The Spratly Islands: A Threat To Asian Regional Stability

CSC 1995

SUBJECT AREA - Foreign Policy

EXECUTIVE SUMMARY

TITLE: The Spratly Islands: A Threat to Asian Regional Stability

AUTHOR: K. Scott Holder, Defense Intelligence Agency

THESIS: Will the Spratlys dispute spark the next great Asian war, is it in

part causing a regional arms race, and can the U.S. help solve

the problem.

BACKGROUND: The Spratly Islands are a contentious sovereignty dispute

involving almost all the littoral states of the South China Sea. The dispute is

complicated by hardline negotiation stances and the possibility that the area

contains significant gas and oil deposits. International law concepts

developed over the last decade have complicated the issue and fueled

activities to build outposts to further stake out claims. The Spratlys dispute

has been an important factor in the littoral states justifying additional military

spending and the dispute has significant security outcomes on states

without direct sovereignty claims. China is the key player in the dispute and

the most bellicose in its rhetoric and actions. The other claimants and

outside regional players have a distrust of long-term Chinese intentions

which is potentially fueling an arms race. The U.S. has little direct interest

but its continued military presence is viewed as vital to deterring an

aggressive China. Nonetheless, the U.S. probably cannot take an active

interventionist role, either diplomatically or militarily, unless directly invited to

do so by all the involved parties.

RECOMMENDATION: That the U.S. maintain its current military levels in

Asia, broadly engage China on security and economic issues in an effort to

influence Beijing in other foreign policy arenas, and work through established

Asian regional bodies to act as an honest broker and to ensure perceptions

over the Spratlys do not get out of hand.

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THE SPRATLY ISLANDS: A THREAT TO ASIAN REGIONAL STABILITY

INTRODUCTION

Until 1988, the area of the South China Sea known as the Spratly

Islands was one of the lesser known points of tension in Asia. On 14

March, 1988, Vietnamese soldiers confronted a Chinese survey team

working at one of the innumerable reefs in the archipelago. Chinese naval

vessels loitering nearby sank the assisting Vietnam transport ships.1 This

minor incident brought the world's attention to one of the most troublesome,

and to some, potentially destabilizing sovereignty issues in the Far East.

Until recently, the Spratlys main significance had been their serious

hazard to navigation. Their only value, aside from the location near several

primary shipping lanes, was limited to commercial fishing and guano

phosphate deposits. Formal diplomatic disputes over the area go back to a

1933 Chinese protest over France's unilateral annexation.2 The end of the

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1 "Visiting with Yang Zhiliang," Wen Wei Po (Hong Kong), 6 September 1988, p

2 Despite being a Vietnamese source, an excellent historical examination of

exploration in the South China Sea is found in "The Paracel and Spratly Archipelagos

and International Law" Hanoi VNA in English, 26 April 1988, pp 1-24.

America's withdraw from Southeast Asia left something of a power void which

allowed states like China and Vietnam to advance their interests without

potential outside intervention. Moreover, the negative impact of the first oil

embargo spurred the South China Sea littoral states to seek new petroleum

resources. A single geologic survey conducted in the mid 196Os in conjunction

with preliminary efforts to drill in regional coastal waters indicated there might

be oil in the Spratlys, hence the sudden interest.3

The South China Sea is bordered by states with a long history of endemic

conflict, strife, and of recurrent intervention by, and interplay with, non-regional

powers.4 During the last 25 years, six countries have laid claim to all or part

of the Spratlys: Brunei, China, Malaysia, Philippines, Taiwan, and Vietnam.

Their competing claims encompass political, economic, and strategic concerns,

and the dispute has emerged as the new flashpoint in post-Cold War Asia.

Furthermore, it has become the focus of growing regional concern about

Chinese expansion and provides to some, justification for continued U.S.

military presence in Asia.

This paper will analyze the premise of the Spratly's sparking the next

general Asian war, the role of each claimant, and who is the key to a peaceful

resolution of the dispute. It will also examine the effect this issue has on

____________________

3 Ruan Chongwu, "Hainan Provincial Secretary on Economic Development," Ta

Kung Pao (Hong Kong), 30 August 1993, p 6.

4 Ali Alatas, "Managing the Potentials of the South China Sea," The Indonesian

Quarterly, XVIII/2, p 112.

peaceful resolution of the dispute. It will also examine the effect this issue

has on countries without a specific sovereignty claim in the archipelago but,

nevertheless, have acute security interests in the South China Sea. It will

also discuss how international law has the potential to solve the problem

while at the same time be a contributing factor to heightening tensions.

Finally, this paper will look at the United States' role in helping resolve the

problem and its implications on our strategy in Asia over the next fifteen

years.

