The South China Sea/East Sea Dispute

:
A Strategic Choice Analysis of the Dispute between the Socialist Republic of Vietnam and the People‟s Republic of China from a Period of Escalating Tensions (2007-2009)

Craig Jeffries University of California, San Diego Graduate School of International Relations and Pacific Affairs Prepared at Trường Đại Học Hà Nội (Hanoi University) December 2009

1 The South China/East Sea Dispute: A Strategic Choice Analysis

Introduction
China and Vietnam The Sino-Vietnamese relationship is arguably the world‟s most complex, and certainly one that gives international relations scholars and security analysts the most trouble when seeking to examine such ties. For example, casual observers most likely assume that relations between the two Communist states are full-bodied and stable, due to the two States‟ vast similarities. Yet, most serious scholars would point out the 2,000 years of shared animosity between the two neighbors, encompassing events such as the Chinese invasion and subsequent thousand-year rule of Vietnam; the Chinese withdrawal of military aid to Vietnam during the latter‟s war with the United States; and the 1979 Chinese invasion of Northern Vietnamese provinces—Beijing‟s response to Hanoi‟s role in toppling the Chinese-backed Khmer Rouge in Cambodia. Still, 21st century world opinion regarding Sino-Vietnamese relations comes off rather positive; with many describing the two states as vibrant Asian “tigers”, whose economies have outpaced all others in the region while enjoying a “big brother-little brother” relationship, where one supposedly learns from the other successful development strategies—Beijing presumably plays the role of the teacher in this perceived bond. Yet, it is perhaps a justifiable conclusion to suggest that the two are heading toward mutual success after a cursory examination of the two state‟s economic, political and social developments is conducted. However, there is at least one issue that has the potential to derail such desires for joint peace and prosperity: both China and Vietnam claim sovereignty over two archipelagoes in the South China Sea/East Sea (SCS/ES).1 Referred to internationally by their English names, the Spratly and Paracel Islands are claimed both by China and Vietnam, as well as a number of other states, including: Brunei, Malaysia, the Philippines and Taiwan. Even as the SCS/ES dispute is now seen by both Beijing and Hanoi as the final outstanding bilateral dispute in their states‟ long and turbulent relationship, the saliency of the issue, evidenced by events documented in this paper, demonstrate its potential to derail recent successes in the Sino-Vietnamese relationship.
1

While most commonly referred to as the South China Sea (SCS), Vietnam objects to this labels and instead calls the body of water the East Sea (ES). To maintain political neutrality, I reference the body of water as the SCS in sections about China and as the ES in sections about Vietnam.

Craig Jeffries 2

Briefing on Spratly and Paracel Archipelagoes: Trường Sa/Nansha and Hoàng Sa/Xisha Spratly The Spratly archipelago, known as Trường Sa to the Vietnamese and Nansha to the Chinese is a group of over 100 reefs, islet, atolls, and islands representing five square kilometers of landmass and spread across 400,000 square kilometers in the SCS/ES. Although the Spratlys are inhabited, the sea that lies around it is fertile fishing ground. Additionally, this area is seen as potentially rich in oil and gas. Approximately 45 islands are occupied by small military contingents from both China and Vietnam; Malaysia, the Philippines and Taiwan also maintain a troop presence.2 Politically, China administers its occupied islands through the provincial government on Hainan;3 while Vietnam oversees its occupied islands in the Spratly chain from Khánh Hòa province.4

Paracel The much smaller Paracel archipelago, known as Hoàng Sa in Vietnamese and Xisha in Chinese consists of only about 30 islets and reefs, covering a mere 15,000 square kilometers in the SCS/ES. Though no inhabitants live on these islands, they are still claimed by China, Vietnam and Taiwan. Yet, only China has military personnel on these islands. As with the Spratlys, the Paracels are prime fishing grounds that also potentially hold underwater deposits of oil and gas. Historical Sketch of Bilateral SCS/ES Dispute Both Hanoi and Beijing utilize vague and unreliable historical documentation to lay claim to both archipelagoes. For instance, Hanoi puts forth the notion that their ancient maps, dating back to the mid 17th century prove their territorial sovereignty over islands off Vietnam‟s central
2

Central Intelligence Agency, “The World Factbook: 2009”, https://www.cia.gov/library/publications/the-worldfactbook/geos/pg.html
3

“Vietnam Protests China’s Establishment of Authority on its Islands”, Nhân Dân, 17 November 2009. Thanh Niên, “Provincial House Confirms Sovereignty Over East Sea Islands”, 19 December 2007

4

3 The South China/East Sea Dispute: A Strategic Choice Analysis

coast described as Bấi Cát Vàng (or the Golden Sandbanks). The Vietnamese also point to texts of this era, suggesting the Lê and Nguyễn dynasties were commercially active in the East Sea.5 China‟s evidence is just as ambiguous; with Beijing citing Han (23-220 A.D.) and Ming (1400sA.D.) dynastic records, describing Chinese occupation, and the conduct of commercial activities on islands throughout the South China Sea.6 The 20th century saw various periods of documented violence in the SCS/ES. Early on in the century, France, Vietnam‟s colonial power occupied most of the Spratlys, and all of the Paracels in 1933, losing control to the Japanese in 1941 as a result of World War Two. Following the First Indochina War, the Democratic Republic of Vietnam (DRV), then in power in Hanoi and allied with communist People‟s Republic of China (PRC), relinquished all claims to both archipelagoes, sending formal correspondence recognizing the former‟s sovereignty in the SCS/ES in 1956. Consequently, the Chinese were able to take control over the entirely of the Paracels that year. However, the Republic of Vietnam (RVN) based in Saigon remained adamant of its claim of sovereignty over both archipelagoes. Tensions rose further between the RVN and the PRC in 1968 with the discovery of oil, climaxing in 1974 with battle of the Paracels, a clash that effectively ended all Vietnamese presence on these islands. Today, China continues to occupy all islands in the Paracel archipelago.7

When Vietnam was unified in 1976, the Communist government in Hanoi reasserted its sovereign claim over the two archipelagoes. Two incidents during this period show the renewed intensity of the dispute between the two Communist states: first, was the 1988 sinking of a Vietnamese transport ship by a Chinese naval vessel off of Johnson‟s reef in the Spratlys; and second was the 1992 oil exploration row between both states and a pair of U.S. energy firms

5

Kelly, Todd C., “Vietnamese Claims to the Truong Sa Archipelago [Ed. Spratly Islands], Explorations in Southeast Asian Studies, Vol.3, Fall 1999
6

Ministry of Foreign Affairs of the People’s Republic of China, “Historical Evidence To Support China's Sovereignty over Nansha Islands”, 17 November 2000.
7

Kelly, Todd C., “Vietnamese Claims to the Truong Sa Archipelago [Ed. Spratly Islands], Explorations in Southeast Asian Studies, Vol.3, Fall 1999

Craig Jeffries 4

cooperating with each on separate, but overlapping exploration contracts in the disputed waters.8 While no military clashes ensued, a war of words between Beijing and Hanoi highlighted the deterioration of relations between the once allies.

Analyzing actions, Gauging Preferences and Predicting Outcomes using the Strategic Choice Approach This paper will attempt to analyze the evolution of the Sino-Vietnamese relationship with regard to the SCS/ES dispute. Utilizing the strategic choice approach (also known as rational choice theory), this paper will show—using recent developments from 2007 to 2009—the extent of which both China and Vietnam‟s capabilities and resolve influence each is actions, beliefs, perceptions, and overall strategy concerning the disputed maritime claims. Finally, this paper will gauge the likeliness of certain outcomes to the SCS/ES dispute, concluding with brief policy recommendations. Before this can be done, however; an introduction of the strategic choice approach is in order. The strategic choice approach is a way of understanding events by extracting and analyzing its most important features: the players, the preferences and strategies involved. Theorists in this field point out that all players are equal in that they are rational; yet the goals they seek to maximize are not identical, as their preferences are different.9 Still, when analyzing a state-to-state conflict, where central governments hold significant power—as is the case in this examination—the sole preference of these actors is to maintain political power. Thus, in order to preserve this power these actors will pursue a strategy based upon: 1) the actions available to them; and 2) the beliefs they have about their opponent. The actions available to an actor depend on how powerful they are relative to their opponent. While their beliefs are based on the how they feel their opponent will react to any such action they pursue. Of course, it is not always easy to discern what the other side is thinking, thus any rational actor will study all available information they have regarding their opponent,
8

Energy Information Administration (EIA): United States Department of Energy (U.S. DOE), “South China Sea Territorial Issues”, December 2009.
9

Walter, Barbara F., “Explaining the Intractability of Territorial Conflict”, International Studies Review, Vol. 5, No. 4, Dissolving Boundaries (Dec., 2003), pp. 137- 153.

