Philippine aerial surveillance photo of Chinese construction at Fiery Cross Reef in Spratlys

Beijing’s dilemma in the South China Sea

  • China is unlikely to back down after losing court case on South China Sea dispute
  • Beijing’s options include military posturing, economic carrots and back-channel diplomacy
  • Main risk for China is strained regional relations and international outsider status

China’s territorial ambitions in the South China Sea suffered a crucial setback in early July, when an international court in The Hague ruled overwhelmingly in favor of the Philippines in the two countries’ territorial dispute. While the ruling is unenforceable, it will have an indirect impact on Chinese foreign policy and the geopolitics of the Asia-Pacific region for years to come.

Manila had filed a complaint against Chinese activity in the South China Sea after Beijing made territorial claims to about 90 percent of the area, and built artificial islands to further those claims. Perhaps the most important part of the tribunal’s ruling was its statement that any possible historical Chinese claims to the South China Sea under the country’s so-called “nine-dash line” became invalid when the country signed up to the United Nations Convention on the Law of the Sea (UNCLOS).

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 Joseph Dobbs
The United States has urged Asian countries not to act quickly on the court’s ruling
read more about it in the report
What's inside
  • China is unlikely to back down after losing court case on South China Sea dispute
  • Beijing’s options include military posturing, economic carrots and back-channel diplomacy
  • Main risk for China is strained regional relations and international outsider status
Who will benefit?
  • Report is targeted to the decision makers in cross country manufacturing – suppliers, manufacturers, logistics.
  • Also considered useful for the administrative university facilities, to better understand the possibe effects of current decisions.
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