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Background Briefing: China’s New South Seas Gambit: A Wolf in Sheep’s Clothing? Can ASEAN Get Its Act Together? Carlyle A. Thayer January 6, 2013

[client name deleted] 1- The first news is that China added two destroyers to its maritime surveillance fleet, with one to reportedly patrol in the East China Sea and one in the South China Sea. Reports are that China also plans to build another 36 surveillance ships by 2015. Since its China's maritime surveillance ships that engage the Philippines in the SCS and Japan in the East Sea, what is China's motive for transferring these ships from the regularly navy? To me, it’s fairly obvious they are beefing up their ability to press their disputed claims. For instance, how could the Philippine navy stand up to a destroyer in the Spratly's? ANSWER: When the China Marine Surveillance (CMA) was stood up in 1998 it was composed of a mix of ships including several People’s Liberation Army Navy (PLAN) vessels. Many CMS ships are armed. China then began constructing special purpose surveillance vessels of increasing tonnage. These ships became more sophisticated in their equipment and embarked helicopters. In 2008 Chinese officials announced that the China Marine Surveillance ships needed more protection in terms of armament. And in recent years China has announced plans for a massive expansion in CMS personnel and ships. The transfer of decommissioned yet refurbished PLAN destroyers blurs the line between military and civilian ships. The essential point is that CMS ships are paramilitary vessels. China’s transfer of PLAN destroyers to the CMS shows that China’s accusations against the Philippines of employing its “largest warship”, the BRP Gregorio del Pilar, to Scarborough Shoal was an act of propaganda if not pure hypocrisy. The del Pilar was a former U.S. Coast Guard cutter that was sold to the Philippines and commissioned into the Philippines Navy after being stripped of its most lethal weaponry. The CMS now and in the future towers over the coast guard forces of Vietnam and the Philippines. China uses its paramilitary vessels to advance its sovereignty claims. For example, China will maintain a permanent deployment at and around Scarborough Shoal. It has, to all intents and purposes, annexed Philippine territory. The use of grey hulled warships by any party would be a serious escalation and play into China’s hands.

2 The addition of destroyers to the CMS for deployment in the East Sea is part of a strategy to overwhelm the Japanese Coast Guard by the sheer numbers of ships they must confront. The deployment of former destroyers is also part of Chinese “mind games” directed against Japan. They offer deterrence in the guise of being civilian ships, but quite literally they are an example of a “wolf in sheep’s clothing.” 2-ASEAN's new secretary general, Le Luong Minh, from Vietnam, replaced the former sec-general who was from Thailand. Since Vietnam and China have an ongoing problem in the Paracels, do you think ASEAN led by a Vietnamese head can finally get the association to present a united front again China in the SCS? Or, will they continue to drag their feet? ANSWER: Le Luong Minh’s appointment as the next ASEAN Secretary General was approved unanimously by ASEAN foreign ministers and endorsed by their heads of government. Secretary General Minh will answer to the ASEAN Chair. While the ASEAN Charter has enhanced the role of the Secretary General he must act within a system of consensus decision-making. Minh is an experienced diplomat, and served as Vietnam’s ambassador to the United Nations when it was a non-permanent member of the Security Council. ASEAN has a united stand on the South China Sea, up to a point. It unanimously approved the Fundamental Principles of the Code of Conduct (COC) the week it became deadlocked over the wording of the ASEAN Ministerial Meeting joint communique. ASEAN then unanimously supported Indonesia’s six principles. ASEAN has been unable to clarify the scope of the geographic coverage of its proposed COC in the South China Sea. It is generally assumed that ASEAN positions to date relate primarily to the Spratly islands with the Paracel islands viewed as a bilateral matter between Vietnam and China. ASEAN faces a recalcitrant China. China has declared that “some countries” are not acting under the spirit of the Declaration on Conduct of Parties in the South China Sea (DOC) and until they do condition are “not ripe” for discussions on a COC. China prefers to dilly dally around implementing confidence building measures outlined in the original DOC. China also insists – “when condition are mature” – that it have a hand in drawing up the COC rather than being presented with an ASEAN draft. China is pressing for the creation of an Expert and Eminent Person Group to make suggestions on what should and should not be included in a COC. China’s initial proposal included equal membership – ten Chinese experts and ten ASEAN experts (one from each country). At present ASEAN officials are looking to 2015 at the earliest for a COC. 3-Oher news breaking in the last week is that a new advanced frigate, the Liuzhou, will be assigned to China’s South Sea fleet. Also, just after the New Year Hainan authorities seemed to back peddle somewhat over their new regulations for stopping, and boarding vessels in what they consider their provincial waters. China's Foreign Ministry said that the new rules implemented by Hainan province would be limited to waters extending only 12-autical miles from its coast. However there is still ambiguity since Hainan considers disputed areas in the SCS as part of its coast. What's your take on this?

3 ANSWER: China has given priority to building up the South Sea Fleet and the deployment of the Liuzhou frigate is part of this process (see attached conference paper). When Hainan provincial authorities first announced their new regulations it was unclear what area they covered. Wu Chishun, the head of the Hainan Province external affairs department (and head of the National Institute of South China Sea Studies at Haikuo on Hainan) first stated that they applied to the hundreds of islands and rocks within China’s nine-shaped line. The was later clarified, the new regulations would only apply to islands for which China had already issued baselines. The most recent clarification limiting the new regulations to Hainan Island dramatically restricts the maritime area to be covered. It has been my assessment from the beginning that Hainan province authorities acted on their own volition and that the blowback from the international community caused the central government to intervene. It must be stressed that China’s new regulations, if applied to its duly promulgated territorial sea, is not a violation of international law. All littoral states have sovereignty in their 12 nautical mile territorial sea and can take action, including force, if foreign vessels are engaged in illegal activities. Foreign vessels including military ships, however, have the right of innocent passage. Foreign military ships have sovereign immunity as long as they observe the conditions specified in international law (submarines must surface, ships must fly their national flag, weapons must not be turned on, voyage must be continuous, ships may not conduct propaganda etc.).

Suggested citation: Carlyle A. Thayer, “China’s New South Seas Gambit: A Wolf in Sheep’s Clothing?,”Thayer Consultancy Background Brief, January 6, 2013.

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