Whether activism leads to confrontation will depend on a variety of determinants and trajectories involving a range of different national governments. Sustaining peace under these complicated circumstances remains difficult.