5 The South China/East Sea Dispute: A Strategic Choice Analysis

including intelligence gathering, historical actions and diplomatic and political signals sent out. Once an actor is able to secure this information, they can then attempt to determine what the other side is trying to maximize, what preferences it has, and ultimately what strategies they are likely to employ. With this knowledge, the actor can then adjust their own strategy to secure their preference. However, even superior knowledge about your opponent may not be enough to alter their behavior. To do this effectively, an actor must also be relatively more powerful than their opponent. An actor‟s power, according to rational choice strategists is the sum of its capabilities (amount of raw materials, size of population, technological sophistication, military size/quality, and strength of national leadership) and resolve (the willingness of the leadership to follow through with threats). Additionally, relative power determines the amount of strategic tools available to a given actor. The strategic choice approach dictates that actors have three broad mechanisms for influencing other international actors. The first, available to all international actors, whether weak or strong, is persuasion. This tool involves campaigning for a course of action by appealing to sentiments, shared values, ethics, and morals; and by providing information—both of the rewards and consequences of acting in favor or against. In short, this is diplomacy. Still, simply persuading an opponent to change its behavior is seldom effective. Thus, actors with a relative power advantage can typically employ a second set of tools in the form of offering rewards. Examples of reward inducements are: offering entry into international organizations, bilateral free-trade agreements, increased foreign direct investment, as well as military cooperation. If neither persuasion, nor reward inducements effectively alter another‟s behavior, then the truly powerful actor can utilize a third tool: punishment, coercing the weaker actor to relent and change course. Punitive actions range from economic sanctions to military action. Having discussed the basic principles of the strategic choice approach, it can now be applied to the SCS/ES dispute to identify the players, determine their preferences and understand their strategies. Looking at primary evidence from the foreign affairs ministries of China and Vietnam, as well as news material from state-owned media outlets, the following two sections

Craig Jeffries 6

will look at specific actions taken by each state regarding the SCS/ES dispute during the years 2007-2009.10 Additionally, an effort is made to calculate the proportion each strategic tool (e.g. persuasion, reward inducement and punishment) was utilized during the three-year period, as well as its intended target area (e.g. diplomatic, domestic-political, economic and military).11

Uncovering China’s Preferences and Strategy in the South China Sea:
Rational Choice Application for China in the SCS Dispute Who are they? And what are they trying to maximize? Firstly, it must be noted that the Chinese Communist Party (CCP) acts as a unitary actor while conducting the People‟s Republic of China‟s (PRC) international relations.12 Thus, subsequent sections of this paper relating to China should be understood to view the CCP as the sole Chinese actor representing the “national interest” over the whole of the Chinese state and its people. While most would find it hard to accept that the CCP has its people‟s “true” interest in mind; it should be accepted here, simply because no other player in China does or has the ability to exercise the sort of power that the CCP wields. However, one should not overlook the fact that the CCP does need to keep certain segments of the Chinese population satisfied. These groups include the armed forces, as well as the ever growing business community. Additionally, as the CCP maintains political control over more than a billion people, it is vital that it to pay particular attention to popular perceptions of its policies. Having recognized that the CCP is the sole actor representing the PRC, one must then try to understand what interest or goal it is trying to maximize regarding the SCS dispute. Although this task would seem quite difficult, it is in fact, rather simple because like all rational political actors, the CCP ultimately seeks to retain political power. To accomplish this, the CCP needs to
10

While it might seem that the events included in this examination have been arbitrary selected, in fact, most, if not all actions described here were deemed significant enough to have been mentioned by both state’s foreign ministries and/or state news agencies, signifying the salience of the particular event.
11

Acknowledging the fact that a three-year time series, encompassing just 49 events is quite basic and ultimately less consequential, it should not preclude from the true purpose of this examination; which is to observe recent policy trends in order to more accurately predicted future behavior.
12

It should be noted that throughout this paper the terms CCP, China, PRC and Beijing are synonymous and all refer to the same actor.

7 The South China/East Sea Dispute: A Strategic Choice Analysis

placate the aforementioned societal groups. The party-state does this in several ways and employs different approaches for each of the groups. Regarding its SCS maritime claims, the CCP has courted the People‟s Liberation Army Navy (PLAN) by increasing the amount and frequency of military exercises in the SCS‟s disputed waters, as well as building naval facilities on several disputed islands, constructing a submarine base on the southern Chinese island of Hainan, and most importantly increased the PLAN‟s budget. Similarly, the CCP has sought to placate China‟s growing business sector by demonstrating its commitment to ensuring that Chinese businesses have the resources it needs to continue China‟s breakneck economic growth, while also guaranteeing that sea lanes vital to the economy‟s export-driven industries remain stable. Lastly and perhaps most salient—given the sheer size of this group—is the CCP‟s attempt in maintaining favor over the general public. Lately, the party-state has been ensuring its citizens that the country‟s current prosperity, economic growth and rapidly improving international image will be sustained well into the future. These sorts of promises please the Chinese people not only because they are aimed at improving their lives, but also because the average Chinese citizen is extremely nationalistic and any message that highlights the grandeur of the Chinese state or its culture is met with immense passion. Therefore, the CCP sees the SCS maritime dispute as an issue that can help it maintain political power, as it is a strongly nationalistic issue and a potential source of immense economic benefits. What are the CCP’s preferences for a possible outcome to the SCS dispute? Now that the CCP has been identified as the primary actor, and that it seeks to use the SCS dispute to bolster its political legitimacy, an examination of the specific preferences regarding outcomes it would like to see come from the SCS dispute with Vietnam can be conducted. Due to space limitations and for the sake of clarity, only four preferences are listed; by doing so, each is meant to be as diverse as possible. China‟s preferences, from most favored to least favored are: 1) Since the CCP claims nearly all of the islands in the SCS, clearly its most preferred outcome would be to achieve internationally-recognized de-jure sovereignty over all of its claims; which, most recently include around 80 percent of the disputed waters. Additionally, China

Craig Jeffries 8

would prefer to achieve this with the absence of military action and without losing face domestically and internationally. 2) If the CCP cannot achieve its first preference, which seems very likely, Beijing would have to settle for some sort of bilateral recognition of its maritime claims with the other parties in the dispute—most crucially with Vietnam. In this scenario, China would have to make some concessions to Vietnam; perhaps entering into a joint development agreement. For China, however; it would be more advantageous to conclude numerous bilateral deals rather than entering into a single multilateral deal with all the SCS claimants; reasons for which will be discussed later. 3) In the event that the CCP is unable to obtain recognition for its SCS claims under international law, Beijing would most likely be forced to accept a multilateral deal with all other claimants in the SCS. However, Beijing would most likely insist on a joint exploration pact, where it could reap the economic benefits, even though it would lose significant political sovereignty over areas in which it currently controls. 4) The least favored outcome for would look something like an acceptance of a limited military skirmish with Vietnam, if it meant the outright de-facto control over its disputed maritime claims. Of course, this outcome would incur great costs to the CCP—both internationally and domestically. Also, to occupy the very large territory that it claims, Beijing would be required to conduct a rather ambitious and potential costly military confrontation. Thus, a truly successful military confrontation would require the deployment of several PLAN vessels, and perhaps involve nuclear submarines. All in all, this option seems quite risky and could prove to be very costly for the CCP, making them vulnerable both to U.S. retaliation and/or the relinquishment of power domestically. What are the CCP’s Capabilities? Having looked at the preferences for outcomes in the SCS, an examination of the Chinese capabilities that drive those preferences must now be conducted. When analyzing capabilities using the strategic choice approach, one must look at each actor‟s relative power in regard to its opponent. As such, the following seeks to lay out the capabilities available to the CCP in both absolute terms, but more importantly, how they stack up relative to those of Vietnam.

