Australia and the South China Sea: debates and dilemmas

Dr Cameron Hill, Foreign Affairs, Defence and Security

Key Issue
Intensifying disputes in the South China Sea present an acute challenge to Australia’s key interests and relationships in the Indo-Pacific.

The South China Sea disputes have entered a dangerous new phase in the last several years. Alongside China’s unprecedented construction and fortification of artificial features, incidents at sea involving clashes between various combinations of fishermen, coast guards and, occasionally, naval assets, are occurring on a routine basis. With the nationalist credentials of authoritarian and democratically-elected claimant governments at stake, the potential for miscalculation and escalation (whether inadvertent or intended) is growing. 

Australia’s aspirations for a viable ‘rules-based’ strategic order in the Indo-Pacific are under significant pressure as regional powers contest the very nature and scope of these rules via the disputes. Key Australian interests and relationships are being tested.  

China: a revisionist power?

As Australia’s largest trade partner since 2007, China’s rise and pursuit of its ‘legitimate interests’ have been supported by successive Australian governments. A key question emerging from China’s recent actions in the South China Sea is where do these ‘legitimate interests’ begin and end—do they include the establishment of ‘spheres of influence’, the revision of existing regional and global norms, and the right to resort to unilateral action to achieve these ends? From Beijing’s perspective, these are all strategic behaviours that have been exhibited by previous great power aspirants, including the US.

Whether coming to terms with China’s rise should involve an element of genuine strategic ‘accommodation’, as opposed to simply ‘engagement’, is a question that Australian policymakers often appear reluctant to publicly canvass. In response to recent Chinese actions in the South China Sea, Australia’s current strategy might be best described as one of ‘dissuasion’—working with others to convince China of the costs of unilateral actions, while simultaneously using engagement to reinforce the benefits of the existing, US-led regional order.

Even though the pay-offs thus far might appear slight, the alternatives are perhaps even less appealing. Whether this calculus would hold in the face of even more forceful Chinese actions—such as Beijing proclaiming an Air Defence Identification Zone in the South China Sea—or provocative moves by other claimants, remains to be seen.

United States: ‘abandonment’ or ‘entrapment’?

The longstanding alliance with the US is routinely invoked as the foundation of Australia’s security. The South China Sea disputes have forced a sharper consideration of the benefits and risks of the alliance and the conditions under which these could manifest. This has been most prominent in debates surrounding whether Australia should replicate several recent ‘freedom of navigation operations’ (FONOPs) undertaken by the US Navy through the contested waters; in particular, whether Canberra should authorise naval FONOPs within the 12-nautical-mile limit of China’s newly constructed artificial islands. China has recently intensified warnings of ‘serious measures’ should Australia seek to challenge Beijing’s claims though naval operations.

The FONOPs debate reflects a dilemma common to all alliances—the alternating anxiety between the fear of ‘abandonment’ by an ally in the event of a conflict, versus the fear of ‘entrapment’ in an ally’s conflict that is contrary to one’s own interests. Whilst some argue that Australia’s interests demand FONOPs of the kind conducted by the US, others counter that such actions could draw the ire of China, with whom Australia also seeks to maintain a good relationship.

These anxieties persist. The result has been a form of ‘strategic ambiguity’ in which Australia has communicated its intention ‘continue to traverse the water and the skies around the South China Sea in accordance with international laws’ without saying whether it would breach the limit of any claimed Chinese boundaries. Again, whether this position could withstand a significant escalation of the conflict remains to be seen.                 

ASEAN: a house divided?

Efforts by the Association of Southeast Asian Nations (ASEAN) to engage both China and the US in multilateral institution-building through venues such as the East Asia Summit are a key focus of Australia’s diplomatic and strategic planning. However, the failure to produce a long-awaited ‘code of conduct’ for managing the disputes bodes poorly for multilateralism. Indeed, some contend that China has deliberately delayed the code in order to ‘buy-off’ non-claimants such as Cambodia and Laos through increased aid and investment while ramping up construction in disputed areas.

There is now a view that ASEAN is irrevocably split on the South China Sea disputes following several recent failures to agree on consensus language. In the face of these divisions, some ASEAN claimants have resorted to appeals to international arbitration (which China says it will not abide by), as well as more traditional power balancing strategies—upgrading alliances and military cooperation, and intensified acquisition of advanced maritime weaponry. 

A former senior Australian official has warned that ‘it is not in Australia’s interest for ASEAN to be divided into different camps’. ASEAN’s inability to collectively endorse the international Permanent Court of Arbitration’s July 2016 ruling against China’s claims has prompted some experts to argue that the organisation must reform its emphasis on consensus-based decision-making.

Looking ahead...

Facing difficult choices in its relations with China and the US and the prospect of a divided ASEAN, Australia is likely to pursue complementary initiatives to advance its maritime security interests. These could include intensified ‘mini-lateral’ cooperation with other non-claimant states such as India, Japan, Singapore and Indonesia, all of whom share misgivings about China’s ambitions and actions. Indonesia will likely be a focus given Jakarta’s increased concerns with recent Chinese incursions into its maritime domain. Australia may also face continued calls to reconsider its approach to its maritime border issues with East Timor. In the meantime, the risk of conflict continues to rise.

Further reading

US Center for Strategic and International Studies, Asia Maritime Transparency Initiative, website.

B Hayton, The South China Sea: the struggle for power in Asia, Yale University Press, 2014.


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