The US And South China Sea: Strategic And Economic Imperatives – Analysis

The year 2022 witnessed the publication of three major United States (U.S.) strategy documents: the Indo-Pacific Strategy (IPS), the National Security Strategy (NSS), and the National Defense Strategy (NDS). These documents provide insights on how Washington views its security environment, the identification of its national interests, and the major courses of action that it will take to address strategic challenges.

Shortly after   the IPS was released in February 2022, Russia invaded its neighbor Ukraine which then led attention shifting from the Indo-Pacific to Europe. As of this writing, the Russia-Ukraine war is still ongoing. Nevertheless, it is interesting to examine how these strategy documents – specifically the NSS and NDS – articulated Washington’s views on and role in the Indo-Pacific, particularly on the region’s maritime security. After all, the Indo-Pacific does not only possess potential for further trade and development, but is also home to some of the world’s potential flashpoints, including the South China Sea (SCS).

Views on the Strategic Environment

The IPS underscores that “intensifying American focus is due in part to the fact that the Indo-Pacific faces mounting challenges, particularly from the PRC [People’s Republic of China].” Indeed, China “is combining its economic, diplomatic, military, and technological might as it pursues a sphere of influence in the Indo-Pacific and seeks to become the world’s most influential power.” 

Notwithstanding Russia’s invasion of Ukraine shortly after the IPS was released, the NSS made it clear that the U.S. is not abandoning its commitment to the Indo-Pacific. Calling the region as the “epicenter of 21^st century geopolitics,” the NSS described China as “America’s most consequential geopolitical challenge,” and the “only competitor with both the intent to reshape the international order and, increasingly, the economic, diplomatic, military, and technological power to advance that objective.” Russia, on the other hand, poses a more “immediate and ongoing threat to the regional security order in Europe and it is a source of disruption and instability globally but it lacks the across the spectrum capabilities of the PRC.” The NSS warns that the world is “now at an inflection point” and that the coming decade “will be decisive, in setting the terms of our competition with the PRC, managing the acute threat posed by Russia, and in our efforts to deal with shared challenges, particularly climate change, pandemics, and economic turbulence.”

The NDS openly declares that it is a “strategy focused on the PRC.” Working in collaboration with U.S. allies and partners, the overall objective is “to prevent the PRC’s dominance of key regions while protecting the U.S. homeland and reinforcing a stable and open international system.” This goal is consistent with the strategic interests of major powers. In his seminal work, The Tragedy of Great Power Politics, John Mearsheimer argued that in an anarchical and self-help international system, the key to survival is the maximization of power. Indeed, Mearsheimer argued that “states quickly understand that the best way to ensure their survival is to be the most powerful state in the system. The stronger a state is relative to its potential rivals, the less likely it is that any of those rivals will attack it and threaten its survival.” Once a great power achieves regional preeminence, however, it will seek to prevent other states from achieving the same status in their respective regions because “a rival power that dominates its own region will be an especially powerful foe that is essentially free to cause trouble in the fearful great power’s backyard”—or, as Mearsheimer later called it, the “freedom to roam.”

The South China Sea and the Indo-Pacific

The U.S. and China compete on a wide range of issues, particularly in the realm of geopolitics. Indeed, the Indo-Pacific is home to many potential flashpoints, including the South China Sea (SCS). There are a host of reasons why the SCS is an area of competition for the great powers. From a strategic perspective, the SCS is critical for the U.S. to maintain its preeminence in the Indo-Pacific. Indeed, the SCS is part of the First Island Chain – a concept developed by U.S. diplomat John Foster Dulles – used to illustrate an offensive and defensive perimeter running from the Japanese home islands down to Taiwan, the Philippines and Indonesia. As a concept, it sought to contain Chinese military expansion in the Pacific. From the U.S. perspective, close relationships with countries in the First Island Chain reinforce America’s strategic foothold in the region amid talks of its relative decline. From China’s perspective, it is surrounded by America’s allies and partners which prevent Beijing from having a military presence commensurate to its status as an emerging superpower. If China establishes preeminence in the SCS, Beijing will be in a better position to look outward and shift the regional balance of power to its favor.

Beyond strategic dimensions, the SCS is also important for economic and other considerations. For one, the SCS is rich in natural resources. China claims most of the SCS through its nine-dashed line taking in fisheries, natural gas, and oils for itself. To put it into context, the SCS is 3.5 million km² with many fishing grounds and raw hydrocarbons located within the 200 islands and islets. For the claimants, this means that China essentially threatens the blue economy of those involved. Many littoral states still depend on the fisheries to feed their growing nation. Thus, with China’s blatant disregard for the United Nations Convention on the Law of the Sea (UNCLOS), the affected states would have to risk their potential growth because of declining food supplies and increased security threats. 