9 The South China/East Sea Dispute: A Strategic Choice Analysis

Military Much has been written about the rapidly developing military capabilities at the CCP‟s disposal. One striking feature is that the Beijing directs the world‟s second biggest military in terms of expenditures at $84.9 billion in 2008—a figure that is growing larger year by year, an alarming trend to most outside of China.13 These capital expenditures undertaken to modernize the military are bolstered by the world‟s largest standing fighting force at about 2.2 million men.14 Particularly worrisome for regional neighbors, especially Vietnam, is the overt expansion and modernization of the PLAN, coupled with a desire by Beijing to build a truly “blue-water” navy, capable of exerting Chinese military influence throughout the region. No doubt, China sees this endeavor as a means to consolidate its claims in the SCS. Finally, China wields the ultimate military deterrent: nuclear weaponry. Such weapons, transported and placed into submarines seem to give the CCP an overwhelming military advantage in any SCS dispute with the Vietnamese. Economic A great deal has been said about China‟s economic transformation and rapid development over the last decade. What is known is that Beijing is now the third biggest economy in world— soon to pass Japan to take second position. While the Chinese economy is nowhere near the size of the United States, Beijing does hold the world‟s largest share of foreign reserves, currently at $2.27 trillion, a fact that shows the strength of China‟s economic capabilities, and the potential damage it could cause rivals.15 Again, even though Vietnam‟s economic growth has in recent years kept pace with its northern neighbor, it is China who has the relative economic advantage; for if Beijing so chose, it could use this advantage to either reward or punish Vietnam in an attempt to influence the latter‟s behavior with respect to the SCS dispute.

13

Figure and ranking from Stockholm International Peace Research Institute, SIPRI Yearbook 2009, pg. 182, accessed at: http://www.sipri.org/yearbook on 15 December 2009.
14

Estimated figure as of 2006, of which 255,000 was naval personnel. Cordesman, Anthony H. and Martin Kleiber, Center for Strategic and International Studies, “The Asian Conventional Military Balance in 2006: Overview of Major Powers”, 26 June 2006, p24
15

Poon, Terence and Li Liu, (Dow Jones Newswire), “China: To Keep Way Of Managing Forex Reserves”, 4 December 2009.

Craig Jeffries 10

Diplomatic As a veto-wielding permanent member on the United Nations Security Council (UNSC), Beijing has the ability to shield itself from international sanction. Additionally, being an influential player in international bodies such as the World Trade Organization (WTO), the AsiaPacific Economic Cooperation (APEC), as well as a prominent observer within the Association of Southeast Asian Nations (ASEAN), Beijing is well-placed to fend off any diplomatic attacks directed from Hanoi regarding the SCS dispute. What is the Strength of the CCP’s Resolve Surrounding the SCS dispute? While identifying China‟s capabilities and how those capabilities could be used to provide an advantage in the SCS dispute appears to be a straightforward exercise, the task of discerning the level of the CCP‟s resolve is much tougher; and one that cannot be accomplished from a simple quantification of the core elements of the state. Rather, a more thorough examination is required to assess the risk-calculations taken by Beijing with regard to the particular strategies pursued in the SCS. In order to do this, scrutiny must be paid to the tools and mechanisms employed by China. Consequently, the following examination will look closely at actions taken by the CCP from the years 2007 to 2009. The conclusion of this section will address the strategic shifts taken by Beijing during the three years under examination, and what that demonstrates about its resolve, as well as the actions likely to be taken by the CCP in the future. Strategic Mechanisms Employed by the CCP (2007-2009) As noted, strategic choice analysis pays particular attention to the types of mechanisms (or tools) used by one actor in hopes of altering another‟s behavior. Here, attention is paid to three types of strategic tools: 1) Persuasion; 2) Reward inducements (e.g. economic incentives, cooperation and engagement); and lastly 3) Punishment—both economically and military. As noted, Beijing‟s enjoys an overall power advantage relative to Hanoi; due primarily to the aggregation of its capabilities. Therefore, the CCP is able to effectively utilize all three types of strategic tools. In addition to focusing on the strategic tools employed, it also important to identify where they are aimed; specifically, whether it is at a domestic-political audience, the diplomatic arena, economic forums, or rather militarily strategies.

11 The South China/East Sea Dispute: A Strategic Choice Analysis

2007 In 2007, five events were observed that shed some light on the types of strategies employed by Beijing; and more interesting provides an opportunity to study the resolve of the CCP with regard to the SCS dispute with Vietnam. Of the five events, four were seen as seeking to persuade, whereas one was identified as punitive. Two particular strategies pursued by the CCP throughout 2007 are continuations of much older strategies, dating back to ASEAN‟s Declaration on the Conduct of Parties in the South China Sea (DOC) in 2002. The first is Beijing‟s desire to develop the PLAN into the region‟s preeminent naval force, capable of forward deployment throughout the region. As such, the CCP has year-by-year increased its military budget, while not hiding its desire to field a “blue-water” navy, equipped with at least one aircraft carrier.16 This military strategy, seeking to add to the CCP‟s already advantageous set of military capabilities, is clearly aimed at securing a chokehold on sea lanes in the SCS, as well as establishing a permanent Chinese presence on the two disputed archipelagoes. Secondly, 2007 saw the Beijing continue its diplomatic policy of pushing for bilateral negotiations with each of the concerned ASEAN members in the SCS dispute. China favors this bilateral approach to an ASEAN-China negotiation because it allows it to play each state off with each other. In other words, a bilateral negotiation including only China and Vietnam, would allow the former to exert its relative power advantage; whereas an ASEAN negotiation would see Vietnam gain bargaining power relative to China. In January 2007, the CCP, keeping with the values and commitments of 2002‟s DOC, sent its coast guard into the Paracel islands to rescue a group of Vietnamese fisherman, whose boat sank off the disputed archipelago.17 This event demonstrates that at this stage in the dispute, China was interested in maintaining cordial diplomatic relations with Vietnam, in hopes of persuading the latter to accept its maritime claims. However, the CCP appeared to shift strategy

16

According to Wu Huayang, deputy political commissar of the Navy, quoted in the China Daily on 3 March 2009: “building an aircraft carrier is the will of the people and is necessary for the development of our navy, as well as being a symbol of China's position in the world.”
17

“Chinese Coast Guard Rescue Vietnamese Fishermen”, Thanh Niên, 14 January 2007.

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later that year, as in November it conducted military exercises throughout the Paracel islands.18 This action shows that even though Beijing ultimately desires a peaceful resolution, it still felt it needed to demonstrate to Hanoi that its military capabilities alone were sufficient enough to secure what it sought in the SCS. At the end of the 2007, the CCP, shifting its focus inward in an attempt to win over its domestic constituents appointed administrative control over the disputed archipelagoes.19 This strategy was almost certainly taken by Beijing in an effort to tap into the nationalistic tenacities of the Chinese people by demonstrating that the CCP leadership was committed to protecting the “interests” of the Chinese people. 2008 In 2008, ten events relating to Chinese SCS maritime claims were observed. Of the ten events, five were seen as seeking to persuade, two identified as reward inducing, and three as punitive. It must be remembered that 2008—the year China hosted the Olympics—was to be the time when China would officially be elevated to “world player” status. As such, one could predict that Beijing would act more aggressively; curtaining any developments in the SCS that would cause it to lose face either internationally or domestically. As such, one policy that Beijing continued in 2008 was its efforts to split its ASEAN SCS rivals by seeking to bilaterally engage with each, thus ensuring it maintained the relative bargaining advantage. Specifically, early on in the year, China pushed the idea of the PanTonkin Gulf Cooperation onto other SCS disputants. The idea—originating from the ASEANChina Free Trade Agreement discussions—was put forth by the southern Chinese province of Guangxi, and sought to promote cooperation in fisheries, maritime energy, environment regulation and tourism. Having eventually won the support of the CCP leadership, Beijing subsequently floated the idea to other ASEAN states, with most of them voicing lukewarm approval, while Vietnam rejected it outright.20 Even though China was not able to secure

18

“Vietnam Protests Chinese Military Exercise in Hoàng Sa”, Thanh Niên, 25 November 2007. “Vietnam Affirms Sovereignty Over East Sea’s Archipelagoes”, Thanh Niên, 4 December 2007.

