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Memri
2 hours ago
- Politics
- Memri
The Historical Context Of The South China Sea Territorial Conflict
On July 12, 2016, exactly, nine years ago, the Permanent Court of Arbitration delivered its final ruling on the case filed by the Philippines against China over territorial disputes in the South China Sea.[1] The court affirmed that China's claim, as embodied by its nine-dash line, has no basis under international law.[2] This following analysis provides the historical context of the disputed waters. (Source: X) The waters first appeared in Indian, Arab, and Chinese historical records as early 206 BCE. The waters were depicted as fishing grounds and trading routes that connected Eastern and Western Asia to Southeast Asia. The waters are peppered with tiny islands and sunken reefs. There, safe havens were built by ancient seafarers as they navigated the open sea. Artifacts originating from a myriad of cultures were found in the islets suggesting that they were used not by one but a host of civilizations. Fast forward to World War II, it became clear that the waters were strategic in a time of war. They were used by Japan as naval outposts during the expansion of its empire in South East Asia. In the 1960s, it was discovered that beneath the seas lie an estimated 11 billion barrels of oil, 190 trillion cubic feet of natural gas and 10 percent of the world's fishing resources. It has also emerged as one of the most important global trading routes. The strategic importance of the waters could not be denied. Of particular interest is the Spratly Islands. The Spratlys is a group of some 100 islets, reefs and shoals. It straddles the Philippines to the east, Vietnam to the west, Malaysia and Brunei to the south, and China and Taiwan to the north. Control over the Spratlys allows military projection and surveillance over the entire Asian region. Six nations claim ownership of the Spratlys but China claims not only the Spratlys but all of the South China Sea. Satellite images shows that Beijing had already constructed artificial islands with airstrips, missile platforms and harbors at Fiery Cross Reef, Subi Reef, and Mischief Reef, among others. Tensions have been escalating, thanks to China's coercive activities and bad behavior. To defuse tensions, ASEAN called for the establishment of a code of conduct as early as 2002. But drafting the code did not start until 2017. By mid‑2023, the second version of the code of conduct was completed with China and ASEAN agreeing to write a third version due to significant disagreements. ASEAN claimants (notably the Philippines, Vietnam) want a legally binding agreement enforceable under international law. China insists on a non-binding framework. Moreover, China is pushing to exclude third‑party military navies (like the U.S.) from the agreement, which ASEAN found self-serving and unacceptable. Without a functioning code of conduct, China has aggressively asserted its claims by way of coercion and deployment of grey zone tactics. The Philippine-China Conflict The Philippine-China stand-off started in 2013, when, in a unilateral act of aggression, China announced that the Spratlys, Parcel islands and Macclesfeild Bank would be administered by Sansha City, a territory of China. Suspicions were rife that China would build a military base to support its navy and air force – something China vehemently denied. Years later, the suspicions were proven true and China was caught in its own lie. The Chinese Coast Guard roped off the entrance of the Scarborough lagoon preventing Philippine vessels from entering, including those of fishermen. The Chinese accosted Philippine vessels that traversed the area, confiscated their contents and detained the crew. It was a blatant disrespect of Philippine sovereignty. The Philippines resisted China's bullying and moved swiftly to defend its sovereignty. It did what any law-abiding republic would do – it took China to court. It was the only claimant of the disputed territories with the courage to do so. In 2014, the Philippines filed a case against China before the Permanent Court of Arbitration of the United Nations Convention of the Laws of the Seas (UNCLOS). The Philippines argued that China's territorial claim was in defiance of the UNCLOS accord for which both China and the Philippines are signatories. The Philippines further argued that the basis of China's claim, its nine-dash line, was conjured out of convenience only in 1946 in contrast to Philippine historical claims whose basis are nautical records dating back to the XV century. For those unaware, China's campaign to claim the entire South China Sea for itself started when a power vacuum arose after Japan's defeat in World War II. In 1946, China's Ministry of Interior Committee deployed two geography students named Fu Jiaojin and Zheng Ziyue to define China's boundaries in the South China Sea. The basis of their claim was an atlas drafted in 1936 by Bai Meichu, a Chinese professor whose atlas was proven to be riddled with errors. The dashes drawn by the two students were a cartographic sketch without clearly defined boundaries. It does not specify where exactly the sovereignty ends and what rights China claims (sovereignty, historic fishing rights, administrative control, etc.). Its ambiguity was deliberate as it allows China to assert a wide range of claims flexibly. The nine-dash line is a preposterous claim by any account. It is for this reason that the international community supports the Philippine's legal argument and absolutely no nation support's China's claim. In 2016, the tribunal ruled in the Philippine's favor saying that China's nine-dash Line is invalid and illegal. It further ruled that China has no legal claim nor historical rights over Philippine Exclusive Economic Zone and that it had behaved unlawfully. The ruling bestows upon the Philippines the legal rights on the waters. On the next installment, an in-depth analysis will be provided on the decision of the Permanent Court of Arbitration. *Andrew J. Masigan is the MEMRI China Media Studies Project Special Advisor. He is a Manila-based economist, businessman, and political columnist for The Philippine Star. Masigan's articles in MEMRI are also published in The Philippine Star.
