South China Sea in 2022: Deadlock or Not, Disputant States Press Advantages

China has long propagated the narrative that the disputed South China Sea is a peaceful and stable maritime area. But a review of 2022 shows that disputant states in Southeast Asia have continued to press their advantages, despite protracted negotiations to formalise a more binding Code of Conduct (CoC).

In 2022, claimant parties (Brunei, China, Malaysia, Taiwan, the Philippines, and Vietnam) and non-claimant entities were active across different domains, ranging from administrative, diplomatic, to maritime and military. Indonesia, officially a non-claimant state, has disputes with China over fishing rights in Indonesia’s exclusive economic zone (EEZ) around the Natuna Islands.

Notable Events in 2022

Two administrative moves are worthy of note. Indonesia might convert its Natuna Islands in the South China Sea into a special economic zone with the purpose of improving infrastructure and reinforcing security and defense on and around the islands, where Jakarta and Beijing have experienced increased tensions recently. Philippine lawmakers are proposing the designation of archipelagic lanes — with corresponding air routes — that would restrict foreign ships transiting through the country’s waters.

The unilateral construction activities by disputants in the South China Sea are not included here but are well-documented by the Asia Maritime Transparency Initiative. In 2022, despite the diplomatic façade of resolving their differences through “friendly consultations and negotiations,” China, Vietnam, the Philippines, and Taiwan continued land reclamation and harbour building on occupied features in the Paracel Islands and Spratly Islands.

Five activities related to energy exploration call for attention. In June, for example, the Philippines terminated talks over joint energy exploration with China in the South China Sea, citing constitutional constraints and issues of sovereign rights. On 11 January, tensions escalated after the Philippine Supreme Court declared unconstitutional a 2005 pact by China, the Philippines, and Vietnam on joint oil and gas exploration in the South China Sea.

Meanwhile, it was business as usual for the other claimants. In July, China’s state-owned CNOOC tapped its first offshore shale oil and gas discovery in the southwestern trough of the Beibuwan Basin in the northwestern South China Sea where Vietnam and China have a maritime delimitation agreement. In late August, Vietnam granted the seventh two-year extension to OVL, India’s flagship overseas oil and gas arm, for its contract in Block 128 offshore central Vietnam. While OVL has found no hydrocarbon in the block since it started in May 2006, it is staying to maintain India’s strategic interest in the area.

Of the 59 notable events tracked, 37 or 62.7 per cent relate to actions taken at sea, be it of a non-military/ maritime or military nature. In particular, 14 events were of a maritime nature, such as salvage operations, search and rescue activities, unplanned encounters at sea, routine patrols, routine port visits, and maritime exercises. By comparison, 23 events were marked as having a military nature, of which eight were maritime security exercises, and six were dispatches of military equipment (e.g., reconnaissance aircraft, warships, aircraft carriers, unmanned intelligent drone carrier) or an army unit (e.g., self-defence maritime militia unit). The numbers clearly hint at a tendency to resort to military tactics, such as mobilising arms units and holding military drills, rather than to engage in diplomatic negotiations.

This is not to say that diplomatic talks were scarce. The year saw 15 high-level talks among parties directly and indirectly involved in the disputes, of which only one yielded a notable outcome. At end 2022, Vietnam and Indonesia concluded 12-year-long talks to demarcate the boundaries of their EEZs. Nine of the talks were organised by ASEAN, with only three meetings exclusively focused on the South China Sea issue. These were meetings of the ASEAN-China Joint Working Group on the Implementation of the Declaration on the Conduct of Parties in the South China Sea (JWG-DOC). The latest meeting in October, its 37^th since the JWG-DOC establishment in December 2004, was another futile effort at generating an effective CoC in the sea. The impasse is likely to persist given how ASEAN coastal states want to build the CoC as a more formal way to restrain China’s behaviour, whereas China wants the Code to be a formal way to constrain non-claimants and extra-regional actors such as the U.S. in the region. In 2019, the U.S. objected to two of China’s provisions in the Single Draft Negotiating Text (SDNT) that sought to limit military exercises and joint resources development in the South China Sea to only China and Southeast Asian countries.

Presence of Political Entities in the South China Sea in 2022

Overall, 34 events in 2022 (50.7 per cent) were precipitated by the presence of a non-claimant. The U.S. was the most vocal, followed by Japan and Australia. Many U.S. activities in the South China Sea were deemed of military nature because the U.S. Navy’s routine operations in the Indo-Pacific often involve the deployment of a combat-ready unit, be it a warship, a carrier strike group, or a guided-missile destroyer. In 2022, the U.S. Navy held five freedom of navigation operations, or FONOPs, in the South China Sea, down from seven the year before. The U.S. also participated in five joint drills of various sizes in the region, namely the annual Cooperation Afloat Readiness and Training (CARAT) in Brunei, the Super Garuda Shield in Indonesia, and a trilateral group sail involving Japan and Australia in the Philippine Sea.

A review of activities in the South China Sea highlights the growing unease of disputant states and extra-regional states against Chinese assertiveness in the region. ASEAN, seen as a primary facilitator of dialogue between Southeast Asian claimants and China, has not proven to be an effective channel. Five of ten ASEAN countries have disputes with China in the South China Sea and at times, the bloc has not been entirely united on the issue.

In 2023, as disputants continue their quiet construction and expansion of artificial islands, the presence of trawlers, marine vessels, and coast guard vessels in the overlapping waters may be more regularised. More unplanned encounters at sea might ensue even as all relevant parties try to avoid confrontation.

Short of the CoC being concluded, tensions are likely to stay high because the underlying disputes remain unsettled. Political entities are taking actions unilaterally nearly half of the time, with many actions being militaristic or provocative in nature. Diplomatic protests and meetings remain ineffective. More importantly, claimants and non-claimants alike are facing little to no legal repercussions when taking aggressive actions.

2023/21