19

13 The South China/East Sea Dispute: A Strategic Choice Analysis

Vietnam‟s approval for the Pan-Tonkin plan, it did engage with its southern neighbor during the 2nd Vietnam-China Guiding Steering Committee for Bilateral Cooperation. Begun in 2006, this mechanism was set up by the two states in order to develop a long-term strategy for bilateral cooperation covering a broad set of issues—including the maritime dispute. As such, it should be seen as a reward inducing action by Beijing because it provides Hanoi with a forum to extract economic and cooperative agreements with his northern neighbor. For example, the 2nd meeting in Beijing resulted in a joint-statement, stressing that any resolution to the SCS dispute would be handled properly and fairly.21 In March of 2008, signaling the CCP‟s strong desire to play off its smaller rivals in the SCS dispute, foreign minister Yang Jiechi openly pushed for a joint-exploration pact with Vietnam and other claimants.22 This economic strategy, seeking to persuade Vietnam and others to give up their unilateral claims in return for “joint” prosperity actually hinted that China may not truly believe it could achieve its favored preference of internationally recognized de-jure sovereignty over its SCS claims, but may be willing to settle for something less to avoid a costly military confrontation. Yet, the following month, satellite imagery displayed evidence of China’s clandestine construction of an underground submarine base in Sanya, Hainan province, demonstrating that Beijing was indeed intent on strengthening its military capabilities so that in the event of a military confrontation, there would be no doubt who would prevail. International security analysts suggest that the base, when completed, could have the capacity to house nuclear submarines and any future aircraft carrier the PLAN acquires.23 Indicative of the multiple strategies available to China, the CCP flexed its diplomatic muscle in April, when Beijing hosted Vietnamese Communist Party (VCP) General Secretary
20

Li Mingjiang, “Pan-Tonkin Gulf Economic Cooperation Scheme: Making a 'lake' of South China Sea”, Straits Times 15 January 2008.
21

“The Second Meeting of the Guiding Committee for China-Vietnam Bilateral Cooperation Is Held”, The Embassy of the People’s Republic of China in Lithuania, 24 January 2008.
22

Yang, Jiechi, “Foreign Minister Yang Jiechi Meets the Press”, Ministry of Foreign Affairs for the People’s Republic of China, 3 March 2008.
23

“Secret Sanya - China's new nuclear naval base revealed” Jane's Information Group, 21 April 2008.

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Nông Đức Manh. What resulted from that meeting was the following joint statement regarding the SCS dispute:
“The two sides agree to strictly abide by related common understanding of the two countries‟ leaders, to keep the situation in the [South China Sea] East Sea stable, continuously maintain negotiation mechanisms on sea issues, through peaceful negotiations, persistently seek a basic and long-lasting solution that can be accepted by the two sides while actively studying and debating cooperation issues for mutual development in order to reach proper models and sectors”.24

Even as diplomatic strategies seemed to be working for Beijing, on July 2, 2008, the joint China-Philippines-Vietnam seismic study was allowed to expire.25 What this event shows is the lack of resolve on the part of all parties—including China—to ensure the initiative continued. Interestingly, following the expiration of the joint project, Beijing demands that foreign oil firms, BP and Exxon-Mobil sever cooperation with Vietnam‟s state energy firm Petro-Vietnam in the SCS or risk losing future Chinese business. Although, both firms rejected China‟s threat, this action showed that the CCP was willing to use punitive economic threats to have its way in the SCS.26 The following month, Beijing received high-ranking VCP cadres at the CCP’s International Liaison Department signaling that Beijing continued to hold the attention of its Vietnamese comrades.27 Another interesting development was the fact that Beijing allowed a libelous article, describing a CCP-planned 31-day invasion of Vietnam, to remain on more than four different websites during the month of September.28 The article stressed that Vietnam was a major threat to China, and the only thing that stood in the way of the latter‟s

24

“Vietnam, China issue joint statement” Vietnam News Agency, 1 June 2008.

25

Sutter, Robert and Chin-Hao Huang, “China-Southeast Asian Relations: Small Advances, Troubles with Vietnam”, Comparative Connections, October 2008.
26
27

Torode, Greg, “Diplomatic Balancing Act For Oil Exploration” South China Morning Post, 23 August 2008.

Sutter, Robert and Chin-Hao Huang, “China-Southeast Asian Relations: Small Advances, Troubles with Vietnam”, Comparative Connections, October 2008.
28

Ibid.

15 The South China/East Sea Dispute: A Strategic Choice Analysis

domination over Southeast Asia. What is remarkable about this incident is not the article‟s content itself—almost certainly not a product of state officials—but rather the fact that the CCP, notoriously known for its strict policing of the internet, allowed the post to remain on numerous websites for that length of time. It is this fact that many in Vietnam have pointed out, and why this incident should be regarded as a punitive measure directed toward Hanoi. At the same time, this event should also be seen as a tool used by the CCP to shore up domestic support by again tapping into the nationalistic nature of various actors within China. 2009 In 2009, 12 SCS-related events were observed. Of these 12 events, five were seen as seeking to persuade, with two identified as reward inducing, and five as punitive. The increase in punitive actions may reflect Beijing‟s increased capabilities as well as a sharpening of CCP‟s resolve regarding the SCS dispute. Yet, it would be a mistake to say that all of the actions taken by Beijing in 2009 were unilaterally inspired, as will be addressed later, Hanoi raised the stakes on its own in 2009—most notably by submitting a unilateral claim to the United Nations requesting an extension of its continental shelf; thus some of China‟s acts are retaliatory, and will be identified as such. As during the previous two years, in 2009, Beijing continued to pursue the strategy of enhancing its naval capabilities in order to project its military power throughout the SCS. Additionally, the CCP maintained the policy of seeking bilateral engagement with individual ASEAN members to discuss and settle its maritime disputes. The year started with the Chinese State Oceanic Administration calling for Chinese businesses and individuals to move to uninhabited islands in the Paracels and the Spratlys in order to bolster China’s sovereign claims; a strategy that appears to be an attempt by Beijing to sustain and possibly strengthen domestic support for its SCS policy.29 The PLAN’s harassment in March of a U.S. naval vessel U.S.S. Impeccable said to be in Chinese territorial waters off Hainan continues to show that Beijing‟s military capabilities, as well as its resolve to use it, were increasing.30 The incident also signals to China‟s regional foes

29

“Ministry Responds to East Sea Claims”, Vietnam News Agency, 9 January 2009.

Craig Jeffries 16

that Beijing is perhaps even willing to confront the United States in order to protect its perceived maritime sovereignty. However, in an attempt to cool rising regional tensions, the CCP appeared to shift strategy yet again, as in the following month, Prime Minister Wen Jiabao met with his Vietnamese counterpart, Nguyễn Tấn Dũng to say that the two sides should keep an eye on long-term interests and the overall situation. Additionally, the two agreed that both sides should limit actions perceived to be provocative in hopes that the two could enjoy the mutual benefits of joint development in the SCS.31 This strong signal send to Hanoi, seems to be a careful attempt by Beijing to lay out the risk, rewards and consequences for any Vietnamese action regarding the SCS dispute. However, Sino-Vietnamese ties began to seriously deteriorate in April and May of 2009. Three incidents show the different strategies used by Beijing, with a further strengthening of resolve, especially evident with regard to the use of its military superiority. First, Beijing, responding to Vietnam‟s unilateral submission to the United Nations Commission on the Limits to the Continental Shelf (UNCOLCS) to extend its continental shelf to incorporate both archipelagoes, sends the UN a “u-shaped” map showing its own maritime claims in the SCS, along with a diplomatic note, asking them to reject Vietnam’s claim.32 A second and more troubling incident was the CCP‟s unilateral decision to impose a three-month fishing ban in the SCS, effectively punishing the economic activities of Vietnamese fishermen at the height of their fishing season.33 The third and final action by Beijing during this tense period was the deployment of eight fishery and PLAN vessels from southern China to the SCS to enforce the ban on fishing activities.34 Obviously, the deployment of Chinese vessels to enforce its ban was response by Beijing to Hanoi‟s own “raising of the stakes” with regard to the latter‟s UN
30

Thayer, Carlyle, “Recent Developments in the South China Sea, International Workshop on The South China Sea Cooperation for Regional Security and Development” 26-28 November 2009.
31

“Chinese Premier Meets with VN Counterpart”, Ministry of Foreign Affairs for the People’s Republic of China, 17 April 2009.
32

A copy of China’s response and “u-shaped” map can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/mysvnm33_09/chn_2009re_mys_vnm.
33

Thayer, Carlyle, “Recent Developments in the South China Sea, International Workshop on The South China Sea Cooperation for Regional Security and Development” 26-28 November 2009.
34

“FM: South China Sea Fishing Ban ‘Indisputable’”, Xinhua, 9 June 2009.

