The South China Sea (44 page)

This is still the fundamental dispute that prevents joint development in the Sea. When Dr Wu talks about joint development, he says openly that it only applies to areas within other countries’ EEZs, not China's. Ernie Bower of the Center for Strategic and International Studies in Washington says no other country is likely to join such an initiative. ‘The bottom line is that everyone other than China will reject joint development under the terms that China is the biggest player in the region and will define and dictate the terms. The big question is whether and when China will have the confidence to negotiate terms as a crucial partner but not trying to dictate the terms.’

In November 2011, at the ASEAN–China Summit in Bali, Premier Wen Jiabao announced the launch of a 3 billion yuan ($470 million) ‘China–ASEAN Maritime Cooperation Fund’. Senior officials have promoted the fund on many occasions since. In September 2013, Wen's successor, Li Keqiang, told the launch of the ASEAN–China Expo: ‘We are doing researches in carrying on a series of cooperation projects, giving priorities to construction of fishery bases, environmental protection for
maritime ecology, seafood production and trade, navigation safety and search and rescue, and facilitation of maritime transportation.’ These are almost the same issues on which Beijing had vetoed cooperation during Hasjim Djalal's workshops. ‘We are expecting the active participation of the ASEAN countries,’ he continued.
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But the ASEAN countries are not participating – they assume there will be political strings attached that could compromise their territorial claims. At the time of writing not a single yuan has gone to a project involving ASEAN. Only one project has been touted – and that would benefit a state-owned Chinese company, Guangxi Beibu Gulf International Port Group, which is expected to buy a stake in Kuantan port in Malaysia during 2014 and then upgrade its facilities. It sounds like another neat coincidence between national rhetoric and Chinese corporate interest.
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There is an apartment in London overlooking the River Thames, a couple of miles upstream from Captain Richard Spratly's birthplace and a few miles downstream from where he died, where an alternative way forward is being nurtured. It's a very grand apartment, in the heart of the Whitehall political district, trimmed with works of art, antiques and curios from all around East Asia. It frequently hosts members of the trans-Atlantic elite hopping between homes in old and New England and it's also home to an organisation that considers itself a potential solution to the South China Sea disputes. The ‘Kingdom of the Colonia of Saint John’ may sound like a Ruritanian fiction but its supporters claim that it is the legitimate heir to the empire of the Filipino ‘admiral’, Tomas Cloma, and to Cloma's claim in the South China Sea. The administrator of the claim goes under the pseudonym Thomas de Lys: banker, former associate of the Marcos family and once a financial advisor to Madame Chiang Kai-shek, the ‘Dragon Lady’ wife of the Kuomintang leader.

De Lys showed me a document, a Decree of the Supreme Council of State of Freedomland, apparently signed by Tomas Cloma on 24 August 1974, in which the name of Freedomland was changed to ‘Colonia’ and Cloma resigned as head of state in favour of a British property developer called John Barnes (who subsequently changed his name to John de
Mariveles). The signing was witnessed by Tomas’ brother, Filemon Cloma, and an associate of Barnes, a former U-boat commander called Eric Sroka. It was later notarised by a Manila lawyer, Rufino A. Sanic. According to de Lys, insiders had warned Cloma that President Marcos was about to force him to hand over the claim to the Philippine government so he tried to outsmart them. When Cloma eventually did sign the government's document, on 4 December 1974 after nearly two months in jail, he used the words ‘whatever rights and/or interests they might have acquired over said islands called Freedomland’, implying that there actually weren't any interests left, although Marcos wasn't to know that.

De Lys’ argument is essentially this: under the 1951 Treaty of San Francisco, the Japanese state renounced its claim to the Spratlys. They therefore became, in legal terminology, unoccupied –
terra nullius
– allowing Cloma to legitimately claim them for himself. Readers who've made it this far will know that there was a pre-existing French claim on six islands dating from 1933, renewed in October 1946, and a Chinese claim to Itu Aba, dating from December 1946. But in de Lys’ view, Cloma avoided these problems. ‘In deference to this French claim, Cloma partitioned off the southwest corner of the territory that included Spratly Island, which had the effect to give the Cloma claim its current trapezoidal shape. Specifics related to ROC [Republic of China] claims could be considered “extinguished” as the ROC is arguably not considered a “state” in international law and specifics related to PRC [People's Republic of China] claims have not to date ever been proposed or clarified by China, other than the so-called “nine-dash line”. The Vietnam claim is based on the contention that they are successor to the French claim but the French dispute this.’

