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Strategic withdrawal: China's naval policy and the HY SY-981 fiasco

By Benjamin Hale - posted Monday, 28 July 2014

The South China Sea dispute is a contentious issue in the Asia-Pacific region characterised by periodic escalations of tensions, sabre rattling, and often armed conflict. The most recent escalation of tensions occurred as a result of the China National Petroleum Company's (CNPC) unilateral decision to drill two exploratory oil wells in waters contested by Vietnam starting early May and projected to finish mid-August. However, CNPC's decision to withdraw the HY SY-981 drilling platform from contested waters on July 15, a month earlier than expected, has completely overshadowed its earlier reckless assertive actions, with a number of international observers praising Beijing's more moderate approach.

Some even speculated that China might be finally willing to agree on a long-awaited code of conduct on the sea, and maybe even concede to international arbitration to resolve the dispute. However, I argue that China's actions were merely dictated by the need to normalise relations with Vietnam and the United States and ameliorate international pressure congruent with China's overall strategy in the South China Sea region.

China's interests in the South China Sea are diverse and multiform, but can be organised around the general themes of the protection of sea lines of communication, and energy and food security. It has pursued these interests in accordance with the overall strategy of delaying resolution of the dispute, escalating tensions to strengthen its position, and consolidating its gains whilst de-escalating tensions. As such, China's early withdrawal of the HY SY-981 drilling platform is unsurprising. Having already completed its stated goal of drilling for oil there was no longer any incentive to continue operations in the face of international condemnations, as CNPC's itself announced "the mission has been completed smoothly, as planned, and oil and gas has been discovered."


Meanwhile, China's ongoing efforts to create new 'artificial islands' within territory disputed by the Phillipines in the Spratly Islands has gone unnoticed by many commentators infatuated with China following the withdrawal of the HY SY-981. This is particularly ominous considering the expansive EEZ claims China could pursue with these islands and the strategic military implications they could offer.

The withdrawal of the HY SY-981 drilling platform was motivated by a number of factors, the importance of which is difficult to weigh, however, I argue that a key factor in Beijing's decision was to prevent Vietnam from leaving China's sphere of influence. After China's deployment of the drilling platform relations between the two nations plummeted to their lowest point since the cold war, with Vietnamese anti-China riots in May resulting in four deaths, around a hundred injuries and thousands of Chinese citizens fleeing the country.

Furthermore, whilst public opinion was becoming increasingly hostile to China, Beijing's refusal to compromise or negotiate with Hanoi and repeated political stonewalling throughout the HY SY-981 crisis resulted in the Vietnamese Foreign Minister Pham Binh taking the unprecedented step of contacting US Secretary of State John Kerry and arranging a formal visit. In addition, the fact that Beijing decided to withdraw its drilling platform and release a number of detained fishermen is especially revealing as it occurred soon after Vietnam began threatening legal action and was reaching out to the US. This was particular enlightening given the upcoming Vietnamese party plenum in which they will discuss maritime issues in the South China Sea.

Xinhua offers another explanation, noting that China withdrew the drilling platform to prevent damage from the approaching typhoon Rammasun. The news report claims that the drilling schedule took into account "geological hazards, engineering issues and possible typhoons," and "for safety reasons, the test operation was not arranged immediately, because July is the beginning of the typhoon season." However, it should be noted that the HY SY-981 drilling platform was built to withstand such conditions, and despite repairs carried out in 2013, should have been able to withstand all but the most high-category typhoons. The withdrawal of the platform to Hainan Island also undermines this argument as the island was situated along the typhoon's projected course.

Another factor which some have suggested influenced China's decision to withdraw its platform from the disputed waters was America's use of sustained diplomatic pressure since the crisis began. These analysts point to China-U.S. exchanges at the Strategic and Economic Dialogue in Beijing, senate resolution 412 which demanded China withdraw its drilling platform and escort ships, and the telephone call between President Barack Obama and Xi Jinping. However, China has been quick to dismiss such allegations, as China's spokesperson for the Ministry of Foreign Affairs Hong Lei stated "it has nothing to do with any external factor."

However, I argue that China's decision to withdraw HY SY-981 to Chinese waters was not so much influenced by sustained US pressure, as by the international attention the US was drawing towards China's "provocative and unilateral behaviour" in the South China Sea. Washington's condemnations of Beijing's actions as "gluttonous, naked aggression" were not only damaging to China's carefully constructed image as a peaceful rising power, but raised concerns about its willingness to adhere to international rules and regulations. This is especially true regarding ASEAN countries, which are becoming increasingly anxious about China's regional power ambitions.


Thus, Beijing's withdrawal of the HY SY-981 drilling platform does not represent a more moderate maritime policy but is merely a tactical move employed by the CCP with China's overall strategy of escalation and de-escalation in mind. Despite the groundswell of anti-Chinese sentiment in Vietnam, China has already managed to reach out to more moderate Vietnamese politicians to normalise relations.

Furthermore, while China seems to be making small concessions in the form of releasing detained fishermen, it is never going to agree to a maritime code of conduct or international arbitration which would hurt its interests in the South China Sea. Instead China is likely to wait for regular relations with Vietnam to commence before again exerting its naval superiority to escalation tensions and expand its sovereignty into the South China Sea.

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About the Author

Benjamin Hale is an honours graduate and PhD candidate at Edith Cowan University in the field of politics and international relations with a specific focus on Africa.

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Creative Commons LicenseThis work is licensed under a Creative Commons License.

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