Saturday, November 29, 2014

Vietnam, the US, and Japan in the South China Sea

Prospects for regional security hinges heavily on how these actors relate to the South China Sea issue.

Between May and July 2014, China unilaterally deployed a giant drilling rig in waters claimed by Vietnam as its exclusive economic zone (EEZ). The move led to a fierce confrontation between Chinese and Vietnamese government vessels and saw relations between the two countries deteriorate to their lowest point since 1988. The standoff also served as a litmus test to identify who will side with whom in this conflict. While most of the world remained neutral, several states came out in support of Vietnam in one form or another. Among these supporters, the United States and Japan stood out as the most powerful and staunchest.
The fault line between Vietnam, the U.S., and Japan on one side and China on the other can be seen as one between status quo and revisionist powers. The former share the same objective of maintaining the balance of power that has kept the region in peace for the last two decades. China, with its long period of rapid economic growth in the last three decades, appears to be determined to use its newfound power to assert its sovereignty claims, which in end effect would amount to its dominance of the region. The prospects for regional security hinges heavily on how these actors relate to the South China Sea (SCS) issue.
The Stakes
The prevailing narrative portrays the SCS issue as a territorial dispute driven by conflict over natural resources between the littoral states. This provides a very truncated picture that fails to illuminate the identity and motives of the stakeholders. Besides its economic value, the SCS also has an enormous strategic value for several countries and an increasing symbolic value for some of the disputants.
China claims a vast area of the SCS that lies within a unilaterally drawn U-shape line as its own territories and waters, while Vietnam claims sovereignty over the Paracel and Spratly Islands and the EEZ and continental shelf surrounding its mainland’s coasts. The SCS is believed to be rich in fish stocks, energy reserves, and mineral ores. Some estimates put the oil and gas reserves in the SCS at about 80 percent of Saudi Arabia’s. With roughly ten percent of the world’s catch, the region also has one of the largest fishing stocks in the world.
The SCS constitutes one of the inner seas that lie within what China’s strategic planners and analysts term the “first island chain.” Offering easy access to the industrial centers of the country, these maritime zones are critical to the defense of the Chinese homeland against invaders coming from the seas. The SCS is even more important to the defense of Vietnam. If it is sometimes likened to China’s backyard, it is literally the front door to Vietnam.
The SCS has strategic value not only for the littoral states but also for other regional and major powers from outside. The shortest shipping routes between the Indian and the Pacific Ocean, the sea lines of communication that pass through the SCS carry nearly one-third of world trade and a half of the global oil and gas shipping. Not only the economies of Southeast Asia but also those of Northeast Asia are heavily dependent on these trading routes. About 80 percent of the oil and gas imports of China, Japan, South Korea, and Taiwan are shipped through the SCS.
While all players in the SCS issue share a large stake in its waterways, powers with hegemonic ambitions such as the United States and China have an additional interest based on the strategic value of those sea lines. Given its location as a chokepoint on the Asian lifeline and one of the global arteries, control of access to the SCS is a sine qua non for naval supremacy in the Western Pacific, which in turn is a critical pillar of regional primacy in East Asia.
Besides its economic and strategic value, the SCS also has an enormous symbolic value for China and Vietnam. Conflicts and stakes in this region have made it a strong symbol of identity for both nations. Vietnam, for example, has declared the Paracel and Spratly Islands to be its territories in the new constitution of 2013.
Vietnam’s Strategies
No single strategy can describe how Vietnam is dealing with the SCS issue. Instead, Vietnam pursues a multitude of approaches that employ a wide range of mechanisms stretching from hard to soft power. At least seven distinct strategies can be identified.
At the hard extreme of the spectrum, Vietnam tries to strengthen its presence and forces, both military and non-military, in the SCS. During the “scramble for the Spratlys” in 1988, when Beijing and Hanoi competed for foothold on the Spratly Islands, Vietnam set up permanent military garrisons on 11 land features in the archipelago, increasing its possessions here from 10 to 21 land features. From 1989 to 1991, Vietnam went out to occupy six underwater shoals on its continental shelf southwest of the Spratlys by putting up permanent high-pillar structures and manning them with garrisons. Slowly but surely, Vietnam continues to consolidate and increase its presence in these areas with more troops, facilities, equipment, and civilians. Since 2007, Vietnam started to populate the largest of its possessions in the Spratly Islands with permanent civilian habitants. Taking a leaf out of China’s playbook, Vietnam decided in 2012 to create a fisheries surveillance force as a third force, after the navy and the coast guard, to patrol its maritime waters, and in 2014, after the oil rig crisis, to lightly arm these vessels. To build a minimum deterrent force on the sea, Vietnam continued to modernize its navy and air force. A key element in this deterrent force is a submarine fleet it is building with six Kilo-class vessels.