17 The South China/East Sea Dispute: A Strategic Choice Analysis

submission; but what is particularly salient though is that this time, Beijing saw it less useful to diplomatically engage with Hanoi, rather finding it easier to return to its position of superiority in the SCS via punitive measures. China continued to assert itself as it arrested Vietnamese fishing vessels throughout the summer of 2009. Hanoi‟s protests fell on deaf ears, as Beijing’s insisted that it was within its right to “protect” the fishery stocks in its “own waters”.35 However, in September, drawing on its preference to avoid a military confrontation, the CCP continued to push the idea of a joint exploration pact with Vietnam and other claimants—ideally bilaterally. A Chinese envoy speaking in the Philippines stated that all parties in the SCS dispute “should join hands in development” and refrain from taking provocative unilateral actions, thus signaling that China was again willing to provide economic incentives to solve the maritime quarrel.36 In November, Beijing continued the now routine strategy of shoring up domestic support for its SCS policy. This time, the CCP established village communities on several disputed Paracel islands claimed by Vietnam; specifically, Phú Lâm and Đảo Cây.37 Finally, as Hanoi hosted an International Workshop on the South China Sea, Beijing dispatched three vessels to the disputed archipelagoes, as well as to the Tonkin Gulf.38 Surely, this action was meant to remind Vietnam that no matter how much international support it could garner for its maritime claims, Beijing still possesses a vastly superior military capable of nullify such diplomatic achievements. Discernable Strategic Shifts and Implications for Resolve Observing Trends With a clearer sense of the actions, strategies and tools employed by CCP during the last three years regarding the SCS dispute with Vietnam, it is now possible to try and discern trend

35

Ibid. “China Proposes to Move on with Joint Development Formula in SCS”, Xinhua, 22 September 2009. “Vietnam Protests China’s Establishment of Authority on its Islands”, Nhân Dân, 17 November 2009. Hương Giang và Mỹ Loan, “Phản đối Trung Quốc đưa tàu đến Hoàng Sa”, Tuổi Trẻ, 28 Tháng 11 2009.

36

37

38

Craig Jeffries 18

patterns, and what those shifts signify for future Chinese policy in the SCS. Appendix A quantifies the observed events and identifies the strategic tools used, as well as their intended targets. Thus, with that knowledge, the following assessments can be made: First, it is notable to point out that the percentage of actions perceived as being persuasive fell from 80 percent in 2007 to 42 percent in 2009. Admittedly, this conclusion is drawn from a very small sample set of major events. Nonetheless, coupled with the rise in perceived punitive actions taken by the CCP—20 percent 2007 to 42 percent in 2009—China is no doubt feeling more comfortable using its military and economic advantage to punish its southern neighbor. Looking now to the areas in which Beijing has directed SCS actions; one should be reassured that, on average, Beijing has preferred to use diplomatic methods, as 40 percent of their actions were identified as such, while economic measures ranked second with an average use of 27 percent. Military actions ranked third, ahead of domestically-targeted political actions with 20 and 13 percent respectively. Future implications There should be no doubt that the CCP—being a rational actor, primarily seeking to retain political power—desires to achieve its goal of securing and strengthening its maritime SCS claims via persuasive diplomatic behavior. Additionally, based on the evidence presented here, it should be noted that Beijing is also willing to provide economic rewards to Vietnam, specifically, in the form of joint exploration projects, an example being the Pan-Tonkin Gulf Cooperation. Thus, one should be hopeful that additional reward inducements will continue to be offered by Beijing to Hanoi. Even though China has recently flexed its military muscle, displaying its increased naval capabilities, and perhaps also signaling a greater resolve to use them—both to Hanoi and to a domestic audience—it is not likely that the CCP will actually threaten military force to solve the SCS dispute. This is precisely because any military action taken by China to end the dispute would be seen as unjust not only by regional players, but also to the wider international community; something Beijing is not keen to let happened, evidenced by its carefully-managed image during the 2008 Olympics.

19 The South China/East Sea Dispute: A Strategic Choice Analysis

Yet, it would be a mistake to conclude that China will suddenly stop developing its armed forces, particularly its navy. For it is vital that Beijing maintain a sufficient military deterrent, capable of patrolling the SCS, not just to defend against threats from Hanoi but also to counter the decades-old U.S. naval superiority in the region. Additionally, China requires a strong navy—especially one with “blue-water” capable—to allow it to protect SCS sea lanes vital to its economically strategic export-sector. Lastly, it must be known that punitive economic measures such as sanctions, boycotts or embargoes will only be counterproductive to Beijing, as its southwestern provinces of Guangxi and Yunnan depend on trade with Vietnam. Therefore, it should be concluded that although tensions in the SCS have risen lately, with Beijing seeming more keen on punishing Vietnam, it is also not likely that the CCP will threaten or use overly harsh punitive economic measures to attempt change Vietnam‟s policy in the SCS.

Uncovering Vietnam’s Preferences and Strategy in the East Sea:
Rational Choice Application for Vietnam in the ES Dispute Who are they? And what are they trying to maximize? Like China, Vietnam is ruled by a single dominant party. As such, it must also be noted that the Vietnamese Communist Party (VCP) acts as a unitary actor while conducting the Socialist Republic of Vietnam‟s (SRV) international relations.39 Thus, it should be understood that it is the VCP that is the lone Vietnamese actor representing the “national interest” in Vietnamese foreign affairs. Again, similar to China, it should be accepted that no other player within Vietnam does or has the ability to exercise the same level of power the VCP does in influencing the foreign policy decisions of the state. However, the VCP does have to placate certain segments of society in order to maintain political power. Just as the CCP is beholden to certain societal groups, so too is the VCP. Since strategic choice theory mandates that all actors are rational, it is subsequently known that what the VCP ultimately desires is to preserve political power. Thus, the VCP must
39

It should be noted that throughout the remaining of this paper the terms VCP, Vietnam, SRV and Hanoi are synonymous and all refer to the same actor.

Craig Jeffries 20

conduct ES policy in an effort to please its domestic constituents: specifically, the small but influential business lobby, and more broadly the whole of the Vietnamese populace. Similar to the CCP, the VCP has chosen to pursue an ES policy that strikes at the nationalistic tendencies of its citizens. What are the VCP’s preferences for a possible outcome to the ES dispute? Now that the VCP has been identified as primary actor, and that it seeks to use the ES dispute to bolster its political legitimacy, an examination of the specific preferences regarding outcomes it would like to see result from the ES dispute with China can be made. Vietnam‟s preferences from most favored to least favored are: 1) Since the VCP claims nearly all of the islands in the ES, its most favored preference would be similar to its Chinese opponent, in that it seeks internationally-recognized de jure sovereignty over all of its claims—achieved peacefully, without losing face domestically nor internationally. 2) If the VCP cannot achieve its first preference, which, like China, appears unlikely; Hanoi will likely have to settle for a multilateral agreement with all other parties in the dispute, which recognizes most of its claims. A multilateral settlement is preferred by Hanoi over a bilateral deal with China because it gives Vietnam significantly greater bargaining power with respect to China, as it will be harder for Beijing to push around a grouping of states. Additionally, in this scenario, Vietnam would also be keen on reacquiring some of the islands in the Paracel archipelago that it lost during the 1974 battle of the Paracels with China. 3) In the event that the VCP is neither able to secure internationally recognized de-jure sovereignty for all of its ES claims, nor a multilateral agreement for sovereignty over partial claims; Vietnam would consequently have to give in to Chinese diplomatic pressure and agree to a bilateral understanding with Beijing over how to split up control of the disputed archipelagoes. This scenario would most likely have to include the promise of jointdevelopment in the areas of fisheries, sea patrols and most importantly, oil and natural gas exploration for it to truly be a serious option for Hanoi. 4) The least favored preference for Hanoi would look something like a continuation of the status quo, which means the absence of de-jure sovereignty for its ES claims and only limited

21 The South China/East Sea Dispute: A Strategic Choice Analysis

de-facto control in the Spratlys, with no control at all in the Paracels. A continuation of the status quo would also mean that Vietnam would remain beholden to the punitive actions of its much stronger northern neighbor. Additionally, since the VCP must soothe popular opinion, a continuation of the status quo in the ES—where Vietnamese fisherman are harassed, beaten and arrested—will cause great damage to the regime‟s reputation amongst an extremely nationalistic population who view the ES dispute as the most important foreign policy issue for its country. What are the VCP’s Capabilities?
Military

Vietnam maintains a diminutive-sized military when compared to its northern neighbor, with Hanoi spending only $1.3 billion on military expenditures in 2008.40 Relative to the Chinese PLAN, Vietnam‟s navy would require significant international assistance if it truly desired to mount a serious military challenge to China in the ES. What the lack in relative military capabilities shows for Vietnam‟s ES policy is that to achieve what it wants in the disputed waters, it cannot rely on punitively-aimed military actions to be effective in altering Chinese behavior.
Economic

With the world‟s 58th biggest economy, measured in nominal GDP, and economic growth second to only China in Asia, Vietnam is no doubt on its way towards enriching the lives of its citizens.41 Yet, this economic growth, while impressive, is not enough to influence Chinese ES policy. Hanoi does not, at this stage—or perhaps never will—be able to influence Chinese foreign policy via economic means, due to the sheer magnitude of the capabilities gap in this area. This is not to say that Vietnam can never attempt to provide economic inducements to China, or that the latter will not readily accept them; but rather, it should be noted that the economic tools available to Hanoi relative to Beijing‟s own does not allow one to conclude that the use of such would be overwhelming effective.

