Say Hello To Southeast Asia’s New Silk Roads

It’s not only China vs. the US in the South China Sea. Few in the West realize that two completely different, intersecting stories are developing in maritime and mainland Southeast Asia. The Permanent Court of Arbitration in The Hague denied China’s historic rights to waters in the South China Sea within its nine-dash line; it also ruled that the Spratly Islands are not islands, but ‘rocks’; thus they cannot generate 200-nautical mile exclusive economic zones (EEZs).
These decisions were taken in accordance with the UN Convention on the Law of the Sea (UNCLOS). Now comes the real nitty-gritty – which is a mix of diplomatic ballet and classic Beijing opera.
The framework under which Beijing is ready to negotiate is somewhat detailed here. But the problem at the starting gate is that Beijing stipulates – as a precondition to any negotiation with the Philippines – that The Hague’s decision should not be discussed. Chinese nationalism has been deeply wounded in The Hague, and the Chinese Communist Party (CCP) knows it will be very hard to tame it.
Manila for its part faces a constitutional problem. The Filipino constitution rules that the ‘state shall protect the nation’s marine wealth in its exclusive economic zone, and reserve its use and enjoyment exclusively to Filipino citizens.’ It goes on to say that the state ‘may enter into co-production, joint venture, or production-sharing agreements with Filipino citizens, or corporations or associations,’ but ‘at least 60 per cent of whose capital is owned by such citizens.’ If President Duterte goes against this provision he may be impeached.

This post was published at Zero Hedge on Aug 8, 2016.

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