Vietnam is well aware that it cannot rely on military force alone to deter China. One strategy to compensate for this deficit is to get powerful third parties involved. Vietnam’s application of this strategy is, however, limited to the oil and gas industry in the SCS only. But perhaps Hanoi has no other option but to give concessions in the oil blocks that lie within China’s U-shaped line to large companies from major powers, something it has done so far to ExxonMobil from the United States, ONGC from India, and Gazprom from Russia. The extent to which Vietnam has limited its pursuit of this strategy is remarkable; it has repeatedly pledged that it will not form an alliance with any other country against a third party, a coded statement to reassure China of Vietnam’s non-aligned posture.
Instead of forming alliances with powerful partners, Vietnam places more emphasis on internationalization of the issue to interlock and deter China. During most of the 1990s and 2000s, Vietnam remained largely modest in its attempt to internationalize the SCS issue. But responding to Chinese assertiveness in the region since 2008, Vietnam has become increasingly proactive and determined to bring the issue to the world’s attention and enlist the support of foreign partners. For example, international conferences on the SCS issue have become a thriving industry in Vietnam since 2009. Hanoi has also tried to include the SCS issue as an agenda item in its talks – and as a rhetorical device, in the joint statements – with most other foreign governments. Starting with the ASEAN and ARF meetings, international forums such as EAS, APEC, the UN, and ASEM have become diplomatic battlegrounds for Vietnam over the SCS dispute.
Vietnam’s effort to internationalize and multilateralize the issue does not come at the expense of its bilateral dialogues with China. Not only does Vietnam take advantage of all possible channels to talk with China, it is also proud of being able to maintain those channels. Besides the government-to-government channel, Vietnam also cultivates ties between the two Communist Parties and the two militaries to keep special access to China. The uniqueness of the party-to-party and the military-to-military relations between Vietnam and China lies in the fact that both sides emphasize their ideological bonds and, particularly for the militaries, their common interests in opposing the West. With regard to negotiation to resolve the territorial disputes, Vietnam accepts a bilateral approach to the Paracel Islands while insisting on a multilateral approach to the Spratly Islands, arguing that the multilateral nature of the dispute over the latter requires multilateral negotiation.
Toward the soft end of the spectrum, self-restraint and self-constraint to reassure China is also a key element in Vietnam’s approach to the SCS. Hanoi’s political leaders and military strategists reason that China, mindful of its superior forces, will seize the moment when Hanoi lets itself be provoked to escalate the conflict and overwhelm Vietnam. But for Hanoi, self-restraint and self-constraint are not only a tactic to avoid being provoked; they are a systematic approach based on the belief that it can convince Beijing of Hanoi’s benign intentions. Hanoi has, for instance, tried to erase public memories of Vietnam’s military conflicts with Communist China, both on the land borders and in the SCS during the 1970s and 1980s. To reassure Beijing, Hanoi has also unilaterally set tight limits on its room of action. One example is its “three no’s” policy, under which Vietnam vows not to participate in any military alliance, not to allow any foreign military bases on its soil, and not ally with any other country against a third country.
Softer than self-restraint, deference is also a principal element of Vietnam’s strategy toward China. Many Vietnamese leaders and strategists argue that combining resistance with deference is key to Vietnam’s ability to survive in China’s shadow for thousands of years. Acts of deference signaled Vietnam’s acceptance of its subordinate position to China in a hierarchy of states, and Hanoi continues to show deference to Beijing. Two recent examples include visits to China by Foreign Minister Pham Binh Minh and Defense Minister Phung Quang Thanh in the wake of the oilrig crisis. Minh used a trade fair in Nanning, China to go to China before traveling to the United States in September 2014. In October, Thanh led a delegation of thirteen high-ranking military officers to China, preceding the long-planned visit to Vietnam by the U.S. secretary of defense in November.
While preparing for the contingency of a military showdown with China in the SCS, Vietnam hopes that ideological bonds will prevent the worst and serve to isolate, compartmentalize, and attenuate the conflict. Predicated on solidarity between the two communist regimes, this strategy enjoys powerful support among the military leadership and Communist Party conservatives. The underlying thinking is best articulated by General Le Van Dung, then-head of the Political General Directorate of the Vietnam People’s Army. In an interview in December 2009, Dung said: “As concerns our issue with China in the East Sea, we are trying our best to resolve it, and in the near future we will be discussing, negotiating, and delimit the maritime borders with our friend. So the situation will be gradually stabilized and we keep strengthening our relations with China in order to fight the common enemy.” Although China’s increasing assertiveness in the SCS, most notably its deployment of the HSYS-891 drilling rig in Vietnamese waters during the summer of 2014, has shattered much of Vietnam’s trust in Beijing, the military leadership in Hanoi continues to cling to solidarity as a strategy to deal with Beijing and the SCS issue.