The Diplomat
3 hours ago
- Business
- The Diplomat
Trump Is Reshaping Southeast Asia's Future. Does He Realize That?
Trump and his team appear to pay little attention to the region, but whether by accident or design his policies are fundamentally altering Southeast Asia's trajectory. U.S. Secretary of State Marco Rubio meets with the press in Kuala Lumpur, Malaysia, July 10, 2025, on the sidelines of the 58th ASEAN Foreign Ministers Meeting. U.S. Secretary of State Marco Rubio was handed an unenviable task on his visit to Malaysia for ASEAN meetings last week. He needed to signal U.S. commitment to the region at the same time President Donald Trump was releasing tariff decisions on social media. Despite claiming that many ASEAN countries would receive better tariffs than other parts of the world, Rubio was handed a diplomatic rebuke by ASEAN foreign ministers, who declared that unilateral tariffs are counterproductive and 'pose complex challenges to ASEAN's economic stability and growth.' The awkward timing around Rubio's visit perhaps reflects a deeper problem: Trump and his team appear to pay little attention to the region. When it comes to global affairs, the Middle East, Ukraine, and trade with China have occupied much of their focus. Likewise, Trump's Cabinet has had only limited engagement with the region to date. In addition to Rubio's visit, Defence Secretary Pete Hegseth has visited Singapore and the Philippines. When U.S. officials do visit Southeast Asia, they've rolled out talking points about U.S. commitment to the Indo-Pacific that have done little to reassure regional countries struggling to deal with U.S. unpredictability. Despite the apparent disinterest in the region, whether by design or accident the Trump administration is making decisions that are fundamentally altering Southeast Asia's future. The question for ASEAN member states is whether they will take steps individually and collectively to avert the worst possible future. Trump is exacerbating divisions within ASEAN. Unity in the bloc has always been paper thin. It has struggled to deal with difficult issues like the South China Sea or the conflict in Myanmar. As current ASEAN chair, Malaysian Prime Minister Anwar Ibrahim has called on member states to take a coordinated approach to negotiating U.S. tariffs. The opposite has happened as each country has tried to strike its own deal with the United States. Vietnam was first out of the blocks, with others continuing bilateral talks. The United States has also widened existing differences within the bloc on how to engage China by doubling down support for its close partners and alienating others. The delicate dance that ASEAN member states do as they hedge between the U.S. and China is becoming trickier. Hegseth was vocal in his support for the Philippines, talking about an 'ironclad' alliance in the face of China's aggression in the South China Sea. Meanwhile, higher U.S. tariffs appear to be targeted at countries that are seen as leaning toward China: Laos (40 percent), Cambodia (36 percent), and Thailand (36 percent) have been hardest hit. If the main game for the U.S. is to compete with China, it's unclear why it is imposing hefty tariffs that will push regional countries closer to it. The Trump administration isn't just exacerbating regional divisions, it is altering the economic outlook. Tariff decisions will amplify and accelerate long-term economic trends, creating winners and losers. Take Indonesia. President Prabowo Subianto's 8 percent growth target is as distant as ever and even 5 percent growth seems challenging. The rupiah has weakened, the stock market has backed away from the highs of last year and the middle class is under pressure. Trump's 32 percent tariff will further weaken Indonesia's outlook. Growth will take a hit and foreign investors may look at other markets that received better tariff rates. If these trends hold long-term, Indonesia will struggle to achieve its goal of becoming a middle income country by 2045. In contrast, the strong economic outlook for Vietnam and the Philippines will be bolstered by their tariffs of 20 percent, the lowest rates in ASEAN. The tariff on Vietnam (which rises to 40 percent for transshipped goods) is likely to put a dint in its 6 percent-plus forecast growth in 2025. However, foreign investment should hold up as the tariff rate maintains Vietnam's attractiveness relative to other ASEAN economies. Likewise, forecasted growth of over 6 percent in the Philippines is likely to take a hit. As with Vietnam, the impact will be temporary and the 20 percent tariff rate will likewise strengthen its attractiveness to foreign investors relative to ASEAN peers. If these trends hold, Trump may help Vietnam and the Philippines escape the middle income trap while Indonesia becomes increasingly stuck. Nothing is ever set in stone with Trump. He's flagged yet another deadline of August 1 before the tariffs come into effect, so countries still have a chance to negotiate better deals. Of course, Southeast Asian countries have agency and are not completely beholden to Trump's whims. Individually they can choose to undertake structural reforms, adjust their growth model, and diversify trading partners. Collectively, there's room to rethink ASEAN's norms and procedures. But all these changes take time and political will. There will also be plenty of twists and turns to come, as we are not even a year into Trump's presidency. But if existing trends continue, the long-term impact will be a region that is more divided politically and economically.
