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South China Sea: More Than Just Exotic

To China, control of its oil reserves is vital

Mention of the South China Sea - a body of water washing Malaysia, the Philippines, Vietnam, and Brunei - conjures up images of exotic climes. On a more practical level, more than 90 percent of Japan's energy supplies sail through the South China Sea. Nevertheless, whether viewed from an exotic or practical viewpoint, such descriptions ignore the most significant force for change in that area and the serious impact on the United States.

That likelihood of change comes, of course, from China. Not too surprisingly, China claims a substantial segment of the body of water bearing its name. The UN-sponsored Law of the Sea Treaty, however, gives each maritime nation a very substantial claim over its adjacent ocean waters. Especially in the case of China, it turns out that those claims overlap much of the water space that the other countries in Southeast Asia also claim.

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It is helpful to understand the pressures that are driving China to take an active interest in some unattractive geography, especially the 60 Spratly Islands (or Nansha Islands, as the Chinese call them). The rapid expansion of the Chinese economy - by some estimates it is now the third largest in the world, just behind Japan - is generating new requirements for energy that can't be met from current domestic sources.

The long-neglected oil reserves at the bottom of the adjacent ocean have become a vital strategic concern. The value of the petrochemical deposits surrounding the Spratlys has been projected at more than $1 trillion. Estimates of recoverable oil range widely, from 11 billion to almost 160 billion barrels. Not too surprisingly, China considers control of the South China Sea essential to its future.

A considerable naval expansion is under way in each of the nations in the area. China has been acquiring amphibious assault ships, missile frigates, and destroyers - items that are key to the projection of naval power. In addition to its long-range ballistic missiles, China possesses a force of about 200 bombers that supposedly also can deliver nuclear payloads. No other country in the area begins to possess such strategic capability.

Other Southeast Asian nations have responded. Taiwan has ordered six frigates from France and is building eight more under license from the United States. Thailand is constructing new air and naval facilities on its southeastern coast, giving it a greater military presence in the South China Sea. Indonesia has purchased 39 naval vessels formerly owned by East Germany. Singapore is building five corvettes under license from Germany, and Malaysia has ordered two missile frigates from Great Britain.

Beijing has declared that it will not use force to settle disputes in the area, yet it has not hesitated to flex its muscles. In 1988, China invaded seven islands controlled by Vietnam, killing 70 Vietnamese soldiers in the process. The following year, the Chinese Navy engaged Vietnamese merchant vessels, forestalling any reinforcement of Hanoi's claim to the islands.

In January 1992, China sent 132 officials to make a circuit of the Spratly archipelago. They posted claim plaques on the major islets, atolls, and sand banks. Later that year, China's National People's Congress issued the "Law on the Territorial Waters and Their Contiguous Area," laying claim to 80 percent of the South China Sea. Included in this area is the Natuna gas field, controlled by Indonesia.

The military buildup of China and its neighbors is a reminder that - despite the economic progress made in recent years - military strength continues to be an essential element of foreign policy. A serious territorial dispute in the South China Sea could provide the spark to ignite a regional conflagration. As the dominant Pacific power, the United States might find it hard to stay aloof. Serious contingency planning on our part is warranted. The South China Sea is no longer merely an exotic locale.

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Murray Weidenbaum is chairman of the Center for the Study of American Business at Washington University in St. Louis.

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