What it might take for China to agree to a non-binding COC

China's Foreign Minister Wang Yi speaking at the Ministry of Foreign Affairs in Beijing, China, on April 14, 2017. PHOTO: REUTERS

On March 8, China's Foreign Minister Wang Yi announced that agreement had been reached between China and Asean countries on a first draft of a framework for a Code of Conduct (COC) for the South China Sea.

This agreement triggered an outburst of diplomatic optimism that a COC could be successfully negotiated. Indeed it was hailed as a sign of "steady progress" and a "potentially significant step towards cooling tensions" in the area.

However, agreement on a detailed, unambiguous and binding COC is a diplomatic holy grail - an unattainable myth. The root reason is the burgeoning geopolitical struggle between China and the United States for dominance in the region and the impact of that historic struggle on the COC conundrum.

That this is a major factor in China's thinking was underscored when Mr Wang added to his announcement of the agreement the observation that "if someone is still trying to make waves, they will have no support and will meet opposition from all parties".

The US is the dominant power in Asia. But China is the rising challenger to that US role - and to the region's status quo political order. It may be possible for the two to reach a compromise in which the US tacitly recognises and accommodates China as a major power in the region. By doing so, strategic rivalry and possible war may be avoided.

Prominent Australian analyst Hugh White, a regular columnist in this newspaper, has described and analysed this geopolitical situation astutely. He concludes that a compromise is possible.

"It is perfectly possible and highly desirable for the US to continue to play a major strategic role in Asia on a basis that China is willing to accept, and which therefore avoids escalating strategic rivalry and reduces the risk of war."

But such power-sharing is unlikely. The US has no history or precedent of doing so and it is not likely to start now.

Professor White puts his finger on the crux of the problem when he says that American leadership seems to see this contest as "a question of whether America will dominate the region or retreat".

For the US, there is no compromise or middle ground for its hegemony. So China believes it will have to "persuade" the US to accommodate its ambitions. I agree with Prof White's major worry that "the US policy community has, with few exceptions, failed so far to understand the nature or the scale of the challenge it faces in negotiating (a) new relationship with China", such as that proposed by China President Xi Jinping to then US President Barack Obama at their 2013 Sunnylands summit.

So China assumes it will have to slowly "persuade" the US to accommodate its ambitions.

This is the essence of the current struggle between the two.

The relevance of this struggle to the South China Sea is that Asean has become a cockpit of this contest and the negotiations for a COC are its current nexus. Indeed, the two are competing for the hearts and minds of Asean members on this issue.

This is why China has re-engaged in COC negotiations. To win this contest with the US , it needs good relations with South-east Asian nations - collectively and individually. China also wants to remove opportunities for the US, Japan and now a more adventurous India to "meddle" in the issues and rally some Asean members against China. To attain its goal of being the clear hegemon of at least South-east Asia, China must have and use both hard and soft power - the "ability to shape the preferences of others through appeal and attraction".

Its modernising military prowess is its hard power. Its soft power depends in part on its diplomatic skills. China needs to be seen as willing to negotiate rather than being uncooperative or belligerent.

Some particular aspects of a prospective COC that have been caught up in this titanic struggle are who signs it, the area to be covered and, most important, whether it is binding and has dispute settlement and enforcement mechanisms.

China's recent experience with third-party arbitration pursuant to complaints filed by the Philippines under the United Nations Convention on the Law of the Sea was diplomatically painful and embarrassing. China will likely firmly oppose any provision that could subject it to such third-party dispute-settlement processes without its consent.

Nevertheless, the results of that arbitration are now part of the "international law and order" that the US uses to hector and constrain China regarding its policies and actions in the South China Sea.

Indeed, China believes that the US both encouraged and aided the Philippines in its legal action against it. Clearly, China has other ideas as to what that "international law and order" should be and is demonstrating that.

China may also see some proposed elements of a COC as attempts to indirectly get it to recognise the results of the arbitration. For instance, the decision significantly narrowed the maritime area in dispute by rejecting China's nine-dash line claim and proclaiming that none of the Spratly features can generate exclusive economic zones or continental shelves. This means that there is a large area of high seas and seabed in the South China Sea that is "the common heritage of mankind". This bolsters the argument that "outsiders" have a right to join and participate in the COC. This would be welcomed by the US, Japan and India and, of course, be anathema to China.

Another example is whether the disputes should be negotiated by Asean and China or bilaterally by each of the Asean claimants and China. The US supports the former because it hopes a united Asean can be a political ally in its struggle with China. China insists on the latter because it has a distinct advantage of hard and soft power in such negotiations.

Asean has long been divided on the South China Sea issues. Given the implications of the China-US struggle and the uncertainty of US staying power under President Donald Trump, some are now rather reluctant to push China on these issues. China has been successful in the past in preventing Asean consensus on matters that affect its national interests, particularly regarding the South China Sea. Thus China will likely successfully pressure some members to support its position on key clauses of a COC preventing such a consensus.

The conclusion is that China may be willing to agree to an ambiguous, non-binding COC if and when other claimants agree to negotiate the disputes directly with China. Otherwise, the negotiations will continue to be a political wayang kulit infused with the China-US rivalry, and will drag on indefinitely.

• Dr Mark Valencia, an international relations and maritime policy analyst focused on South-east Asia, is an adjunct senior scholar at the National Institute for South China Sea Studies, Haikou, China.

A version of this article appeared in the print edition of The Straits Times on June 06, 2017, with the headline 'What it might take for China to agree to a non-binding COC'. Print Edition | Subscribe