None of these strategies has been pursued to its fullest capacity, and the intensity and scope with which they have been practiced has varied over time. For most of the period between 1990 and 2008, Vietnam did little to internationalize the issue. The strategies most salient during this period were a gradual and low-key consolidation of presence and forces, self-restraint and self-constraint, and solidarity. The rising tide of tensions since 2009 has changed the intensity and scope of Vietnam’s strategies, with a focus now on strengthening of presence and forces and internationalization. Overall, Vietnam’s approach to the SCS issue combines deterrence with reassurance. While having stabilizing effects, this “hedging” approach has its own problems: Combining deterrence and reassurance undermines the credibility of both. With the increasing tension in the last few years, this hedging approach has proven increasingly ineffective, creating growing frustration with the policy.
The U.S. Commitment
The United States stands out among outside stakeholders to the SCS with its intense interest in the region. Since 2010, American leaders have repeatedly declared that Washington has a “strong national interest” in freedom of navigation and a “strong interest” in the peaceful and lawful settlement of the disputes there. Both the U.S. economy and U.S. global power and regional primacy in the Asia-Pacific depend to various extents on freedom and peace in the waterways running through the SCS.
In fact, the impact of a blockade in the SCS on the U.S. economy would be significant but not extremely high. Less tangible but more important is the role of the SCS for U.S. global power. U.S. naval supremacy in the Western Pacific, of which the SCS is a critical part, is a key to its regional primacy in the Indo-Pacific, which in turn is a major pillar undergirding the U.S.-led liberal world order. Important as it is, this link from the SCS to U.S. interests is not direct and not very visible and tangible. This fact makes it harder to convince the American public of the significance of the SCS to their interests.
American commitment to the SCS is limited by the U.S. need for breathing space after two expensive wars and a severe economic crisis. China has acted to take advantage of this virtual power vacuum, intensifying its revisionist actions in the region. However, as those revisionist actions become more visible to the American public, U.S. commitment to this critical region may once again strengthen.
Japan’s Role
Japan’s interests in the SCS derive primarily from its dependence on the waterways there and its preference for a U.S.-led regional order. If China dominates this chokepoint, it will be able to switch off at will about 60 percent of Japan’s energy supplies, and it will likely replace the United States as the sponsor and leader of a new regional order. A Chinese-led regional order will most likely be far less liberal and favorable to Japan than the current U.S.-led order. Japan thus shares with both the United States and Vietnam a strong interest in maintaining the status quo in the region. What role can Japan play in maintaining stability in the SCS?
First, Japan – and the United States, for that matter – is ill-suited to act as an honest broker to the dispute. The honest broker must be trusted as such by both sides of the dispute, and Japan hardly fits that bill with China, particularly given its own dispute with China in the East China Sea.
Second, Japan is unable to play the role of an external deterrent. Lacking nuclear weapons and perhaps more dependent on China economically than vice versa, Japan is simply unable to deter China in general.
Balancing, therefore, remains the only possible role for Japan to play. Japan is willing to support Vietnam against China, as evidenced byTokyo’s provision of coast guard ships as gifts to Vietnam during its oilrig crisis with China recently.  But does Japan, even when joining forces with Vietnam, have the capacity to balance China? This is an interesting question that needs more study, but a look at the combined military and economic power of the two suggests that they cannot. China possesses several key advantages over a Japan-Vietnam coalition, most obviously its nuclear weapons and its central role in Asia’s economy.
The most effective role for Japan to play in the SCS is to facilitate a coalition with the United States, Vietnam, the Philippines, and other countries that share a common interest in maintaining the status quo. Only a U.S.-led coalition can balance Chinese power in the region. Given its high stakes in the SCS – and the perception of those stakes by its elites – Japan is likely to be willing to play this role. But there is an issue with the coalition leader: With its geographic and psychological distance to the SCS, Washington may be the least willing among this coalition’s members. This may be a factor that prevents the coalition from unilaterally escalating the conflict, but it may also be a factor that encourages China to underestimate the resolve of its rivals and become dangerously provocative.
That in turn suggests the potential for a new era of instability and tension in the SCS, with each stakeholder playing their own role.
Alexander L. Vuving is an associate professor at the Asia-Pacific Center for Security Studies in Honolulu. The views expressed in this article are the author’s own and do not necessarily reflect those of the Asia-Pacific Center for Security Studies, the U.S. Department of Defense, and the U.S. Government.