GEOGRAPHY5

The Spratly Islands encompass a group of more than 100 coral

islands, cays, reefs, and shallow banks scattered over a 100,000 square

mile area in the South China Sea. However, the combined total land area is

only about one square mile. The largest island, Itu Aba, is only 8 feet high

and measures 130Ox450 yards. Typically, the other islands are also low,

built up by an accumulation of sand, shingle, boulders, or reef debris on a

coral platform. Many reefs and cays emerge at only low tide. The forces of

accumulation and erosion are so great that the shape and size of the

formations varies significantly from season to season. The environment is

generally harsh, the water shallow, and unpredictable bottom changes make

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5 The information in the following section has been derived from: K. Wyrtki,

Physical Oceanography of the Southeast Asian Waters, California, Naga Expedition

Report No. 2, Scripps Inst. Oceanography, 1961; and Pub 161, Sailing Directions for

the South China Sea and Gulf of Thailand, 4th Edition, 1988, Defense Mapping

Agency, Hydrographic/Topographic Center, Washington D.C., pp 1-13.

the area hazardous for navigation.

The area is under the influence of a tropical monsoon climate,

probably the most important geographical factor inhibiting human activity.

Typhoons are a major hazard with the period of greatest danger occurring

from July through November. The more fragile facilities built on the shallow

reefs are susceptible to storm damage with evidence every year of repair

work. In fact, at least one naval ship and uncounted fishing vessels have

been lost in the Spratlys since 1983.

Fresh water exists only on Itu Aba and the outposts that dot the area

must be regularly resupplied.6 Summer temperatures regularly exceed 100

degrees and the military troops stationed there do little else but observe

shipping traffic and fishing boats. It is no suprise that most spend no more

than 3 months on station. Almost all naval surface activity halts after July

because of the typhoon threat although resupply missions occur year round

and are usually timed between typhoons. While scientific and commercial

activity follows this pattern, fishermen continually ply the waters.

RESOURCES & INTERESTS

The most important physical feature of the Spratlys is the possibility

of vast oil and natural gas deposits. Areas to the west, southwest, and

southeast of the Spratlys have an extensive array of active gas and oil rigs.

_________________

6 See Pub 161, Sailing Directions..., pp 1-13 for the geographical constraints;

resupply missions are conducted by naval cargo ships and are regularly noted in the

claimant's respective military press such as China's PLA Pictorial.

Preliminary geologic surveys done in the late 196Os indicated the Spratlys

have the POTENTIAL for hydrocarbon-based resources.7 As the surrounding

waters contain lucrative oil and gas deposits, countries have been eager to

definitively ascertain just what the Spratlys might hold. This unproven

resource potential is the main driving force behind the rush to stake claims

and assert control over the archipelago.

Aside from the question of gas and oil deposits, the Spratlys are

considered important because of their location in the South China Sea.

Major shipping lanes from the Far East to the Indian Ocean traverse the

Spratlys giving whoever controls them a significant advantage in threatening

these sea lines of communication. The sea lanes through the South China

Sea are important for energy transport plus regional and international trade;

they carry a heavy maritime traffic density. Any such closure would have an

immediate impact on states such as Japan and Thailand. That implies

countries which have no actual soveriegnty claims still retain significant

"interests" in the Spratly Islands.

SOVEREIGNTY CLAIMS

China (and Taiwan) have by far the most extensive claims and regard

the entire South China Sea as their "special preserve". The Chinese base

this on historical evidence of discovery and more recently developed

__________________

7 Ta Kung Pao (Hong Kong), 30 August 1993, p 6; the original survey was done

for the South Vietnamese government by an American firm.

regularly sent naval vessels to the area during the Ming Dynasty (14th-17th

Centuries).8 However, the Chinese did not physically occupy any location until

the Nationalists moved onto Itu Aba in 1946. In 1988, mainland China

established five outposts in the Spratlys and a sixth in March 1995. China's

1992 territorial sea law staked out an extreme negotiating position and

underscores the importance Beijing places on the Spratlys.9

Vietnam has probably been the most physically active in the archipelago

over the last 200 years. Hanoi bases its claim on continual presence, the

French colonial annexation of 1933, and its present continental shelf limits.

Since 1951, when Japan formally renounced its claim and administration of the

region under the San Fransisco Peace Treaty, Vietnam continually laid claim to

part of the Spratlys. The Hanoi and Saigon governments constructed military

outposts on several islands during the 1950s. The process accelerated during

the late 1980s so that Vietnam has around 30 occupied sites scattered over

much of the archipelago.

The Philippines' official claim dates from 1978 and covers a rectangular

area extending northeast to southwest. Manila based this decree on its

interpretation of the terra nullius principle of international law which maintains

that the Spratlys did not legally belong to anyone prior to Japan's occupation

______________

8 Hanoi VNA in English, 22 April 1988, pp 1-24.

9 Robert G. Sutter, East Asia: Disputed Islands and Offshore Claims. Issues for US

Policy, Washington Congressional Research Service, 1992, pp CRS-6-7.

and that the Philippines was merely occupying abandoned territory.10

Therefore, the Philippines could appropriate the area of Japanese occupation.

