Toward Economic Cooperation and Regional Strengthening in the Spratlys

Foreign Affairs Security

Remaining united regionally is precisely what we must do to maximize our potential gains against China and to minimize potential disputes among ASEAN member states.

  1. Secure regional agreement to a unified, multilateral approach to the resolution of the dispute

  2. Craft a workable plan for joint development of resources


Secure regional agreement to a unified, multilateral approach to the resolution of the dispute


“However confident China may be in its own legal arguments…it wants to avoid unified legal positions among smaller regional powers, just as it wants to divide them generally in negotiations.”1 Remaining united regionally is precisely what we must do to maximize our potential gains against China and to minimize potential disputes among ASEAN member states. The great challenge to achieving this will be defusing the stakes of the intractable sovereignty conflicts and great power standoffs toward building common ground from which all can move forward peaceably, lastingly, and while saving face internationally and domestically.

China holds considerable sway over Cambodia, Laos, and Myanmar, and at the 2012 ASEAN meetings in Cambodia this became apparent. When a Cambodian foreign ministry official stated following the November 2012 ASEAN Summit meeting that Southeast Asian leaders “had decided that they will not internationalize the South China Sea from now on,” President Aquino responded that “The ASEAN route is not the only route for us. As a sovereign state, it is our right to defend our national interests.”2 This crucially delegitimized ASEAN, exposing the disunity among its members and diminishing its centrality within regional security matters, while simultaneously causing ASEAN to distrust the Philippines as a diplomatic partner. 

Isolation within ASEAN is not far-fetched—at least to the extent that China could make it economically and politically unattractive for ASEAN members to agree to treat the dispute as a multilateral affair rather than as bilateral affairs. It was only through heavy Philippine pressure that ASEAN was moved to take a multilateral stance in 1995, and the resolve then was tenuous. Regional cohesion is especially needed, because the ITLOS decision may sow conflict between Vietnam and the Philippines even if it helps our case against China. Moreover, regional cohesion is what will provide the best stable counter-balance to growing Chinese power—not a great power contest in Asia that invites more (not less) conflict over the long term.

The South China Sea is potentially positioned to bring great profits to many (not just to any one national entity) if joint development is adopted, and with China as a ready, natural market for the resulting hydrocarbons, energy resource cooperation can be made into an incentive for and guarantee of stability and conflict resolution in the region.

Policy proposal 

  • Employ a unified, multilateral approach to the resolution of the South China Sea disputes through ASEAN that adheres to ASEAN centrality.
    • The Philippines must convince ASEAN that regional cohesion against China in the settlement of territorial and maritime disputes and vigilant upholding of the UNCLOS are crucial over the long-term for all ASEAN member states, not merely those involved in this dispute. This multilateral approach is the crucial plank to the Pax Asia-Pacifica.
    • Convince ASEAN to leverage China’s energy needs towards peace.
  • Rather than focusing on the territorial and maritime disputes as the central issue, economic cooperation and regional reorientation decenters the dispute to defuse tension, and allows for all parties to ‘save face’ to their international and domestic audiences. 
    • Reassure the U.S. and Japan that this is not about forsaking their partnership and aid in favor of China’s, but about striking a middle, regionalist ground that secures peace and prosperity for all those in the South China Sea. It is not about power; it is about development.
    • This should be seen as acting in the long-term interest of the U.S. as well as of China.


Craft a workable plan for joint development of resources

Policy proposal  

  • Advance a plan for joint development of resources that features:
    • Ease of domestic passage to ensure the avoidance of the political morass of past joint development attempts that have been stymied by the Philippine Congress through flexible, creative adherence to the Philippine Constitution’s strictures regarding foreign ownership (otherwise our offer will not seem credible to other claimants)
      • Possible structural model to follow is the Malampaya structure of 45-45-10, though other structures should be explored if the next administration successfully eases the restrictions on foreign business ownership in the Philippines
    • Requirement that all projects go through public bidding, as set out in the Philippines’ Petroleum Exploration and Development Act of 1972, and are not merely awarded to Chinese companies
    • Financial or Technical Assistance Agreements (FTAAs) to aid the Philippines through technology transfer, moving toward ending our reliance on foreign companies, while enabling the Philippines to maneuver around our limits on foreign ownership in joint ventures
    • Limitation of the militarization of the disputed islands, expressly prohibiting: sophisticated aircraft and surface-to-air, anti-ship, and anti-aircraft missiles
    • A joint commission on maritime and territorial disputes, to enable the shared endeavor to proceed along two tracks—separating the economic and security tracks
    • Application of the established international law concept of uti possidetis (“as you possess so shall you possess”) toward moving past sovereignty issues and focusing instead on shared economic benefit
      • This would allow claimants to “acknowledge and live with the status quo without having to agree that its establishment was right or proper. Its application to the land features in the South China Sea would clear the way for the clarification of boundaries on the basis of the law of the sea, supplemented by the demarcation of these boundaries through bilateral negotiations as required to draw median lines.”3
      • “A total of forty-four features in the Spratlys are currently settled, occupied, or garrisoned: twenty-five by Hanoi, eight by Manila, seven by Beijing, three by Kuala Lumpur, and one by Taipei,” and this legal principle would fix those numbers as such.4



Matthew Waxman, “Legal Posturing and Power Relations in the South China Sea,”, January 21, 2015, accessed June 17, 2015,


Maria Ortuoste, “The Philippines in the South China Sea: Out of Tie, Out of Options?” Southeast Asian Affairs (2013): 240-253.


Chas W. Freeman Jr., “Diplomacy on the Rocks: China and Other Claimants in the South China Sea,” speech delivered at Brown University, April 10, 2015, accessed on June 29, 2015,







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