• China allowed the USS Ronald Reagan carrier battle group to dock in Hong Kong, two months after China denied a similar port call by US naval vessels. In a sign of amity, the US Navy invited the commander of the PLA garrison in Hong Kong on-board the aircraft carrier to observe a US fighter jets in a take-off and landing exercise.
• However, the US also flew long-range bombers over disputed islands in the South China Sea: A pair of US B-52H Stratofortress bombers flew near contested islands in the South China Sea on 19 Nov 18 as part of a training mission. A US Air Force announcement which followed the mission reiterated the US’s commitment to a “free and open Indo-Pacific” – a term which refers to an integrated Indian Ocean and Pacific region and which Beijing views as a containment strategy.
• Deepening rapprochement between China and the Philippines: President Xi Jinping’s twoday visit to the Philippines, the first by a Chinese leader in 13 years, yielded a joint agreement between the two nations on joint oil and gas exploration in the disputed waters of the South China Sea. The oil and gas deal was one of 28 other deals signed between the two nations on bilateral cooperation, investment and infrastructure development. Crucially, both nations also signed a memorandum of understanding to cooperate on the Belt and Road Initiative.
Assessment (1): Trade tensions compounded by geostrategic tussle between US and China
China’s decision to allow the US aircraft carrier to visit Hong Kong and the US response to it are encouraging signs that the two big powers remain committed to prevent an untoward and unintended escalation of military tensions.
Still, the US military’s show of force in the Pacific underscores the long-standing geostrategic tussle between the two powers. The US harbours deep resentment at Chinese efforts to militarize the South China Sea, despite President Xi’s explicit promise not to do so. It also shows that the US remains staunchly committed to challenging Chinese efforts at establishing hegemony in the South China Sea
However, this portends poorly for US-China relations and the outcome of the 90-day trade ceasefire. An aggressive show of force by the US at the time when it is angling for tough trade concessions from China could lead Beijing to conclude that the US has tricks up its sleeve, erasing whatever progress both sides have made on trade.
Should Trump and Xi somehow manage to arrive at a trade deal of sorts – which as we argued above, is highly unlikely – it may not last given this backdrop of intense superpower rivalry and geostrategic tussle.
Assessment (2): ASEAN may contend with a bristlier China
Despite strident anti-China protests at home, the Duterte administration believes that it has more to gain from inching closer to China rather than depending exclusively on a less-than-dependable US.
However, in conceding to joint development of resources in disputed waters, the Philippines has caved into the Chinese strategy of establishing de facto acceptance of its stake in the South China Sea and undermines the Philippines’ claims. Brunei, too, seems inclined to undertake similar deals with China despite conflicting claims as well.
China may feel that its strategy of takeover of reefs and islets in the region and military intimidation coupled with economic blandishments will eventually press the ASEAN nations to accept China’s sovereignty over the disputed areas.
This raises risks to ASEAN of a more aggressive China keen on entrenching hegemonic power over the region, especially in the face of rising hostility from Western powers increasingly united in countering China on multiple fronts.