Geo-economy of South China Sea
IT seems that geo-economy is making huge inroads in the deep waters of the South China Sea and all parties are now committed to maintaining peace and stability in the region, making it the sea of peace and stability.
Thus the western false, fake and fictional propaganda is flushing out. Most recently, while addressing the opening ceremony of a seminar commemorating the 20th anniversary of the signing of the Declaration on the Conduct of Parties in the South China Sea (DOC) by video, the Chinese State Councillor and Foreign Minister Wang Yi termed peace and stability in the South China Sea as important prerequisites for regional development.
The DOC is the first political document signed by China and ASEAN countries on the South China Sea issue which establishes the basic principles and common norms for all parties/countries to handle the South China Sea issue Wang added.
Wang stressed that regional countries are the real parties that are responsible for properly handling the South China Sea issue.
He called on all parties to continue to maintain peace in the area. He urged that all sides should firmly support all efforts that are supportive to peaceful settlement and management of disputes, by opposing any words and deeds that create tension and provoke confrontation in the region.
Wang also emphasized the need to further improve bilateral and multilateral maritime-related dialogue mechanisms by establishing and advancing the cooperation mechanism between coastal countries, actively promoting practical cooperation in scientific research, environmental protection, search and rescue and other fields, and the discussion of the joint development of resources.
He highlighted that stronger institutional guarantees must for managing differences and promoting cooperation.
He assured China’s commitment and termed that the principle of amity, sincerity, mutual benefit and inclusiveness in its neighborhood diplomacy, and work with ASEAN countries will be foremost priority to defend maritime peace, a build maritime order, a promotion of maritime cooperation, and a contributor to maritime development.
Ours is the age of diversification of land and sea connectivity due to which the development of sustainable blue economy has become the mantra of every country in the world.
Seas have now become new engines of easily sailed routes for the imports & exports of merchandized commodities throughout the world and South China Sea is not any exception.
Even seaports have become strategic arteries for shipping vessels in the region as well as in the world alike.
Obviously, the peace and stability of the South China Sea is directly correlated with the socio-economic integration, immense imports & exports development, FDIs inflows and last but not the least greater regional connectivity of the entire region.
Thus all regional countries should not pollute the deep waters of the SCS by borrowing any foreign idea or plan.
Comparative analysis reveals that the South China Sea (SCS) has rich in marine resources. It has huge quantity of nutrient-laden waters.
It has numerous species of fishes and is the main source of animal protein for the Southeast Asian countries.
It is full of tuna, mackerel, croaker, anchovy, shrimp and shellfish. It is also one the main contributors of maintaining biodiversity and aqua purity.
According to many published reports large reserves of oil and natural gas have been discovered in the SCS which has further increased its strategic importance and utility.
It is an ideal connecting hub which has strategic location too. It contains some of the world’s most important shipping lanes.
The main route to and from Pacific and Indian Ocean ports is through the Strait of Malacca and the SCS.
In this regard, the United Nations Conference on Trade and Development (UNCTAD) estimates that roughly 80% of global trade by volume and 70% by value is transported by sea. 60% of maritime trade passes through Asia, with the SCS carrying an estimated one-third of global shipping which shows its strategic importance.
It has multiplier socio-economic effects and its waters are particularly vital for many regional countries especially China, Taiwan, Japan and South Korea, all of which rely on the Strait of Malacca, which connects the SCS and by extension the Pacific Ocean with the Indian Ocean.
Interestingly, China being the second-largest economy in the world with over 60% of its trade in value traveling by sea, its economic security is closely correlated with SCS.
Moreover, the SCS is an important artery of trade for many of the world’s largest economies.
Many regional as well as international published reports indicate that US$5.3 trillion worth of goods transits through the SCS annually, with $1.2 trillion of that total accounting for trade with the US.
United States trade through the SCS is US$208, China US$1470 and Japan US$240. It has now become an essential maritime crisscrossing for trade for many regional as well as trans-regional economies in the world.
According to official statistical data over 64% of China’s maritime trade transited the waterway in 2016, while nearly 42 % of Japan’s maritime trade passed through the South China Sea in the same year.
Conversely, the USA is less reliant on the SCS with just over 14 % of its maritime trade passing through the region however, always acts as a self-acclaimed champion and main stakeholder of it.
Right from the beginning, China has been very vocal for peace and stability of the SCS. However, certain disruption in Strait of Malacca encouraged the Chinese policy makers to devise an alternative sea route for easy and smooth sailing of its finished goods.
In this connection, Beijing is always inclined to take integrated steps to preserve the free flow of trade in the SCS than it is to disrupt regional trade flows as wrongly depicted by the western countries.
To conclude, South China Sea has vital significance in the region as well as indo-pacific geopolitics.
SCS is one of the world largest and semi enclosed seas. It is full of natural resources like gas, oil, coral lime, high Silicate, sand, quality gem, natural pearls, fish, birds and sea slugs.
Thus the SCS is the hub of the resources. According to different estimations it has rich in numerous industrial minerals like zircon, Ilmenite, cassiterite, arenaceous quartz and monazite etc.
There are many salt mines in it.It is estimated that the SCS gives 604,000 ton annual output of the salt.
These natural resources have immensely increased the importance of the SCS. Furthermore, it is one of the busiest trade routes in the world.
It links the Pacific Ocean with the Indian Ocean due to which it has great importance in the world trade routes.
The SCS partakes the 50 % of the global trade shipping and marine passage. It is the passage of five trillion dollars trade every year.
Therefore the Chinese State Councillor and Foreign Minister Wang Yi has rightly stressed the need to maintain peace and stability in the SCS for mutually befitting propositions for collective socio-economic prosperity, greater regional connectivity and last but not the least post COVID-19 economic recovery in region and beyond.
—The writer is Director, the Centre for South Asia & International Studies Islamabad & regional expert, China, CPEC & BRI.
