Thayer Consultancy

ABN # 65 648 097 123

Background Briefing:
South China Sea: Want the
Minnows Want
Carlyle A. Thayer
June 16, 2011

[clientnamedeleted]
1.Inyouranalysis,whydoesVietnamchoosethisoccasiontoholdamilitaryexercise
toescalatetheSouthChinaSeadisputation?SomeanalystssayVietnamissuffering
economic problems and the government wants to use this topic to calm down
domesticresentment.Whatisyouropinion?
ANSWER: Vietnam made its announcement that it would conduct naval livefiring
exercises after three developments in China. The first was the announcement that
thenewmegaoildrillingrighadbeenturnedovertotheChinaNationalOverseasOil
Company and would be placed in the South China Sea in July to commence work.
Second, the Chinese Ambassador in the Philippines warned Southeast Asian
countriestostopexploringforoilwithoutpermissionfromtheChinesegovernment.
Third, China announced that it would be conducting normal naval exercises in
international waters in the western Pacific at the end of this month. All three
developments followed two serious incidents in which the cables of Vietnam oil
explorationvesselswerecutinincidentsinvolvingChinesevessels.
China has not officially commented on the livefiring exercises because that would
open itself for criticism for conducting similar exercises in 2010. It is the sovereign
rightofbothcountriestoconductmilitaryselfdefenceactivitiesintheirterritory.In
thiscontextIdonotthinkitfairtocharacterizeVietnamsactionsasanescalation.
Theexercisestookplaceina40kilometerstretchofwaterfromVietnamscoastto
theHonOngisland.Theexerciseinvolvedcoastalartilleryandnavalgunfirebutnot
missiles. There was no press coverage. The exercises were not held even remotely
close to where the two cable cutting incidents occurred. They also took place in
watersthatarenotindispute.
But this was the first time Vietnam announced it would be conducting live firing
exercises.OfcoursetheimplicationisthatVietnamwassendingamessagetoChina
should current tensions over the South China Sea result in conflict, Vietnam is
preparedtodefenditself.Itisbetternottoexaggeratetheseexercises.Vietnamwas
alsosendingamessagetoitsownpeople.AsyouknowantiChinademonstrations
were held on two consecutive weekends in June. The Vietnam government was
signaling that it is taking steps to protect national sovereignty. The live firing
exerciseswerenotadiversionfromVietnamseconomicproblems.

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2. In your analysis, what is Vietnams purpose to escalate the disputation? What
resultdoesitwantintheshortterm?
ANSWER:China,VietnamandthePhilippinesarelockedinadisputeoverterritoryin
theSouthChinaSea.VietnamisreactingtoChinasunilateralimpositionofits9dash
lineUshapedmapclaimingindisputablesovereigntyovertheSpratlyIslandsand
surroundingwaters.ChinasclaimdoesnothavethesupportofanystatethatIam
aware.Chinasclaimisinfactdisputable.Chinascoastlineistoofarawayforitto
claima200nauticalmileExclusiveEconomicZone.Chinaoccupiesrocksnotislands
intheSouthChinaSeaandrockshavenobasisininternationallawtosupportthe9
linesdrawnonChinasmap.Chinas9dashmarklinescutdeeplyintotheExclusive
EconomicZonesthatVietnamandthePhilippineshaveclaimedbasedontheUnited
Nations Convention of Law of the Sea (UNCLOS). China refuses to clarify how the
ninedashmarklinesareconnectedandwhatitisthatChinaisclaiming.
Chinese actions to assert its sovereignty has resulted in three major incidents in
whichtheoperationsofoilexplorationvesselshavebeeninterferedwith.Chinahas
reacted to complaints and diplomatic protests by the Philippines and Vietnam by
dismissingthem.Chinahasnotofferedtoinvestigatetheseincidents.Chinasactions
have led to the Philippines to shift funds to modernize its armed forces with an
emphasis on territorial defence of its maritime waters. The Philippines has bought
naval ships from the United States and Taiwan and it is looking to buy more.
Vietnamshasbeenmodernizingitsarmedforceslongbeforethecurrenttensions.
What do the Philippines and Vietnam want? They would like the right for the
Southeast Asian claimant states all of whom are members of the Association of
SoutheastAsianNations(ASEAN)tomeetasagrouptoreachacommonposition
on territorial disputes in the South China Sea. They would then like to enter into
discussions with China to adopt effective guidelines to implement the 2002
Declaration on Conduct of Parties in the South China Sea and to carry on
negotiationstoadoptamorebindingCodeofConduct.
3. Why does Hanoi prefer a multilateral approach to the South China Sea
disputation?Whatwillitgetfromthisapproach?
ANSWER: Vietnam along with the Philippines, Malaysia and Brunei all prefer a
multilateralapproachbecausetheyareallmembersofASEAN.Theydonotwantto
seeChinanegotiateseparatebilateralagreementsandusedifferencesinthetextof
these agreements to their disadvantage. These states take note that China has
entered into several multilateral agreements with ASEAN it signed the Treaty of
Amity and Cooperation, ChinaASEAN Strategic Partnership, the ASEANChina Free
TradeAgreementandtheDeclarationonConductofPartiesintheSouthChinaSea.
Vietnamandtheotherclaimantstatesfeeltheywillachieveanequitableagreement
withmutualbenefitforalliftheynegotiatewithChinamultilaterally.
4.U.S.StateDepartmentspokesmanMarkTonersaid:"Wedon'tsupportanything
thataddstoraisingthecurrentleveloftension;wedon'tthinkit'shelpful."Whatis
your analysis on U.S. attitude towards Vietnams action? In U.S. opinion, what
shouldVietnamdo?

