Redefining hard power in the South China Sea

The politburo of the People’s Republic of China can be characterized as an active brand of centralized national socialism, as opposed to, say, political parties operating under more passively designed systems of disaggregated liberal democracies typical of modern federal states.  

To maintain social cohesion and stability, Beijing must be able to sustain an annual GDP growth rate ideally beyond 6 percent, with all other things equal. This benchmark is becoming harder for Beijing to attain.  

The fact that China and China’s markets abroad are experiencing maturing economies of scale, Beijing’s technocrats are forced to turn to harnessing economic levers outside traditional aggregated macroeconomic data in the name of maintaining social stability. 

To be sure, there are empirical claims which attempt to trace causal links between social stability and economic growth. Balanced growth theories tend to incorporate softer indices in economic analysis, from concepts as grand as “human development,” to lower level concepts along the lines of “sales promotion.”  All said, balanced models avoid a singular reliance on aggregated macroeconomic data.  

Purist views, on the other hand, have the advantage of claiming near universal application. If China has become the second largest economy today, measured in terms of GDP, the more important question is, will this economy last long enough for it to see the gains of its external political agenda, particularly its territorial claim over the entire South China Sea?  Will China in this case as well as in all other territorial disputes be able to continue asserting itself as a single coherent political unit in the years and decades to come?

Social cohesion

China’s first-quarter year-on-year growth has slowed to 7%, from 7.3% in the fourth quarter, and it is much lower than the 14% GDP growth rate it registered in 2007.  What is more, GDP figures do not reveal the background workings of social stability indices.  

Social cohesion indices are important, even with – and especially for – an economy boasting a large military, as in pre-collapse Soviet Union circa 1988. Because economists everywhere expect that China’s growth will continue to slow, as its population continues to grow, social cohesion indices will become the principal analytical device for those who wish to predict how effective Beijing’s projection of power overseas can be in the long run. Under this theory, the greater a country’s social stability from within, the better chances it will have in projecting political power extraterritorially. 

Social cohesion indices include empirical descriptions of the existing state of cooperation and nondiscriminatory treatment between and among ethnic, religious, and cultural groups; whether labor and capital are working together in harmony; the incidence of violence and the causes thereof; and the existence of caste systems.  

Soft power

Once the results of the arbitration case between the Philippines and China do come out, social indices and soft power analysis will find real life application. 

In 2013, the Philippines initiated an arbitration case to contest China’s “nine-dash line” claim over the South China Sea, with the International Tribunal for the Law of the Sea (ITLOS), naming the Permanent Court of Arbitration at The Hague as principal venue. 

While Philippine authorities remain hopeful, in a prior article we discussed why the Philippines can enforce any such favorable judgment only indirectly, and, even if armed with an award issued by a UN court, still much more needs to be done by way of building international consensus over the Philippine position.  Even if a judgment is rendered by a disinterested international court, this judgment will not bind China, but it will be binding to the Philippines.  

This would seem that all the hard work put into the lawsuit will be all for naught.  

For one, analyzing any favorable judgment only in terms of its face value tends to mask the real precedential value of that judgment. After all, a victory for the Philippines will be a victory for all the other claimants in the South China Sea.  Claimants such as Brunei, Indonesia, Malaysia, and Vietnam, do not differ in legal theory (UNCLOS), nor do they differ in the application of UNCLOS rules (200 nautical mile exclusive economic zone).  

Claimants differ only, or for the most part, on where they draw their maritime baselines and on the probative value of evidence supportive of their baselines, whether by historical title, custom, or effective control.  A judgment in favor of the Philippines will be used as binding precedent for all other claimants, in all other circumstances, and for all other venues and courts.  

Because the Philippine case against China is more often than not appreciated only as a bilateral legal suit, one exclusively between the Philippines and China only, this understates the cumulative effects of international judgments once it is released, posted, and cascaded through official channels.  

Self-defense

If and when this happens, a combined assertion of soft power by all claimants to the South China Sea disputes can make a profound impact upon Beijing. Barring Security Council “Chapter 7” enforcement measures which are subject to China’s veto power, smaller states can enforce international covenants through regional bodies, by individual and collective self-defense, and through the imposition of countermeasures, whether unilateral or multilateral in character.  

In short, on top of defense pacts, injured states may unilaterally resort to countermeasures.  Typically cast in terms of soft power principles, countermeasures are state-sponsored reprisals falling short of armed force. Sometimes countermeasures are used interchangeably with ‘sanctions’, although the latter is more associated with economic and financial sanctions.  In and of themselves illegal, countermeasures become permissible when executed by one state in response to the commission of an earlier illegal act by another state.

Unlike the deployment of an armed force, countermeasures have the edge of being deployed cumulatively, unilaterally and in a disaggregated manner, and by different state actors under different timetables. Not only will the Philippine government be better off with an UNCLOS award, than without, pretty much all other ASEAN member-states who are privy to the South China Sea disputes can benefit from the same award, by referencing that award whenever they do end up imposing sanctions upon China.

Historically, countermeasures include diplomatic sanctions and removal of diplomatic ties, cancelation of high-level government visits and multilateral conferences, economic sanctions such as import or export bans, freezing of assets and other financial sanctions, and trade embargos.  Sanctions can also be imposed upon a class of individuals as in the case of the U.S.’s Magnitsky Act of 2012, or amount to a loss of the right to travel, a loss of standing for sensitive political rights such as the right to hold a dual passport, loss of other individual economic rights and privileges, and public condemnation and public sanction. 

A concerted cumulative impact of a full range of countermeasures may cause Beijing to rethink its global posturing.  If a combined exertion of countermeasures, even if disparate, can effectively weaken Beijing’s levers of internal social control, it will be forced to compensate by way of raising GDP to even greater levels.  

To do this, Beijing must be able to generate even more economic activity amidst the tide of maturing economies of scale, as well as raise its international business standing.  It must double its efforts on infrastructure spending and boost aggregate demand. 

It must subject its currency, the Yuan, to an eventual, abrupt devaluation consistent with its real value.  In the heat of combined US and ASEAN anti-Chinese rhetoric, this will be an impossible task.  Even with increasingly sensitive social ties holding its population together, China has yet to come to terms with the fact that it needs the international economy as much as it values its own survival.  

Because the South China Sea strikes so close to home, Beijing tends to treat problems in this part of the world with greater sensitivity than, say, Chinese investments in Africa.  

In the end, China is faced with the awkward and odd fact that it is forced to pump prime its economy – already supply-driven – in order to keep being the assertive giant it projects itself to be.  This is sure-lose posturing, and China only has itself to blame. – Rappler.com

 

Edsel Tupaz is a public interest attorney and teaches comparative law in Manila. He is a graduate of Harvard Law School and Ateneo de Manila. Follow Edsel Tupaz on Twitter: www.twitter.com/edseltupaz