Over the years many entrepreneurs have attempted to set up their own countries: the Brooke family managed it in Sarawak, for example. Most, however, were of dubious integrity. US authorities have had to deal with a number of fraudsters who claimed to be representing countries based on coral reefs and wanting access to the international banking system. There have been several in the South China Sea. In 1971 an American, Morton Frederick Meads, announced himself the ruler of the Kingdom of Humanity–Republic of Morac-Songhrati-Meads based in the ‘Meads Islands’ and managed to fool the Malaysian government for a while. Unfor-tunately for the Kingdom–Republic, its supporters were reported drowned
during a typhoon in June 1972. A rival ‘Principality of Freedomland’ was apparently announced by a French conman in 1974 – with no known connec-tion to Tomas Cloma – and the Republic of Thaumaturgy, with a declared capital on Louisa Reef, attempted to sell government bonds to gullible investors in 2004. In fact there's an entire international sub-culture of groups and individuals claiming to represent atoll-based nation states, chivalric orders and defunct royal families.

The Kingdom of the Colonia of St John, however, appears different. It has a real address, with real people behind it and real documents to support its claim. More importantly it has real access to influential people and real money behind it. Thomas de Lys is part of an east coast American dynasty, which made its money building power stations in Asia and later provided the United States with a treasury secretary and Yale University with some fine new buildings. De Lys’ chums include many who know the corridors of power – from buccaneering capitalists to hot-shot lawyers.

Virginia Greiman specialises in designing novel solutions to old problems. She was a lawyer on the ‘Big Dig’ – the massive tunnelling project under Boston – and now teaches at Harvard Law School. Her case for Colonia begins with exactly the same argument as the Gao Zhiguo and Jia Bing Bing article – that UNCLOS isn't everything and a country can assert ‘historic title’ to territory, but that Colonia is the rightful successor to Freedomland's claim from 1956. Over lunch in central London she outlined her proposed development model, a ‘hybrid institution’ based on her experience with mega-projects. Her approach would try to answer the four questions identified by Djalal and Townsend-Gault but with a private sector rather than an inter-governmental model. A Joint Study Group from all the claimants would develop a framework for dialogue and negotiate an agreement. The agreement would define a ‘Spratly Island Concession Area’ (SICA) and the allocation of assets within it. It would be open to all claimants, with disputes referred to the area's own arbitration court. The area would have its own authority that would allocate concessions to extract resources.
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‘It could be a bridge between China and the Philippines,’ she argues. ‘The key is to keep it in the private sector and prevent countries going to international tribunals.’ She is confident that both China and the Philippines would gain from the arrangement. But what about Colonia?
Under the SICA model Colonia would receive a share of the revenues and it would be up to Colonia's ‘rulers’ to decide what to do with them. She says some would go to good causes. ‘Colonia wants to share resources for the benefit of the world so it's building links with churches and others to form a possible trust to benefit, for example, poverty alleviation.’ The most obvious challenge to this grandiose plan is the considerable doubt about whether any of the claimants will take Colonia seriously. The next will be whether the claimants will be any more likely to find agreement in Greiman's ‘Joint Study Group’ than in the existing structures open to them through informal workshops and international arbitration. It might sound crazy, but is it any less realistic than expecting China to abandon its ‘indisputable claim’ to the South China Sea?

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Weary readers of this book might, at this point, be wishing for a sizeable dose of climate change to raise sea level and submerge the features of the South China Sea altogether. Even the conservative prediction of a 39 to 58 centimetre rise by 2100 could put some of the existing features below water. Sadly it's less likely to reduce the problem than unleash yet another round of instability. Future rises in sea levels weren't a major concern when UNCLOS was drafted and so the convention provides no explicit guide as to how they should be dealt with. Hypothetical arguments have already begun, with scholars arguing either that the correct interpretation of international law would maintain the status of land features as they existed in 1982 or that boundaries could move. Even if they fall far below the waves, states would probably continue to make claims on them. Japan has already spent huge sums to try and prevent the rocks on Okinotorishima, an atoll far into the Pacific Ocean, being eroded away in order to preserve its case that it is really an island entitled to a full EEZ.