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ANSWER: The United States would like to see both Vietnam and China stop taking
actions that increase bilateral tensions and tensions in the South China Sea. The
UnitedStateswouldliketoseethatbothVietnamandChinaresolvetheirterritorial
disputes in accord with international law including UNCLOS. The United States
supportstheASEANmechanismtheDOCasabasisforacodeofconduct.ThisUS
hasnotcriticizedVietnamslivefiringexerciseandthenavalexercisesthatChinais
about to undertake because these do not violate international law and do not
representathreattoregionalpeaceandstability.
The United States has no treaty alliance with Vietnam and in private no doubt
supports Vietnams efforts to build up its military capabilities to protect itself and
exercise sovereignty over its territorial water, exclusive economic zone and
continental shelf. Strong states contribute to regional stability, weak states
undermineregionalstability.
5. How far will U.S. want to pursue strategic and militarytomilitary ties with
Vietnam?Why?HowimportantisVietnaminU.S.regionalstrategy?
ANSWER: The US Quadrennial Defense Review identified Indonesia, Malaysia and
Vietnamaspotentialstrategicpartners.TheUSwouldliketodevelopclosermilitary
tiestoaddressarangeofregionalsecurityissuesfromhumanitarianassistanceand
disaster relief, counterterrorism and nonproliferation of weapons of mass
destructionandtheirmeansofdelivery.TheUSwouldliketoassistVietnambuildup
itscapacitysoitcancontributetointernationalpeacekeepingunderUNauspices.All
oftheseactivitiesareaimedatbuildingtrustandconfidencebetweentheirmilitaries
toparallelpoliticalandeconomicrelations.
Vietnam is important to the US because it is an emerging regional power that has
demonstrated leadership both as a nonpermanent member of the UN Security
CouncilandasChairofASEAN.AsVietnamseconomygrowsitcanbeexpectedto
playamoreprominentroleinregionalaffairs.
ItshouldbemadeclearthattheUSisnotseekingmilitarybasesinVietnambutin
the long run would be seeking access to facilities to support US regional
engagement.TheUSisalsonotseekingtoenlistVietnamtocontainChina.
6.AndwhataboutVietnamconversely?HowdoesVietnamthinkaboutU.S.valueas
astrategicpartner?Willitconquerthehistoricaldistrust?
ANSWER:VietnamhighlyvaluestheroleoftheUSasastrategicpartner.Toputthe
mattersimplistically,VietnamhasaUS$13billiontradedeficitwithChinaandaUS
$9billionsurpluswiththeUnitedStates.Vietnamneedsbothrelationships.
But Vietnam also values the role of other major powers such as Russia, India, and
Japan. Vietnam does not want to become dependent on one major power and
neitherdoesitwanttoseeanymajorcountrydominateSoutheastAsia.Atthisstage
of its development Vietnam does not see the US as a major source of military
equipment.VietnamisdependentonRussiantechnologyandUSdefenceequipment
isveryexpensive.
Since 2003, and more particularly after the eleventh national congress of the
Vietnam Community Party earlier this year, Vietnam has been removing its

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inhibitions about developing defence and security ties with the United States.
Chinese readers might find it ironic that for many years Vietnam refrained from
advancingitssecuritytieswiththeUSoutofconcernforhowChinawouldreact.
TheUSVietnamdefencerelationshipismodest.WhileVietnamhasconductedjoint
patrolsandexerciseswiththeChinesenavyintheGulfofTonkin,ithasnotyetdone
so with the US. The US makes annual port visits but Vietnam has kept them quite
restricted.LastyearwhentheUSdestroyerUSSJohnMcCainvisitedVietnamsome
sectionsoftheChinesemediaprintedstoriesthatweremisleading.Vietnamandthe
USdidnotconductnavalexercises,theyonlyconductedtheirfirstnavalactivities.All
oftheseactivitieswereconductedwhiletheJohnMcCainwasberthedintheportof
DaNang.Theseactivitiesincludedafirefightingdrill,atabletopsearchandrescue
exercise,andtheexchangeofcookingrecipes.

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