40

Information from the Stockholm International Peace Research Institute (SIPRI), http://milexdata.sipri.org/result.php4.
41

World Bank, World Development Indicators database, “Gross Domestic Product”, 7 October 2009.

Craig Jeffries 22

Diplomatic

As a non veto-wielding non-permanent member on UNSC, Vietnam has been able to build its reputation as a serious and committed player in international relations. Yet, with regard to influencing China, this two-year assignment—set to expire next year—does nothing to alter the balance of diplomatic power between the two communist states. With China holding veto power and the right to vet the council‟s agenda, Hanoi is in no position to challenge Beijing within this forum. The same can be said for other international organizations where the two coexist. Still, there is one multilateral forum where Vietnam may have an edge over China: that is ASEAN. Soon to take over rotating chairmanship of ASEAN in 2010, Vietnam will then be able to chose whether to proceed with China-related negotiations or delay them for an entire year, thus giving itself some, albeit temporary, bargaining leverage. What is the Strength of the VCP’s Resolve Surrounding the ES dispute? As previous noted while examining the CCP‟s actions and beliefs, the task of assessing an actor‟s resolve is quite more difficult than identifying its capabilities. Nevertheless, the following section will attempt to gauge the resolve of the VCP by observing actions it took from 2007 to 2009 regarding ES policy. The conclusion of this section will address the strategic shifts in VCP policy regarding the ES during the three years under examination; and what any shifts demonstrates about its resolve, and/or future ES policy. Strategic Mechanisms Employed by the VCP (2007-2009) Although, Vietnam can and does employ all three strategic tools (persuasion, reward inducements, and punishment) to try to influence China, the effectiveness of each is determined by the overall power equilibrium relative to Beijing. In other words, even though Hanoi has the basic capabilities to send its naval vessels into the ES to patrol, Beijing—having the far superior navy— would surely respond by sending its own, thus nullify the Vietnamese action. Thus, what should be predicted in this three-year examination of VCP ES policy is the higher frequency in the use of persuasive actions, coupled with the limited use of punitive measures. Additionally, focusing on the target areas, one would likely predict that Hanoi would more often than not focus on diplomatic mechanisms, due to the inferiority of its overall capabilities relative to Beijing.

23 The South China/East Sea Dispute: A Strategic Choice Analysis

2007 In 2007, seven events were observed. Of the seven events, six were seen as persuasive, whereas one was identified as punitive. By analyzing these events, one should have a better picture of not only the strategies that Hanoi sought to employ but also the potency of the VCP‟s resolve with regard to the ES issue. Throughout 2007, Vietnam‟s foreign ministry, responding to Chinese actions taken in the ES, repeatedly stated that the dispute between the two communist states could and would be solved peacefully under the guidelines of the 1982 United Nations Convention on the Law of the Sea (UNCLS) and 2002 DOC. Thus, Hanoi routinely sent a clear signal to Beijing that it did not want to risk war over the ES dispute. Yet, the foreign ministry time and time again in 2007 stated that Vietnam had the historical and legal evidence to back its claims of sovereign control for both the Spratly and Paracel archipelagoes. In one such incident, Vietnamese foreign ministry spokesman, Lê Dũng said as much, while protesting Beijing‟s construction of sovereign markers in the ES.42 The reaffirmation of Vietnam‟s possession of historical and legal evidence over its ES maritime claims should be seen as an attempt by the VCP to appeal to its domestic constituents with the purpose of maintaining their political allegiance. Signifying the strength of the VCP‟s resolve in seeking to uphold peaceful relations with its neighbor, the Vietnamese coast guard, in a tic-for-tac response, rescued 15 Chinese fishermen off of Khánh Hòa province’s shoreline.43 This action was then followed up with a goodwill trip to Beijing in April by Vietnamese National Assembly chairman Nguyễn Phú Trọng; again showing Hanoi‟s resolve and commitment to a peaceful settlement. His visit marked the tenth round of expert-level negotiations on the ES dispute between the two states.44

42

Lê Dũng, “Vietnam once again reaffirms its sovereignty over Hoàng Sa and Trường Sa archipelagoes”, Bộ Ngoại Giao, 28 December 2006.
43

“Chinese Coast Guard Rescue Vietnamese Fishermen”, Thanh Niên, January 14, 2007. “NA Chairman Trong leaves for official visit to China”, Vietnam News Agency, 13 April 2007.

44

Craig Jeffries 24

Yet, relations between the two states over the ES dispute began to deteriorate in November, as a direct result of Beijing conducting military exercises throughout the Paracel islands. Consequently, Vietnamese Prime Minister Nguyễn Tấn Dũng met Chinese Premier Wen Jiabao on the sidelines of the annual ASEAN summit to convey his concern over escalating ES affairs.45 This diplomatic action signaled both that Hanoi recognized the superiority of Chinese capabilities—especially militarily, and that its resolve in maintaining peace with Beijing remained strong. What it also shows is how very few effective strategic tools Vietnam has at its disposal for dealing with China.

What must have been a response to both the Chinese military exercises in the Paracels, as well as Beijing‟s appointment of administrative control of the disputed archipelagoes to Hainan; Vietnam, in December, allowed yet condemned anti-China protests in Hanoi and Ho Chi Minh City.46 This action or “non-action” shows that the VCP is more than willing to use the ES dispute with China as a way to incite the nationalistic tendencies, as well as the historical loathing of the Chinese by the Vietnamese people for its own political gain. Likewise, the provincial resolutions by Khánh Hòa and Đà Nẵng, declaring political control over Trường Sa (Spratly) and Hoàng Sa (Paracel) respectively, on the surface appeared to be a response to the Chinese administrative appointment; yet, knowing that the VCP ultimately seeks to maintain power, it must of calculated that these moves would additionally bolster its support amongst its population.47 2008 In 2008, five incidents relating to Hanoi‟s ES policy were observed. Of the five events, three were seen as seeking to persuade, while two were identified as reward inducing, and none as punitive. The absence of a recorded punitive action show either that Hanoi‟s resolve in maintaining peaceful relations with Beijing remained strong, or that the VCP recognized that

45

“PM meets Chinese counterpart on sideline of ASEAN Summit”, Bộ Ngoại Giao, 22 November 2007.

46

“Protests In Front Of Chinese Diplomatic Buildings in Hanoi and Ho Chi Minh City Sunday Were Unapproved By Local Governments, Said Lê Dũng” Thanh Niên, 11 December 2007.
47

“Provincial House Confirms Sovereignty Over East Sea Islands”, Thanh Niên, 19 December 2007.

25 The South China/East Sea Dispute: A Strategic Choice Analysis

punitive measures will only cause itself harm thus be counterproductive. Of course, both calculations could have been made, as the two are not mutually exclusive. The Vietnamese foreign ministry sought to keep the ES issue on the public‟s radar, as it consistently stated that Vietnam had the historical evidence to support its claim of sovereignty over the two archipelagoes. The VCP thus, sought to continually signal to its domestic public that it would not back down to China. Yet, on the diplomatic front, the VCP began to use the very clichéd Socialist motto of “friendly neighborliness, fraternity and comradeship” developed with the CCP in discussing a way forward in the ES.48 Even though such talk is in line with Hanoi‟s desire for a peaceful settlement, this sort of diplomatic banter, emphasizing shared bonds and Socialist allegiance is most certainly unappealing to the truly nationalist individuals in Vietnam, who wish for their leaders stand up to China. Yet, the VCP most likely concluded that at the present time, a signal of friendly intentions to Beijing was more pressing than an attempt to shore up domestic support. Yet, even as Hanoi tried to soothe ties with Beijing, things turned sour again in 2008, as Hanoi summoned senior Chinese diplomats twice in September to protest Beijing‟s allowance of an article outlining a Chinese invasion of Vietnam.49 In an attempt to further ease tensions, another meeting between the two state’s prime ministers took place in October, where both sides again signaled their shared desired to reach a peaceful conclusion based on the guidelines and principles enshrined in the UNCLS, the DOC and—at China‟s insistence no doubt—through future joint development.50 Specifically, both sides engaged in what should be identified as dual reward inducing actions, as the two states signed a cooperation agreement on behalf of the two state-owned energy firms, CNOOC and Petro-Vietnam. In addition,

48

Lê Dũng, “Vietnam’s policy of resolving all disputes in the Eastern Sea through peaceful negotiations”, Bộ Ngoại Giao, 18 February 2008.
49

Torode, Greg “Vietnam Protests Over Chinese Invasion Plans; Beijing Dismisses Online Threats”, South China Morning Post, 5 September 2008.
50

“China-Vietnam Joint Statement” Ministry of Foreign Affairs for the People’s Republic of China, 9 January 2009.

