South China Sea: between US-China tensions and Asean disputes, a code of conduct remains out of reach

For code negotiations to succeed, the US must refrain from interfering behind the scenes, while Asean members must commit to resisting China’s influence. However, this all looks unlikely

Mark J. Valencia

Published: 9:15am, 8 Nov 2022

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A senior US State Department official recently warned that the United States will oppose any effort to exclude it from the South China Sea through provisions in a code of conduct being negotiated. This is just the tip of the iceberg of the US-China struggle over the code and, more fundamentally, regional dominance.

Asean and China have been negotiating a code of conduct since the idea was first endorsed in 1996 by the Association of Southeast Asian Nations. It seems to have become a holy grail – sought after but never obtained. Indeed, an early October meeting of the parties’ working group seems to have made little progress.

So, what are the sticking points and where are these negotiations likely to lead?

There is already a regional order in the South China Sea. It is based on the UN Charter, the Convention on the Law of the Sea (UNCLOS), the Treaty of Amity and Cooperation in Southeast Asia, the Declaration on the Conduct of the Parties in the South China Sea, and various other treaties and practices, bilateral boundary agreements, and others. The problem is that these are more honoured in the breach than the observance.

The hope is that a robust and binding code of conduct will reinforce the fundamentals and mitigate, even prevent, the breaches. But negotiations have been stymied by a tangled nesting of security dilemmas.

The overarching conundrum is the US-China struggle for regional dominance. It has influenced negotiations for a code of conduct and split Asean. The US and its supporters want a robust, binding and enforceable treaty, with compulsory arbitration mechanisms and language to deny China’s historic “nine-dash line” claim.

China and its supporters prefer a looser arrangement with emphasis on the provision in the Declaration on the Conduct of the Parties (DOC) that disputes are settled through friendly negotiations between the states directly concerned, and not third parties.

The US wants to be a party but China insists membership is only for the region. China has, in the past, proposed clauses to exclude foreign military exercises and companies from the region unless all parties approve.

The next level of the security dilemma revolves around China and the Southeast Asian claimants. They want China to relinquish, or at least not enforce, its historic claim. But China wants its claim recognised in some fashion, perhaps at least by having a share of the resources in the Southeast Asian claimants’ exclusive economic zones.

China wants the DOC fully implemented first – in particular the provision that disputes be resolved by direct negotiations between the states concerned. But others, like the Philippines, have shown a willingness to use third-party mechanisms.

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Implementing the DOC would also mean avoiding any activity that could complicate or escalate disputes. But all parties repeatedly violate this provision and blame each other for doing so.

A sticking point for the code of conduct is that Vietnam wants it to cover the Paracel Islands, but this is a non-starter for China, which also claims the islands. So, negotiations are hung up on the code’s geographic scope.

There is also disagreement between Asean members, including serious disputes such as between Malaysia and the Philippines, whose overlapping exclusive economic zones and continental shelf claims involve their conflicting sovereignty claims to Sabah.

The question is whether this political Gordian knot can be peacefully untangled. First there must be agreement to separate out the territorial disputes to focus on the jurisdictional disputes.

Vietnam and China – with Asean’s help – must agree to exclude their essentially bilateral dispute over the Paracels from the scope of the code of conduct – perhaps by using ambiguous language on its geographic scope.

The US and other outside powers must refrain from interfering behind the scenes, and Asean members must commit to resisting the influence of China vis-à-vis US interests. Then the five Asean claimants can reach agreement on the code of conduct’s language. Through negotiations with the other Asean five, a unified proposal would emerge and then Asean as a whole can negotiate with China.

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This probably will not happen, however. Vietnam is unlikely to surrender its Asean leverage over China. And China would rather deal with Asean as a whole.

The US is unlikely to restrain itself and, even if it did, Asean members such as Singapore and Vietnam hold similar positions. Moreover, some Asean members will resist a subdivision in the process for fear of intensifying polarisation within Asean and weakening it.

Asean and the region must face the reality that agreement on a robust code of conduct is unlikely. The debate is then likely to turn to whether a loose and flexible code is better than none at all. A loose code has the advantages of flexibility, preservation of sovereignty and providing a foundation for law. It could be a testing ground for what works. But a loose code would also lack legitimacy, legal certainty and enforcement mechanisms.

Some argue that a soft code is better than none. Others say a soft code is worse because it will legitimise and enhance China’s diplomacy and role in Southeast Asia. Negotiations over the code are likely to languish while the debates continue.

Mark J. Valencia is an adjunct senior scholar at the National Institute for South China Sea Studies, Haikou, China. This is an edited version of a speech to the Symposium on Global Maritime Cooperation and Ocean Governance on November 4