The South China Sea is a semi-enclosed portion of the western Pacific bounded by China to the north, Vietnam to the west, the Philippines to the east, and the island of Borneo (shared by Brunei, Indonesia, and Malaysia) to the south.  The sea also incorporates two largely uninhabited island chains, the Paracels and the Spratlys. Long an important fishing ground, it has also been a major avenue for commercial shipping between East Asia and Europe, the Middle East and Africa. More recently, it acquired significance as a potential source of oil and natural gas, large reserves of which are now believed to lie in subsea areas surrounding the Paracels and Spratlys.
With the discovery of oil and gas deposits, the South China Sea has been transformed into a cockpit of international friction.  At least some islands in this energy-rich area are claimed by every one of the surrounding countries, including China — which claims them all, and has demonstrated a willingness to use military force to assert dominance in the region. Not surprisingly, this has put it in conflict with the other claimants, including several with close military ties to the United States.  As a result, what started out as a regional matter, involving China and various members of the Association of Southeast Asian Nations (ASEAN), has become a prospective tussle between the world’s two leading powers.
To press their claims, Brunei, Malaysia, Vietnam, and the Philippines have all sought to work collectively through ASEAN, believing a multilateral approach will give them greater negotiating clout than one-on-one dealings with China. For their part, the Chinese have insisted that all disputes must be resolved bilaterally, a situation in which they can more easily bring their economic and military power to bear.  Previously preoccupied with Iraq and Afghanistan, the United States has now entered the fray, offering full-throated support to the ASEAN countries in their efforts to negotiate en masse with Beijing.
Chinese Foreign Minister Yang Jiechi promptly warned the United States not to interfere.  Any such move “will only make matters worse and the ­resolution more difficult,” he declared. The result was an instant war of words between Beijing and Washington.  During a visit to the Chinese capital in July 2011, Chairman of the Joint Chiefs of Staff Admiral Mike Mullen delivered a barely concealed threat when it came to possible future military action.
 “The worry, among others that I have,” he commented, “is that the ongoing incidents could spark a miscalculation, and an outbreak that no one anticipated.”  To drive the point home, the United States has conducted a series of conspicuous military exercises in the South China Sea, including some joint manoeuvres with ships from Vietnam and the Philippines.  Not to be outdone, China responded with naval manoeuvres of its own.  It’s a perfect formula for future “incidents” at sea.
The South China Sea has long been on the radar screens of those who follow Asian affairs, but it only attracted global attention when, in November, President Obama travelled to Australia and announced, with remarkable bluntness, a new US strategy aimed at confronting Chinese power in Asia and the Pacific.  “As we plan and budget for the future,” he told members of the Australian Parliament in Canberra, “we will allocate the resources necessary to maintain our strong military presence in this region.”  A key feature of this effort would be to ensure “maritime security” in the South China Sea. While in Australia, President Obama also announced the establishment of a new US base at Darwin on that country’s northern coast, as well as expanded military ties with Indonesia and the Philippines. In January, the president similarly placed special emphasis on projecting US power in the region when he went to the Pentagon to discuss changes in the American military posture in the world. Beijing will undoubtedly take its own set of steps, no less belligerent, to protect its growing interests in the South China Sea.  Where this will lead remains, of course, unknown.  After the Strait of Hormuz, however, the South China Sea may be the global energy chokepoint where small mistakes or provocations could lead to bigger confrontations in 2012 and beyond.