Craig Jeffries 26

Beijing and Hanoi set up a hotline where the two capitals could communicate quickly in an attempt to diffuse any escalating situation in the disputed waters.51 2009 In 2009, ten events were observed; where seven were identified as seeking to persuade, two were seen as reward inducing, and one as punitive. More fascinating than the overall increased volume of Vietnamese actions, was Hanoi‟s first “unilateral” punitive action regarding the ES dispute; as in April, Vietnam filed two submissions—one jointly with Malaysia—to the United Nations Commission on the Limits to the Continental Shelf, requesting that it be allowed to extend its continental shelf beyond the 200 nautical mile limit to incorporate all of the Paracels and part of the Spratlys.52 53 This action is described as punitive because it is an effort by Hanoi to circumvent the influence of Beijing by seeking international recognition for its maritime claims; thus causing the latter to lose diplomatic face by having to aggressively respond, as it did by sending its own correspondence to the UN maritime body, protesting the Vietnamese action as a breach in its sovereignty, and recommending that the UN not consider the submission.54 Overall, Hanoi‟s UN submission signals to both its domestic and international audiences that while not looking for war, it maintains committed to securing de-jure sovereignty over its ES claims. Yet, even as Hanoi seemed to be stepping up pressure—albeit diplomatically— on Beijing, Prime Minister Dũng reiterated Vietnam’s policy of seeking a peaceful outcome to the dispute in April, suggesting that the Sino-Vietnamese maritime dispute could be resolved

51

“Vietnam, China vow to deepen cooperation”, Vietnam News Agency, 27 October 2008. A copy of Vietnam and Malaysia’s joint proposal can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/submission _mysvnm_33_2009.htm. A copy of Vietnam’s partial proposal can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/submission _vnm_37_2009.htm. A copy of Vietnam’s reply to China’s reply and “u-shaped” map can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/mysvnm33_ 09/vnm_chn_2009re_mys.

52

53

54

27 The South China/East Sea Dispute: A Strategic Choice Analysis

peacefully, just as the Tonkin gulf and land border demarcations have shown.55 However, in the face of increasing tensions between the two states due to Beijing‟s unilateral three-month fishing ban, and most likely out of fear of losing public support on the issue, the VCP in April appoints an administer to govern the Paracels, even though it has no physical presence on the archipelago.56 The following month, foreign ministry spokesman Lê Dũng, bluntly responding to China‟s unilateral fishing ban in the ES, states that any activity in the ES or within Vietnam’s exclusive economic zone would be seen as a violation of its sovereignty, thus signaling to both the Vietnamese domestic audience, as well as to China, that its resolve remains firm, and that it will not be bullied.57 A particular event involving the arrest and alleged maltreatment of Vietnamese fisherman by Chinese military personnel stationed on the disputed islands prompted Vietnam to send a diplomatic note to the Chinese embassy in Hanoi, demanding that they look into the incident and punish those responsible.58 This rather weak response clearly demonstrates the lack of effective tools available to the Vietnamese to hit back at a blatantly aggressive Chinese action.

Yet, the current inability for Vietnam to meaningful hurt China may be about to change, as in October, Vietnam unveiled its goals for its 2010 ASEAN chairmanship. On the agenda were a multitude of projects relating to China, such as the ASEAN-China Free-Trade Area, the strengthening of the DOC and the continued development of the ASEAN-China Strategic Partnership.59 Vietnam, with the ability to control the ASEAN agenda will enjoy a rare moment, where it will have the capacity to either reward or punish China in an effort to influence the latter‟s behavior on ES policy.
55

Torode, Greg “Hanoi Hopeful Over Maritime Row with Beijing; Disputes Can Be Solved, Says PM”, South China Morning Post, 20 April 2009.
56

“China Says Vietnam’s Appointment of Official in Xisha islands ‘illegal’’’, Xinhua, 28 April 2009. Lê Dũng, “Concerning the Fishing Ban by China”, Bộ Ngoại Giao, 26 May 2009

57

58

“Vietnam’s reaction to inhumane acts by Chinese Armed officers toward Vietnamese Fisherman”, Bộ Ngoại Giao, 21 October 2009.
59

“Deputy PM: Vietnam to successfully assume ASEAN Chair”, Vietnam News Agency, 25 October 2009

Craig Jeffries 28

However, doing what it could until 2010, Hanoi continued to send diplomatic notes to protest actions taken by Beijing in the ES, as it did in November, voicing its disapproval over the Chinese establishment of district-level administration on Hainan for both the Paracel and Spratly archipelagoes.60 However, Hanoi did demonstrate that it could still offer reward inducements to Beijing, as it finalized the land demarcation and border management agreement with its northern neighbor, shortening the latter‟s long list of pending land border issues.61 This agreement also makes clear that both sides are willing to engage with other, and that with time, both states are able to solve tough bilateral issues.

Even with the VCP realizing that it could achieve diplomatic victories via engagement in other areas, it sustained its commitment to employing unilateral initiatives for it maritime claims; an example of which was Hanoi hosting numerous international scholars and experts assembled to provide recommendations on the ES dispute.62 The international workshop on the East Sea dispute as it was called, no doubt was an attempt by Vietnam to strengthen its claims through the support of international “experts” and to counter the vast strategic capabilities of China.

In a similar, yet more noticeable vain to shore up international support, Hanoi sent its defense minister, Phùng Quang Thanh to Washington, D.C. in December to meet his U.S. counterpart, as well as other prominent American politicians to discuss strengthening military, as well as political ties.63 As both the U.S. and Vietnam fret about China‟s military buildup, this action should be seen as mutually beneficial to both Washington and Hanoi, as it is clearly intended to enhance Vietnam‟s military capabilities, in the form of a military partnership with

60

“Vietnam Protests China’s Establishment of Authority on its Islands”, Nhân Dân, 17 November 2009. “Major Accords End Vietnam-China Land Border Negotiations”, Nhân Dân, 19 November 2009. Hương Giang, “Bế mạc hội thảo quốct tế về biền Đông”, Tuổi Trẻ, 28 Tháng 11 2009.

61

62

63

Bowen, Ernest, “Vietnamese Minister of Defense General Phung Quang Thanh”, Center for Strategic and International Studies, 14 December 2009.

29 The South China/East Sea Dispute: A Strategic Choice Analysis

the region‟s preeminent naval force—the United States; and to add another U.S. ally in the region should hostilities ever break out between the U.S. and China.

Discernable Strategic Shifts and Implications for Resolve Observing Trends Having now scrutinized actions taken by Hanoi, both unilaterally, and in response to Chinese actions, it is now possible to try to discern trend patterns, and how those shifts could affect future Vietnamese policy in the ES. Appendix B quantifies the observed events and identifies the tools used, as well as their intended targets. Thus, the following assessments can be made: Since it is known that Hanoi possesses far fewer capabilities to effectively alter the behavior of Beijing via reward inducements or punitive actions, it is no surprise that throughout the three years under examination, Vietnam used persuasive methods 73 percent of the time. Additionally, focusing on areas in which Hanoi directed ES actions, it is again no surprise to see that Vietnam—relatively the weaker actor in the dispute— used diplomacy 58 percent of time. Demonstrating the importance of nationalism in this dispute, the VCP sought to influence its domestic audience 35 percent of the time. Finally, again showing the relative weakness of Hanoi, actions regarded as being directed at economic targets counted for a mere eight percent, while the VCP did not once utilize its military during the three years under examination. Future implications Recognizing that it is at a several capability disadvantage relative to its Chinese opponent, Vietnam has been attempting to influence China the only way it can: through diplomatic channels, trying to demonstrate both to the Chinese, as well as others, the virtues of the Vietnamese position regarding its disputed ES claims. Playing up the two states‟ shared historical values, cultures and ideologies, Hanoi has been trying—mostly unsuccessfully—to win over Beijing. However, since both states have competing interests in the ES dispute, it is not likely that Hanoi can secure what it desires through persuasive means alone. Yet, Vietnam does not have the capability to effectively threaten China with military action, nor does it have the

Craig Jeffries 30

economic weight to impose unilateral sanctions. Thus, if the VCP is to achieve some sort of victory here, it will be from a combination of persuasive and reward inducing actions. Particularity, Vietnam could offer its cooperation in securing transport routes, or lend its support to the plethora of proposed ASEAN-China cooperative agreements. Most importantly, as Hanoi takes over the ASEAN chairmanship in 2010, it will have the ability to set the agenda to either favor or punish China by either implementing Chinese-related initiatives or postponing them for a year. Lastly, Vietnam, as evidenced by Defense Minister Phùng Quang Thanh‟s visit to Washington this December, appears to be more aggressive in its pursue to strengthen its military capabilities vis-à-vis China.

