South China Sea Tension Rising As Russia Backs China

By Mark Melin on April 25, 2016 2:22 pm in Politics

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South China Sea tension is approaching a boiling point, the Associated Press is reporting, as Russia appears to take sides as a test of the relative international influence of the U.S. may be in the offing.

South China Sea Tension: U.S., U.K. support U.N. ruling, China, Russia opposed

The United States is calmly if quietly ratcheting up its actions in the South China Sea as a U.N. tribunal ruling could point to an interesting benchmark.

The Philippines have challenged China’s territorial claims in proceedings at the U.N. Court of Arbitration, but China has refused to take part in deliberations and Russia is also casting doubt on the legitimacy of any ruling, increasing South China Sea Tension.

Philippine fishermen are reported to finding difficulty with Chinese Coast Guard that are now patrolling near the Scarborough Shoal. China took control of the area in 2013 after a tense standoff with Philippine naval vessels.

The U.S. Air Force recently flew its first mission over the Scarborough area as part of a new Air Contingent stationed in the Philippines, the AP reported. The mission, whose objective was stated as “domain awareness,” involved four A-10C Thunderbolt jets and two Sikorsky HH-60 helicopters.

A U.S. military statement said the goal was “assuring all nations have access to air and sea domains throughout the region in accordance with international law.”

Not allowing one sovereign nation to establish navigational control of the South China Sea “is extremely important, international economics depends on it — free trade depends on our ability to move goods,” Col. Larry Card, commander of the Air Contingent, was quoted as saying.

(C) Analysis by Spaceknow, Imagery by PlanetLabs 2015

Russia adds to South China Sea tension

While the U.S. is steadily increasing its resistance in the region, Russia weighed in to the fight.

In a statement, Russia said they are opposed to any interference from “third parties,” which the AP cited as a reference to the U.S., “or any attempts to internationalize these disputes,” pointing to the U.N. deliberations.

Russia, like China, say that “only parties can resolve their dispute through direct talks,” a statement that seems to preclude third parties such as the U.N. and U.S. from engaging on the issue.

Currently the U.S. and England back the legitimacy of the proceedings. Britain’s minister of state for the Foreign Office, Hugo Swire, claimed rising tensions in the South China Sea are driven by China’s assertive actions. Speaking at a Washington D.C. think tank, he advocated that any ruling by the court should be binding on both parties.

For its part China, calling the U.N. tribunal “an abuse of international law,” is working on gathering support from regional allies. Pro- and anti- Chinese blocks are forming, the AP noted, with traditional Chinese allies Brunei, Cambodia and Laos lining up behind the communist nation.

Image source: Wikimedia Commons

Obama tactic of slowing increasing pressure at play in South China Sea

The next step for the U.S. appears unclear as President Obama’s deliberate and measured tactics of gradually increasing pressure appear at odds with military leaders who support more direct and immediate confrontation.

Navy Adm. Harry Harris, for instance, has advocated for stronger and more immediate action in retaliation for China’s recent encroachments in the region.

Such public criticism of administration policies was recently blunted, the Navy Times reported. As a nuclear summit in Washington that includes China approaches, a gag order was issued to military commanders regarding the South China Sea.

The outspoken Harris, however, disputed the gag order notion. “Any suggestion that the White House has sought to ‘tamp down’ on my talking about my concerns is patently wrong,” he said in a statement. “I was very public and candid about my concerns regarding many issues in the Indo-Asia-Pacific to include the fact that China’s militarization of the South China Sea is problematic.”

Tags: China Chinese coast guard Russia South China Sea United States

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Written by Mark Melin

Mark Melin is an alternative investment practitioner whose specialty is recognizing a trading program’s strategy and mapping it to a market environment and performance driver. He provides analysis of managed futures investment performance and commentary regarding related managed futures market environment. A portfolio and industry consultant, he was an adjunct instructor in managed futures at Northwestern University / Chicago and has written or edited three books, including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008). Mark was director of the managed futures division at Alaron Trading until they were acquired by Peregrine Financial Group in 2009, where he was a registered associated person (National Futures Association NFA ID#: 0348336). Mark has also worked as a Commodity Trading Advisor himself, trading a short volatility options portfolio across the yield curve, and was an independent consultant to various broker dealers and futures exchanges, including OneChicago, the single stock futures exchange, and the Chicago Board of Trade. He is also Editor, Opalesque Futures Intelligence and Editor, Opalesque Futures Strategies.