This statement was a fait accompli in 1978 since Manila had been quietly

building outposts in the northeast sector of the islands for ten years and

currently occupies eight sites.

Malaysia initially asserted its claim in 1982 and, like Vietnam, based it

on the country's continental shelf extension. By 1986, it occupied three sites

in the southern portion of the Spratlys. Brunei claims only one narrow area

within Malaysia's claim, also using the rationale of continental shelf extension.

INTERNATIONAL LAW AND PERCEPTION

Despite repeated assertions of "indisputable sovereignty" by all the

countries over their respective claims, no international agreement exists which

determines the lawful status of the Spratlys. The United States' policy is that

we have no position on the legal merits of the competing claims, see no

justification for the use of force, and urges the peaceful settlement of the

dispute by all the involved parties.11

The current problems in the Spratlys have been further compounded by

new development on sea laws.12 The 1982 UN Law of the Sea Convention

_____________

10 B.A. Hamzah, "Jurisdiction Issues and the Conflicting Claims in the Spratlys,"

The Indonesian Quarterly, XVIII/2, p 142.

11 Susumu Awanohara, "Washington's Priorities," Far Eastern Economic Review,

13 August 1992, p 18.

12 B.A. Hamzah, p 133.

The current problems in the Spratlys have been further compounded

by new development on sea laws.12 The 1982 UN Law of the Sea

Convention (UNCLOS) introduced new concepts such as the 200 nautical

mile exclusive economic zone (EEZ) off a country's coastline and redefined

the continental shelf. Therefore, a small speck of island in the middle of an

ocean becomes very important as it can expand a state's maritime

territory.13 Unilateral proclamations of ownership have led to "creeping

annexations" and the current heightened concern over the Spratlys is

precisely due to the actions of its rival claimants scrambling to occupy spots

in order to enhance their positions once UNCLOS becomes officially part of

international law. As of April 1995, two more countries need to ratify

UNCLOS before it becomes part of international law. Of the Spratlys rivals,

only the Philippines has ratified UNCLOS.14

UNCLOS provides for legal adjudication of disputes such as the

Spratlys. Furthermore, numerous bilateral agreements have been negotiated

worldwide concerning disputed maritime territory which indicates conflict

resolution is possible. For that matter, several of the Spratlys claimants

already have a number of maritime joint development arrangements in other

sea areas (e.g. Malaysia-Philippines, Malaysia-Vietnam, and Philippines-

___________

12 B.A. Hamzah, p 133.

13 Ibid., p 143.

14 Naval War College--Oceans Law and Policy Department, Maritime Claims

Reference Manual, Newport, Rhode Island, 1990 with yearly updates, p 2/352.

Vietnam) suggesting the political will exists to enter into such

agreements.16 However, because the Spratlys are a multilateral problem

and several parties have staked out hardline negotiating positions, no easy

answer exists. Vietnam and the Philippines have expressed interest in a

multinational approach to the Spratlys and would negotiate any sovereignty

issues.18 However, China and Malaysia prefer a series of bilateral

agreements with parties whose claims overlap their own. China is

particularly sensitive about sovereignty stating that it is a non-negotiable

issue but that Beijing favors "joint economic exploitation" with other

states.17 That is why the rival claimants are loathe to begin formal

negotiations with China since, in their minds, Beijing would see that as an

implicit recognition of its vast claim. Again, the competing states are

maneuvering for long term advantages if forced to defend their claims in a

legal world forum or while courting public opinion.

U.S. INVOLVEMENT

At face value, the Spratlys should not greatly involve the United

States. Nonetheless, an outright war over the Spratlys could provoke a

divisive domestic argument over its effect on regional stability and how that

________________

15 B.A. Hamzah, p 148.

16 "Treacherous Shoals," Far East Economic Review, 13 August 1992, p 17.

17 For one of many Chinese Foreign Ministry statements which attempt to ease

regional fears about Beijing's intentions in the Spratlys see Qian Qichen, "PRC For

Peaceful Spratlys Talks," Manila The Chronicle, 20 July 1992.

impacts the United States. However, China's rather grandiose claim could

be seen as impairing U.S. freedom of navigation in the South China Sea.

Generally, the U.S. has always been committed to, and considers freedom of

navigation, a vital national interest. Nonetheless, if we could answer the

always debatable question of how an event somewhere in the world affects

our national security, without another overriding reason for involvement

there is probably no need for U.S. diplomatic intervention in the Spratlys at

this point.

The Philippines dispute that line of reasoning since Manila argues the

1951 Defense Treaty with the U.S. puts its claims in the Spratlys under the

bilateral security umbrella. Both the Bush and Clinton Administrations have

pointedly stated that the agreement only covers territory defined in 1951 and

Military