Conclusion
The Future of the Dispute Any attempt to predict future outcomes regarding the SCS/ES dispute must first recognize the vast capability advantage that Beijing possesses relative to Hanoi. With a military far more advanced and with many more troops, China certainly will prevail in the event of a naval confrontation with Vietnam. Additionally, the CCP, with a relative power advantage in both economic and diplomatic capabilities is also able to shield itself from any attempt by Hanoi to punish it within these areas. Furthermore, as both the CCP and VCP are rational actors within one-party authoritarian states, strategic choice theory states that both actors primarily seek to preserve political power; as such, neither actor will be very likely to risk war with the other over this dispute for fear of losing power domestically. However, that is not to say that both states will cease to publicly rebuke each other; as both Hanoi and Beijing, seeking to sustain public support for their regimes will want to tap into the nationalistic tendencies of its respective citizens by appearing to be protecting the sovereign interests of their respective states. It is also likely that China will continue to increase its naval presence in the disputed waters for the reasons of showing off its enhanced military capabilities to Vietnam and others, as well as to measure American resolve in the region. What this paper has shown through the examination of the capabilities, strategies and preferences of both players—the CCP and the VCP—is that regardless of what each has said in public, both are most likely willing to settle for something much lower than their first, or even

31 The South China/East Sea Dispute: A Strategic Choice Analysis

second preferences regarding an outcome in the SCS/ES dispute. Specifically, some sort of joint governance and development pact will most likely be reached to resolve this dispute. The question though then is: what type of agreement will be reached, and by whom? Also, will there be numerous bilateral agreements between China and the other SCS claimants, or will there be one multilateral deal to settle the dispute? Moreover, it is uncertain what role multilateral organizations, such as the UN and ASEAN will play in its resolution. What is certain, however; is Vietnam‟s longing, and China‟s aversion to outside intervention, as this would shift each actor‟s relative bargaining power one way or the other. Yet some scholars are not convinced that a negotiated agreement for partial sovereignty will succeed. For example, Vietnam defense expert, Carlyle Thayer believes that although China will most certainly continue to press Hanoi to accept a joint-exploration pact for the SCS, such a policy will fail for the simple reason that Hanoi will not be able to sell such a deal to its own citizens, due to the intense nationalism that has been attached to the issue—many times exacerbated by the VCP themselves.64 Recognizing the lack of options available to Vietnam, stemming from its relative weakness with China, Hanoi does not have much bargaining space. As such, the VCP desperately needs to change the status quo, as current power dynamics in the SCS/ES leave Vietnam vulnerable to future punitive actions by China similar to 2009‟s fishing ban. As noted, Hanoi will hold the ASEAN chair in 2010, and will then have the capability to either reward or punish Beijing. In all likelihood, VCP will chose the former policy route to keep from rising tensions; that is of course, assuming China does not take a foolish action requiring Vietnam to retaliate from within ASEAN. What is clear is that Beijing will lose some autonomy over its SCS strategy during 2010, as its relations with ASEAN will be effectively controlled by Hanoi. Recommendations It is felt that both sides should resist the temptation to continue to use the SCS/ES dispute as a tool to incite domestic nationalism for their own political gains. Rather, what is needed by
64

Thayer, Carlyle, “Recent Developments in the South China Sea, International Workshop on The South China Sea Cooperation for Regional Security and Development”, Hanoi, 26-28 November 2009.

Craig Jeffries 32

both China and Vietnam is a refocus on engagement that is more than just fluffy rhetoric and empty gestures, but rather a serious and genuine dialogue, producing realistic goals and practical solutions to the dispute. Furthermore, both states must continue to enhance and build upon the DOC formula to ensure that is fair and equal to all sides—not just Beijing and Hanoi. Both states also need to agree not to take unilateral actions that risk escalation in the SCS/ES, as well as punish citizens who undertake actions that seek to inflame the situation. Finally, both China and Vietnam must be willing to utilize existing institutions and mechanisms to solve the dispute, and refrain from creating overlapping conferences, dialogues, roundtables and workshops that do nothing but seek to delay and hamper substantial progress—and are seen as nothing more than window dressing. Specifically, Beijing needs to realize that in order for its neighbors to truly be convinced of its “peaceful rise”, it needs to stop throwing its weight around, both diplomatic and militarily with regard to the SCS dispute. The best way for China to do this would be for it to enter into a multilateral dialogue with all SCS claimants. Conversely, Hanoi must accept that its current maritime claims are unrealistic; and that no matter how much international support it receives it will still be at the mercy of its more powerful northern neighbor. Therefore, Vietnam first has to adjust its claims, followed by entry into an authentic dialogue with both China and other claimants to discuss what steps are needed to truly achieve the shared peace and prosperity in the ES, which all sides claim to want.

33 The South China/East Sea Dispute: A Strategic Choice Analysis

Appendix A: Mechanisms employed be CCP
China's use of strategic tools during SCS dispute (2007-2009) Type of tools employed Target Areas Persuasion Reward Punishment Total Domestic (Politics) Diplomatic Economic Military Total * 4 0 1 5 1 2 0 2 5 0.8 0 0.2 1 0.2 0.4 0 0.4 1 5 2 3 10 1 5 5 1 12 0.50 0.20 0.3 1 0.08 0.42 0.42 0.08 1 5 2 5 12 2 5 3 3 13 0.42 0.17 0.42 1 0.15 0.38 0.23 0.23 1 14 4 9 27 4 12 8 6 30 0.52 0.15 0.33 1 0.13 0.40 0.27 0.20 1 *Some actions were identified as being directed at more than one target

Year 2007 (%) 2008 (%) 2009 (%) Total (%)

Appendix B: Mechanisms employed by VCP
Vietnam's use of strategic tools during SCS dispute (2007-2009) Type of tools employed Target Areas Persuasion Reward Punishment Total Domestic (Politics) Diplomatic Economic 6 0 1 7 4 5 0 0.86 0 0.14 1 0.44 0.56 0 3 2 0 5 2 2 1 0.6 0.4 0 1 0.4 0.4 0.2 7 2 1 10 3 8 1 0.70 0.20 0.10 1 0.25 0.67 0.08 16 4 2 22 9 15 2 0.73 0.18 0.09 1 0.35 0.58 0.08

Year 2007 (%) 2008 (%) 2009 (%) Total (%)

Military 0 0 0 0 0 0 0 0

Total* 9 1 5 1 12 1 26 1

*Some actions were identified as being directed at more than one target

Abstract: This paper will attempt to analyze the evolution of the Sino-Vietnamese relationship with regard to the South China Sea (SCS) /East Sea (ES) dispute. Utilizing the strategic choice approach this paper shows—using recent developments from 2007 to 2009—the extent of which both China and Vietnam‟s capabilities and resolve influence each state‟s actions, beliefs, and perceptions concerning overlapping maritime claims. Finally, this paper will gauge the likeliness of certain outcomes in the SCS/ES dispute, concluding with brief policy recommendations.

Craig Jeffries 34

Reference Notes
A copy of Vietnam and Malaysia‟s joint proposal can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/submission _mysvnm_33_2009.htm. A copy of Vietnam‟s partial proposal can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/submissionvnm_37_2009.htm. A copy of China‟s response can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/mysvnm33_09/chn_2009re_mys_vnm. A copy of Vietnam‟s reply to China can be found at: http://www.un.org/Depts/los/clcs_new/submissions_files/mysvnm33_09/vnm_chn_2009re_mys.

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