South China Morning Post
5 hours ago
- Business
- South China Morning Post
Trump's trade policies drive Hong Kong industry's ‘China plus N' shift
Hong Kong's industrial sector is increasingly adopting a 'China plus N' strategy as a primary defence against unpredictable United States trade policies, with about 70 per cent of its members already operating in, or moving to, Southeast Asia, according to a report. Steve Chuang Tzu-hsiung, chairman of the Federation of Hong Kong Industries, said that this strategy was a calculated hedge against geopolitical volatility that has been years in the making. 'You don't know which madness [US President Donald] Trump will have tomorrow,' said Chuang. 'It could be 20 per cent in Vietnam or it could change tomorrow, so we have already done our homework.' Chuang clarified that the 70 per cent diversification figure was derived from a survey conducted among the federation's members late last year. The 'China plus N' strategy involves diversifying production and supply chains to multiple locations beyond mainland China, aiming to mitigate geopolitical and economic risks concentrated in a single country. The proactive diversification into the Association of Southeast Asian Nations (Asean) bloc is a direct response to years of tariff uncertainty.
The Hindu
6 hours ago
- Business
- The Hindu
Good progress on EU FTA talks, less so on ASEAN pact review: Government officials
The next few months is going to see a flurry of activity, with various teams of Indian negotiators actively seeking to sign new trade agreements with countries and regions such as the U.S. and European Union (EU) and amend the existing deal with the Association of Southeast Asian Nations (ASEAN), according to government officials. During a press briefing on Tuesday (July 15, 2025), senior officials in the Ministry of Commerce and Industry said that India was seeing 'good progress' in its negotiations with the EU, and less satisfactory progress on the review of the free trade agreement with the ASEAN. They also said that the Fall deadline for a Bilateral Investment Treaty with the U.S. was still in place. 'With regard to the EU, we have just finished the 12th round last week that was on Friday,' Special Secretary in the Ministry of Commerce and Industry Satya Srinivas said. 'We have exchanged our market access offers on services and non-services.' Mr. Srinivas said that the negotiators on both sides could close a 'couple of chapters' of the deal and that they held long discussions on other chapters where there was a divergence. 'We had some sort of understanding that emerged on a few of those divergent issues,' he added. 'All in all, it was a very productive round. I think we did cover a large number of areas and it will be the EU's turn to come to India for the next round in the first week of September.' Regarding the India-U.S. trade deal, the Commerce Ministry officials confirmed that a team from India is currently in Washington to negotiate the deal, their third such visit in the last few months. They reiterated the Fall deadline for the conclusion of a Bilateral Trade Agreement (BTA). The Hindu has learnt that the Indian team has taken sectoral specialists this time around to address minute issues. According to sources, U.S. President Donald Trump's reciprocal tariff letters over the last week haven't had any effect so far. 'If you look at the tariffs today, there are only announcements of tariffs,' a source aware of the negotiations told The Hindu. 'They have not come into effect. Except for the 10% baseline tariff, which is applicable for all countries, no other reciprocal tariff is there for any other country, except for China. China has got a 20% fentanyl tariff over and above this 10% baseline tariff.' Apart from this, the U.S. has imposed sectoral tariffs on iron, steel, auto, and auto components, which range from 25-50%. 'The U.S. trade data shows that the fall in imports the country has faced are largely in these sectors, and in imports from China,' the source further said. 'U.S. imports from all other countries are either staying the same or growing.' Special Secretary in the Ministry of Commerce and Industry Rajesh Agrawal said that teams from India and ASEAN have held nine rounds of meetings so far. 'The progress thus far has been chequered and we would have liked much more progress,' Mr Agrawal said. 'But the good part is we are moving on many aspects, especially on customs and trade facilitation. We are moving on technical cooperation, and there are discussions around market access.' He added that the next two rounds are expected to be in New Delhi in August, and in Malaysia in October, respectively. 'We hope in these two rounds we should be able to see good progress and try to reach some kind of conclusion by the time the ASEAN-India Summit takes place in end-October,' he said. 'The endeavour is in that direction.'
CNA
6 hours ago
- Business
- CNA
CNA938 Rewind - Is it too easy to be a home-based F&B business?
CNA938 Rewind - It's in Southeast Asia's best interest for Timor-Leste to be part of ASEAN: Analyst Singapore has launched an enhanced technical assistance programme to support Timor-Leste's integration into ASEAN, reinforcing its commitment to regional cooperation. Prime Minister Lawrence Wong announced this during an official four-day visit of Timor-Leste's Prime Minister, Xanana Gusmão, to Singapore – it's been over a decade since his first in the role. Lance Alexander and Daniel Martin find out more from Dr Mustafa Izzuddin, Senior International Affairs Analyst, Solaris.