So with that ‘solution’ unlikely, what else is possible? The good news and the bad news were displayed during the month of May 2009. When Malaysia and Vietnam made their joint submission to the United Nations’ Commission on the Limits of the Continental Shelf, they only measured their claims from their mainlands and not from any of the disputed islands.
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But that was the cause for China to issue the ‘U-shaped line’
map a few days later – apparently changing the terms of the argument. All the countries, with the exception of China, have gradually brought their claims broadly into line with UNCLOS. Southeast Asian countries may not recognise the validity of each other's claim, but they are starting to agree a basis to resolve their disagreements. Little by little some of the disputes in the Sea are being untangled.

Vietnam, Malaysia and Indonesia have settled their seabed claims in the area where they meet and the three countries are working towards delimiting their EEZs. In the meantime they are pursuing joint development in the overlapping zone. The boundaries between Malaysia and Brunei were initially settled by British colonial administrators in 1958 and then extended by a bilateral agreement on 16 March 2009. There is still a latent dispute over Brunei's extended continental shelf, which would run into the Malaysia–Vietnam joint development area but this seems unlikely to provoke confrontation. At the time of writing Vietnam, the Philippines, Malaysia and Brunei have still not clarified their full continental shelf claims.

The biggest intra-ASEAN problem is the Philippines’ continuing claim on the Malaysian province of Sabah – derived from the British North Borneo Company's initial agreement to cede or lease (the exact translation is critical to the dispute) the area from the Sultan of Sulu in 1878. As the putative ‘invasion’ of Sabah in February 2013 by supporters of the then Sultan demonstrated, the claim remains a highly sensitive issue. Although that Sultan died in October 2013, his final wish was that the claim should be upheld.
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As a result the Philippines cannot agree even the starting place for its boundary delimitation with Malaysia, since one side would first have to recognise the legitimacy of the other's claim to Sabah. When Henry Bensurto of the Philippines presented the idea of the Zone of Peace, Freedom, Friendship and Cooperation to the Malaysian government's Institute of Maritime Affairs in December 2011 he used a slide showing the Philippine boundary emanating from the border between Malaysia and Brunei. It was perhaps not the most diplomatic way to present the plan. Unsurprisingly, the Malaysians later declined to support the initiative.

Law is unlikely to provide the final answer to the disputes. Even if the Permanent Court of Arbitration rules in favour of the Philippines, no global policeman is likely to enforce the verdict. However, should
China ever attempt to restrict US military access through the Sea, we can be sure that international law would be invoked to justify Washington's response. In the meantime, the threat of force is working the other way. The Philippine government argues that if it could develop the hydrocarbons in the Reed Bank the living standards for millions of its people would improve. Turning the argument around, it might argue that the government's inability to develop those resources is keeping levels of malnutrition and infant mortality in the Philippines unnecessarily high: people are dying because of the South China Sea disputes. If Forum Energy, or another company, attempts to survey or drill on the Reed Bank without Beijing's consent, Chinese vessels will block it. In the long term Manila might build up sufficient naval strength to be able to protect a drilling rig, but that seems far away. In the meantime, the Philippines does not have the military capacity to assert a credible defence, so it will either have to delay development or submit to China's demands. Will Manila get sufficiently desperate to do a deal? Will China come to some arrangement either before or after a verdict by the Permanent Court?

There are no easy alternatives to continuing strife in the South China Sea. No side wishes to provoke a conflict but none is willing to reduce tension by moderating its territorial claims. With every rock now either occupied or under the control of one or other country, the stress has shifted to the spaces in between and the resources that may, or may not, lie beneath. There is, unfortunately, plenty of opportunity for conflict to emerge and escalate. The merging of the territorial disputes with the wider struggle between the US and China over access and security only makes the situation more dangerous. Given that governments are refusing to work together on an issue as critical as food supply, it's hard to see any likelihood of progress towards regional cooperation. Joint development sounds like a good idea but won't be practical until China clarifies its position. Which brings us back to its historical territorial claim.