Asia: Vietnam outraged over China’s oil plans; US to stress cooperation with China at ASEAN Regional Forum [Updated]

Updated On: Jun 28, 2012

Tensions continue to mount between Vietnam and China. The Chinese Defense Ministry has said that it has established military presence around a disputed group of islands in the South China Sea. The move comes in response to Vietnam sending air patrols over the Spratly Islands last week. According to Ministry spokesman Geng Yansheng, China will "resolutely oppose any military provocative behavior", and that actions were taken "in order to protect national sovereignity and...security and development interests".


Earlier this week, China National Offshore Oil Corp (CNOOC) announced that it was issuing exploration rights to nine offshore blocks located within the South China Sea and invited foreign companies to make bids.  The blocks, which are situated right next to Vietnam, lie within the 200-nautical-mile exclusive economic zone granted to Vietnam under the UN’s Law of the Sea.

The move was denounced by Vietnam as “illegal and of no value”. In a statement released by Vietnam’s foreign ministry, Vietnam pointed out that the blocks lie within its exclusive economic zone. It said that the zone “is absolutely not a disputed area”, and accused CNOOC of “seriously violating Vietnam’s sovereignty”. Vietnam’s state-run PetroVietnam also urged China to cancel the bidding, and requested that foreign firms not get involved in the matter.

However, Chinese foreign ministry spokesman Hong Lei insisted that the tender was “normal business activity”. According to him, China hopes that Vietnam will respect its agreements and avoid taking any action that may complicate the matter. He added that Vietnam should stop “oil and gas acitivities that infringe on rights in relevant sea waters”. Leaked US diplomatic cables supposedly report that China has been pressing international oil companies like BP and ExxonMobil to withdraw from oil and gas exploration deals with Vietnam.

This spat comes in the wake of other disagreements over the South China Sea. Just recently, tensions between China and the Philippines rose significantly after the Philippines Navy accused Chinese boats of fishing illegally around Scarborough Shoal.

The South China Sea has been a thorn in the relationships between China and other Asian countries for many decades. China currently claims sovereignty over most of the sea, which is believed to contain large amounts of oil and gas deposits.

In related news, another issue of concern plaguing the region has been the growing influence of both China and US in Asia. Countries in Southeast Asia have been especially wary of getting caught in the superpower rivalry.  

It should thus come as some relief for most countries that the US and China plan to unveil new cooperation initiatives at the ASEAN Regional Forum (ARF) in Cambodia next month. Kurt Campbell, assistant secretary of state for East Asian and Pacific Affairs, has said that the US will stress “engagement and cooperation” with China. The initiatives will include cooperation on humanitarian disaster relief and wildlife protection fronts.

Mr Campbell added that although China and the US will have “areas of differences”, “it will be important to send a very clear message…that [the US wants] to build a strong, durable partnership with China”.

The South China Sea disputes will be brought up at the ARF as well.

Report: China-Vietnam row hits energy groups [Financial Times, 27 June 2012]

Report: Vietnam spars with China over oil plans [Wall Street Journal, 27 June 2012]

Report: US to highlight China cooperation at ASEAN forum [Reuters, 27 June 2012]

Report: China vows to oppose military provoation [AFP, 28 June 2012]

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