The economic significance of the SCS also refers to the income generated not only for the families in the coastlines but also for the industries that depend on the fisheries. The numbers are staggering, as the contested waters reportedly provide jobs to their citizens in the millions. Meanwhile, potential energy resources by the U.S. Energy Information Administration are closely estimated to be at 11 billion barrels of oil reserves and 190 trillion cubic feet of natural gas reserves. Indeed, the contested waters can sustain nations once the resources are harnessed for their respective energy and food securities. Moreover, the natural resources in the SCS may shoot up Asia’s development because it accommodates what nations need for sustainable growth. An example for this is the potential increase of income-generating jobs that can be produced by industries seeking to exploit hydrocarbon and marine resources. Claimants in these areas may not have the technology to properly explore and exploit the resources in the SCS which makes justifying the legitimization of international law and its enforcement all the more needed.

Another important reason why the contested waters are important to the international community would be its trade routes. Indeed, the significance of trade with countries in the region was noted by the U.S.-proposed Indo-Pacific Economic Framework for Prosperity (IPEF) where its initial partners in the region “represent 40% of the world’s GDP.” The region has also been emphasized by U.S. President Joseph R. Biden Jr. as “the future of the 21st century economy.” In this regard, the trade routes in the SCS are indeed crucial. The Washington-based think-tank, Center for Strategic and International Studies (CSIS), estimates one-third of the world’s trade passes through the SCS. The data given by the think-tank highlights the Strait of Malacca’s significance to the oil trade and suggests the hypothesis that it may cost trillions of dollars if disrupted. This poses a security risk to the international community. To be specific, shipping costs will rise and countries would have to adjust to the financial burden of disrupted global supply chains. If Beijing controls the sea lanes of communication (SLOCs), China will be in a better position to influence the foreign policy of countries in the region, including U.S. allies and partners. Such a situation will not augur well for U.S. strategy to maintain a favorable regional balance of power.  

Gray Zone Coercion

Clearly, the SCS is important for strategic and economic reasons. It is therefore not surprising why China established artificial islands in the area to advance its massive SCS claims. However, the artificial islands are part of a broader effort to pressure its neighbors: gray zone coercion. By using such tactics, China purposely acts below the threshold of armed conflict. Among other such tactics, China does not use their formal military, but assists its fishermen in securing the contested waters. Known as the maritime militia of the SCS, the Chinese fishing vessels patrols and harasses foreign mariners to protect China’s territorial claim. Thus, other claimants of the contested waters are constrained in advancing their SCS interests due to China’s intimidation, threats, and aggression. There are two scenarios for claimants and non-claimants. For the claimants, their access to their exclusive economic zones (EEZs) will slowly degrade even going as far as China’s probability of restricting other nation’s access. Blue economy would essentially be unsustainable. Coastal nations would resort to more imports and would result in food insecurity and lack of basic necessities. For the non-claimants, a serious crisis or even an armed conflict in the SCS could pose challenges to their economic, energy, and security interests. 

It is interesting to note that both the NSS and NDS recognize gray zone challenges. The NSS notes that more “capable competitors and new strategies of threatening behavior below and above the traditional threshold of conflict mean we cannot afford to rely solely on conventional forces and nuclear deterrence.” The NDS highlighted China’s gray coercion activities even beyond the maritime domain: “The PRC employs state-controlled forces, cyber and space operations, and economic coercion against the [U.S.] and its Allies and partners.”

In issuing the NSS, President Biden stressed that “the rules-based order must remain the foundation for global peace and prosperity.” To advance a rules-based order in light of gray zone challenges, the NDS highlights the need to promote “intelligence sharing, economic measures, diplomatic actions, and activities in the information domain” as “traditional military tools may not always be the most appropriate response.”

As noted earlier, the SCS is significant for the parties involved because of the high-value trade that traverses through the contested waters. Whether a claimant or non-claimant, the importance of the SCS is so sensitive that China’s encroachment strategy disrupts the international rules and norms. Moreover, involving the U.S. in the region enables not only its allies but also other law-abiding states to exercise the international norms. In this regard, the implementation of the three strategies, as well as existing projects such as the Freedom of Navigation Program, and the Maritime Security Initiative, is crucial in promoting peace and stability in the SCS and beyond.  

Underpinned by its network of alliances and partnerships, the U.S.-led rules-based international order is under threat by an increasingly assertive China. A key to ensuring peace and stability in the SCS and beyond is a favorable balance of power. Without the U.S. as balancing force in the SCS, China would likely grow to become the region’s hegemon and expand its gray zone coercion tactics as part of its maritime expansionist agenda.

Vince Andre C. Sabellon and Mico A. Galang are researchers at the National Defense College of the Philippines (NDCP). The views expressed are the authors’ alone and do not necessarily reflect the official position of NDCP.