Reprinted from RT
Since the recent ruling by The Hague in favor of the Philippines and against China over the South China Sea, Southeast Asia has been engulfed on how to respond. They dithered. They haggled. They were plunged into despair.
It was a graphic demonstration of how "win-win" business is done in Asia. At least in theory.
In the end, at a summit in Vientiane, Laos, the 10-nation Association of Southeast Asian Nations (ASEAN) and China finally settled for that household mantra -- "defusing tensions."
They agreed to stop sending people to currently uninhabited "islands, reefs, shoals, cays, and other features" after ASEAN declared itself worried about land reclamation and "escalations of activities in the area."
And all this without even naming China -- or referring to the ruling in The Hague.
China and ASEAN also pledged to respect freedom of navigation in the South China Sea (which Washington insists is in danger); solve territorial disputes peacefully, through negotiations (that happens to be the official Chinese position), also taking into consideration the UN Convention on the Law of the Sea (UNCLOS); and work hard to come up with a Code of Conduct in the South China Sea (that's been going on for years; optimistically, a binding text will be ready by the first half of 2017).
So, problem solved? Not really. At first, it was Deadlock City. Things only started moving when the Philippines desisted to mention The Hague in the final statement; Cambodia -- allied with China -- had prevented it from the start.
And that's the heart of the matter when it comes to ASEAN negotiating with China. It's a Sisyphean task to reach consensus among the 10 members -- even as ASEAN spins its role as the perfect negotiation conduit. China for its part prefers bilaterals -- and has applied Divide and Rule to get what it wants, seducing mostly Laos and Cambodia as allies.That threat by a peer competitor
The strategic geopolitical centrality of the South China Sea is well known: A naval crossroads of roughly $5 trillion in annual trade; transit sea lanes to roughly half of global daily merchant shipping, a third of global oil trade and two-thirds of all liquid natural gas (LNG) trade.
It's also the key hub of China's global supply chain. The South China Sea protects China's access to the India Ocean, which happens to be Beijing's crucial energy lifeline. Woody Island in the Paracels, southeast of Hainan island, also happens to be a key bridgehead in One Belt, One Road (OBOR) -- the New Silk Roads. The South China Sea is strictly linked to the Maritime Silk Road.
The arbitration panel in The Hague (composed of four Europeans, one American of Ghanaian descent and, significantly, no Asians) issued a ruling that is non-binding; moreover, it was not exactly neutral, as China, one of the conflicting parties, simply refused to take part.
Beyond these expressions of mutual ASEAN-China understanding, hardcore action will keep everyone's juices flowing. The Pentagon, predictably, won't refrain from its FON (Freedom of Navigation) program, which has recently featured several B-52 overflights in the South China Sea along with the usual US Navy patrols.
But now Beijing is counter punching in style -- showing off one of its H-6K long-range nuclear-capable bombers overflying Scarborough Shoal, near the Philippines. That only increased Pentagon paranoia, because the real game in the South China Sea revolves to a large extent over China's aerial and underwater military strategy.
To understand the progression, we need to go back to the early 1980s, when the Little Helmsman Deng Xiaoping set up China's first Special Economic Zone (SEZ) in Shenzhen. From the start, the whole Chinese miracle always depended upon China's eastern seaboard's fabulous capacity to engage in global trade. More than half of China's GDP depends on global trade.