Background Briefing: South China Sea: Arbitral Tribunal Award - 1

Background Briefing:
South China Sea: Arbitral
Tribunal Award - 1
Carlyle A. Thayer
July 10, 2017
[client name deleted]
We are doing a report on the one year anniversary of the July 12 arbitration decision.
We request your response to the following questions:
Q1. As things stand, did it do the Philippines and the region more benefit or damage
in the last year, considering President Duterte indefinitely shelved talks with China on
his country's arbitration victory last year? What would have happened if he raised it
immediately and sought Chinese compliance?
ANSWER: President Duterte's decision to shelve the Award by the Arbitral Tribunal
represented a qualified positive first step because it ended the hiatus in relations with
China. President Duterte was able to visit China and meet with Xi Jinping and obtain
offers of large potential investment in the Philippines. Duterte's "pivot to Beijing"
meant that the Philippines was no longer the odd man out in ASEAN on South China
Sea issues. Duterte's actions gave China every incentive to end confrontation at sea
and to engage with ASEAN first on the draft framework COC and now the COC itself.
On the negative side of the ledger, the United Nations Convention on the Law of the
Sea, the "constitution of the world's seas," has been undermined as the basis for good
order at sea. Nothing is being done to protect the marine environment that China
wantonly destroyed when building its artificial islands. Nothing has been done to curb
Chinese fishermen operating in the Philippines' Exclusive Economic Zone. The Arbitral
Tribunal ruled that Mischief and Subi Reefs were low tide elevations and not subject
to appropriation. China has got away with seizing features that are part of the
Philippines' continental shelf.
More seriously, China has not ceased its consolidation and militarisation of its seven
artificial islands. By doing nothing the Philippines is acquiescing in China's illegal
actions and leaving itself more vulnerable to Chinese blandishments in the future.
If Duterte had tried immediately to seek Chinese compliance, China would have
slapped him down verbally and with aggressive actions in the Spratlys. Duterte has
made a rod for his own back by devaluing the Philippines' alliance with the United
States and not working as a team to secure ASEAN diplomatic support.
Q2. When is the right time for Pres Duterte to raise the arbitration ruling with China
and how?
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ANSWER: There is probably no good time to raise the arbitration ruling with China as
long as there is strategic uncertainty over the Trump Administration's commitment to
Southeast Asia. The Philippines can only raise this issue with China when the
Philippines is internally stable and unified, when there is a solid united front in ASEAN
to support the Philippines, and the major powers -US, Japan, India - are willing to back
the Philippines. The "right time" to raise the Arbitral Tribunal's finding might arise
when the Declaration of Conduct of Parties in the South China Sea is fully implemented
and ASEAN members and China ratify the Code of Conduct as a legally binding treaty
and successfully implement it. However, it is unlikely that China will ever give up its
artificial islands including Mischief and Subi Reefs.
Q3. How has President Duterte's outreach to China affected the United States'
influence in Asia or Southeast Asia?
ANSWER: President Duterte's outreach to China has had a lesser impact on U.S.
influence in Southeast Asia that inaction by President Trump. Certainly, downgrading
military exercises with the U.S. and curtailing the rotational presence of US military
forces constricts the U.S. in responding to contingencies such as moves by China to
occupy and build on Scarborough Shoal. The status of President Trump's invitation to
President Duterte to visit Washington remains unclear. China will make gains between
now and the end of the year when Trump plans to visit Manila for the ASEAN summit
and related meetings and Vietnam to attend the APEC Summit.
Duterte’s pivot to Beijing does not alter fundamental U.S. interests in the Philipines
such as investment, trade, people-to-people lines and the alliance. The US has played
the latter issue softly, softly and has done nothing to arouse Duterte's ire.
Suggested citation: Carlyle A. Thayer, “South China Sea: Arbitral Tribunal Award - 1,”
Thayer Consultancy Background Brief, July 10, 2017. All background briefs are posted
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