Countering China's Maritime Grey Zone Activities

Key Findings

• High stakes in the South China Sea: Nearly a third of the world’s shipping trade passes through the South China Sea (SCS). If China gained sole authority over these waters, it will get outsized leverage in terms of foreign policy compliance. Though China assures the international community of unhindered access to the SCS, historic evidence suggests China is capable of reneging on promises and commitments, be it the occupation and militarization of islands in the waters of the SCS or border agreements with India. The Chinese Communist Party’s (CCP) increasingly nationalistic tones regarding this zone are meant to consolidate President Xi Jinping’s power aspirations and impose “law of the strongest” by challenging existing multilateral agreements like the UNCLOS.

• ‘Grey Zone’ creating policy disorientation: The grey zone activities fall in between peace and war, but there is no legal grey zone. The more the term ‘grey zone’ is used, the more the world gives China the unintended veneer of acceptability. Liberal, law-abiding democracies that are accountable to the rule –of law, hesitate to counter such grey zone activities by authoritarian regimes. Consequently, Chinese grey zone activities are creating policy disorientation across global capitals - magnified by a lack of political will in the capable countries and weak capabilities in others.

• UN tribunal award - ‘A piece of trash?’: President Duterte of the Philippines has leaned in favour of China ever since he was elected in 2016. Duterte has opted to use the Philippines’ successful 2016 tribunal ruling against China as leverage to get Chinese financing for his ‘build-build-build’ domestic programme, instead of using it to enforce the Philippines’ rightful maritime sovereignty. Even during the Mar 2021 standoff at the Julian Felipe Reef, Duterte dissed the tribunal award as “a piece of trash”.

• ASEAN - a divided house:

1. Philippines’ win – a broken lighthouse: Duterte’s position on the tribunal award and the differing political and economic interests of other claimant nations, has limited the utility of the tribunal award as an example to follow against China’s other maritime transgressions. On maritime security issues in the SCS, ASEAN is a divided house – a condition China exploits. For ASEAN, “the inevitable is the unthinkable” in the SCS. It is the reason ASEAN is wary of the Quadrilateral Security Dialogue, which it views as not just as an association of liberal democracies but of major naval powers – exacerbating the apprehension of a possible conflict in its own backyard.
2. The Code of Conduct: ASEAN is struggling to maintain its centrality given the competing geo-political forces in the region. The struggle of decades-long negotiations between ASEAN and China on the Code of Conduct in the South China Sea, is emblematic of this problem. Although ASEAN has been able to produce a single draft negotiating text, substantial discussions remain outstanding and a final agreement is still not on the horizon.

• China seeks to monopolize the Code of Conduct: China wants certain provisions added to the Code of Conduct which are contrary to the legitimate economic and navigation rights of third parties whose protection has been demanded by many countries, including India. Some of the problematic provisions demanded by China include: -

1. Disallowing non-ASEAN countries from economic activities in the SCS.
2. Providing veto powers for restraining other members from undertaking joint military exercises with their treaty allies and partners in the SCS.

• Taiwan: The intensity of Chinese grey zone activities around Taiwan has accelerated over the last few years. Taiwan has been at the forefront of China’s multi-domain grey zone activities. Despite the growing cross-strait asymmetry, Taiwan has been consolidating its strategy that is focused on defensive deterrence and countering if attacked. Taiwan remains a unique example for regional powers to follow and develop strategies for countering Chinese grey zone activities.

• China’s problematic Coast Guard Law: Countries have sovereign rights to formulate governing rules for maritime law enforcement agencies. But China’s January 2021 Coast Guard Law (CCG) is considered by many as a threat to security and stability in the region. Some of the problematic provisions include: -

1. Jurisdiction – China has often deployed Coast Guard vessels to enforce maritime law in the Philippines’ EEZ. The new China Coast Guard Law is becoming a legal instrument for China to assert its excessive maritime claims.
2. Use of Force – The law provides provisions for the use of force for eviction and demolition of structures within its ‘jurisdiction’ – a term left geographically undefined. It also authorizes the CCG to use force against government vessels of other countries – a provision contrary to international law and principles of ‘sovereign immunity’.

• Recommendations:

1. U.S.: The U.S. must overcome the sea-blindness it has adopted over the last decade. It must not only focus on enhancing the capacity of the U.S. Navy and Coast Guard, but it must also help expand the capacities of regional powers in the maritime domain.
2. ASEAN nations: ASEAN nations must focus on an “expose and oppose” strategy to gain an early advantage in narrative-shaping. China thrives on maritime grey zone activities in places where access to information is limited. Such grey zone activities must be treated as a maritime insurgency. Exposing grey zone operations at an early-stage limits tactical and operational impacts.
3. The Quad: The Quad must expand beyond security to developing political and economic relationships. It can provide resources, trade opportunities and markets to regional Asian powers as a counterbalance to China.
4. Taiwan: Taiwan must be included in non-traditional multilateral maritime exercises.