China's power hunger trumps Japan diplomacy

Posted in China , Asia | 01-Nov-04 | Author: Jeffrey Robertson| Source: Asia Times

A worker places the Russian and Chinese flags outside Tiananmen Gate.
China recently resolved its long-festering territorial border disputes with Russia and made progress in border talks with India, reinforcing a trend toward responsibility and pragmatism, consistent with the great power status to which it aspires. But when it comes to Japan, will China's hunger for energy resources trump this trend toward resolving thorny territorial disputes? It seems so, for now.

On October 14 China and Russia signed the Supplementary Agreement on the Eastern Section of the China-Russia Boundary Line, which effectively concluded agreements on their 4,300-kilometer land border, opening up more favorable conditions for resource and economic development.

In another dispute that had long been placed on the "too difficult" pile, China has advanced talks that soon could result in a landmark agreement with India. Both sides have expressed a strong desire to swiftly resolve the border issue. Chinese State Councilor Tang Jiaxuan on a visit to India last week boldly stated that China and India must "take forward their cooperation in various fields to face questions, including those left over by history, in a flexible and practical manner".

The level of cooperation and understanding in the China-India relationship has even extended to Chinese support of India's bid for a permanent seat on the United Nations Security Council. "India is a major country in Asia ... China fully understands India's position and endorses its aspirations ... We also hope to see that India plays a greater and constructive role in the UN Security Council," Tang stated.

Canberra-based South Asia analyst Dr Ravi Tomar told Asia Times Online: "The relationship between India and China has matured beyond the regional rivalry that once dominated the relationship." In resolving what has been a problematic relationship marked by rivalry and even spoiled by border clashes, Chinese diplomacy has achieved a new level. Although China's appetite for energy resources threatens to outweigh the trend toward great power responsibility epitomized by its dealings with Russia and India.

Recent talks with Japan, however, were a dismal failure in even approaching the resolution of a maritime dispute. On October 26, Kyodo News service reported that Mitoji Yabunaka, director general of the Japanese Foreign Ministry's Asian and Oceanian Affairs Bureau, and Nobuyori Kodaira, head of the Agency for Natural Resources and Energy, represented Japan in talks with Cui Tiankai, director general of the Chinese Foreign Ministry's Asian Affairs Department. They were attempting to tackle the troublesome maritime boundary issue at a time when Sino-Japanese relations already are plagued by other concerns.

The talks did not achieve any meaningful progress, and Japanese Trade and Industry Minister Shoichi Nakagawa later told reporters in Tokyo that he didn't plan to get involved in any further talks that end without resolution. "I don't even know why these talks were even held," Nakagawa said, emphasizing their failure.

On a slightly calmer note, a day after the talks, Chinese foreign ministry spokesperson Zhang Qiyu, stated, "China's gas exploration is conducted in our coastal waters where Japan does not have disputes with us. It is a normal activity of exercising sovereignty ... consultation and dialogue are the only correct choice for resolving the questions related to the East China Sea."

The issue centers upon the exploitation of gas reserves in the East China Sea. Both sides claim the disputed zone as an exclusive economic zone (EEZ), which under the United Nations Convention on the Law of the Sea can be drawn 200 nautical miles from a state's shoreline. But with significantly less than 400 miles between the two states, both sides have fortified themselves behind the most advantageous alternate definition. China supports a demarcation line drawn where the continental shelf ends, close to the Japanese shoreline of Okinawa, while Japan supports the median line.

The Australian Bureau of Agricultural and Research Economics notes that the Chinese government has prioritized the use of liquefied natural gas (LNG) as an alternative to the use of coal with its associated environmental risks and problems. "China's tenth Five-Year Plan for National Social and Economic Development makes it clear that natural gas will play an expanded role in meeting the country's energy demand," the bureau said.

"LNG offers flexibility of supply and can be a more cost effective source of supply than pipelines in the early stages of gas demand buildup," it said. For China this will alleviate medium-term energy security challenges until longer-term projects, such as international gas pipelines and nuclear-based electricity generation, are realized.

In October 2003, China started developing the Chunxiao gas field, which lies just within the Chinese side of the Japanese-recognized median line, and well within the Chinese recognized continental shelf limits. The development of the Chunxiao field has continued despite the pullout in September 2004 of two major Western oil companies, Unoco and Shell. They reportedly were wary of both the questionable commercial value of the project and the potential Sino-Japanese diplomatic fallout that could obstruct development.

If China continues to develop the Chunxiao gas field on schedule, production will commence by mid-2005. Japan fears that when this occurs, the Chunxiao field may eventually siphon off what little natural energy resources exist under Japanese territory.

The greatest difference between China's relationship with India and that with Japan is not the obvious historical animosity - it is the very real contemporary rivalry over readily exploitable energy resources.

China's hunger for energy is threatening a similar diplomatic challenge in the South China Sea, ironically, one in which China fears its own resources may be siphoned off, just as Japan fears it will lose its own resources to Chinese development of the Chunxiao field.

In all aspects, the East China Sea dispute is remarkably similar to the more than a handful of maritime disputes China has had with Malaysia, Brunei, Vietnam and the Philippines over the Spratly Islands and with Indonesia over the Natuna Islands in the South China Sea. Disputes with Vietnam over South China Sea claims have even resulted in armed conflict on no less than four separate occasions.

A pragmatic solution that resolved the immediate threat of further conflict in the South China Sea was achieved in 2002. The Code of Conduct in the South China Sea signed by China and the Association of South East Asian Nations (ASEAN) on November 2, 2002, committed the parties to the principle of peaceful coexistence and to refraining from actions that could complicate or escalate disputes. Chinese Vice Foreign Minister Wang Yi described the agreement at the time as a move to build "mutual trust in the resolution of problems on the issue of sovereignty".

However, on October 21, Chinese Foreign Ministry spokesperson Zhang Qiyue expressed concern that Vietnam, in her words, had not lived up to the code of conduct, by inviting public bidding for oil and gas exploration in disputed areas of the South China Sea. "It [Vietnam] should cease to adopt any unilateral action that would complicate or give further rise to expand the disputes, and work together with countries concerned in the area to maintain the peace and stability of the South China Sea," Zhang said.

The Code of Conduct in the South China Sea is a remarkable piece of modern diplomacy, bringing the "ASEAN way" of non-interference, coexistence and understanding, built through informal relationships, into inter-state relations. Unfortunately, it is also an agreement that has the potential to crumble in the face of the precise legal challenges of resource economics.

Despite China's proven great power responsibility, it may be its ever-increasing hunger for limited energy resources that bucks the trend toward dispute resolution, as has been the case with another great power in Iraq.

Jeffrey Robertson is a political affairs analyst focusing on Australian relations with Northeast Asia, currently residing in Canberra, Australia.