Thursday, November 20, 2014

Q&A: Peter Navarro on America's Death by China

Workers on a production line at a toy factory in China
Photograph by AFP/Getty
Workers on a production line at a toy factory in China
Bloomberg Businessweek speaks with Peter Navarro, a business professor at theUniversity of California, Irvine, about his new documentary Death By China. The film, based on the eponymous book he co-authored with Greg Autry in 2011, opened in Los Angeles on Aug. 17 and comes to New York on Aug. 24. Reviews have described it as “a lucid wake-up call” and criticized it for being “heavy handed” and containing “xenophobic hysteria.” Navarro reponds, “The film accurately depicts the devastation China’s unfair trade practices are having on Americans. Critics giving bad reviews should get out into the heartland of America more. Viewers are deeply moved by the film if our L.A. opening is any indicator.”
Poster for the movie 'Death By China'Poster for the movie 'Death By China'
Death By China. That’s a pretty grim prognosis. Is China killing us?
We’re billing this as the feel-good movie of the year. [Laughs.] There’s nothing subtle about what’s happening. It’s an economic death because of China’s unfair trade practices and the loss of the U.S. manufacturing base. Also, literal death because of the loss of consumer safety: toothpaste, baby formula, a dizzying array of products. There are also human rights abuses—China’s forced labor camps. There’s a chilling discovery in the film about how people are being taken out of labor camps and their organs are harvested. Also, the military buildup of China. It’s an evocative title, yes, and it has multiple meanings.
Is it about declining U.S. dominance?
That would be jingoistic. It doesn’t matter to me who’s the most powerful or profitable country in the world. All countries want to be prosperous. What’s happening is a zero-sum game between China and the U.S. where their gain is our loss. It’s about the fact that we don’t make things any more, that we lost our manufacturing base, the 25 million people who can’t find a decent job in this country, the zero wage growth. I want consumers to connect the dots, to go to any store and look at the label and connect the dots between buying cheap China products, which is better for the wallet, and all the other things we lose, like jobs.
Some would argue that the U.S. shifting away from a manufacturing economy to a knowledge- and service-based economy is a good thing.
The best counterfactual argument to that is Germany. Germany is one of the strongest, most stable economies, and 25 percent of their workforce is in manufacturing, compared with 9 percent in the U.S. The service-sector opium they tried to sell us in 1990s and early 2000s hasn’t worked. Manufacturing is the seed corn for other jobs in the U.S.
Would you call yourself a protectionist?
The way that my view on this is often derided is using the P word. It’s a very inflammatory word in my profession. There’s a big difference between self-defense against unfair trade practices and protectionism. The biggest protectionist in the world now is China. If you want to go into China now, you can’t without a joint venture Chinese partner, and you have to give them your tech. The logical result of that is they take your IP and then you’re obsolete. This is not protectionist; it’s self-defense against a very mercantilist trading partner.
Is calling you a Democrat just as inflammatory? 
The greatest compliment is I am accused of being a Dem leftie and a Republican righty. I am a pragmatist. I call it as I see it. This country needs more of that. I am a Democrat. I ran for Congress in 1996 as a Democrat. Both parties have failed us in the same way. We’re really careful in the movie to make this a nonpartisan issue. It’s an American problem, not a Democrat or Republican issue.
When was the last time you went to China?
I went back just before the release of the Coming China Wars in 2006. Once I wrote that book … it’s dangerous for me to go back there. My co-author Greg Autry was followed, and they searched his room. Some think this movie is too strong, but it’s not. It’s a serious national security issue. I don’t go back to China. I understand the country at some level. And a lot of my colleagues are wined and dined, but it’s Beijing and Shanghai, and that’s it. You have to get out in the countryside to know what’s going on.

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