China Brushes Back U.S. Push on Sea Claims as Wen Meets Obama

[American Patriot]

China Brushes Back U.S. Push on Sea Claims as Wen Meets Obama

November 19, 2011, 9:58 AM EST

By Daniel Ten Kate
Nov. 19 (Bloomberg) -- China proposed a maritime cooperation fund and said it has no interest in impeding trade as it counters moves by the U.S. and the Philippines to resolve territorial disputes in the South China Sea.
The 3 billion-yuan ($472 million) fund would develop a “maritime connection network” with Southeast Asian nations, Assistant Foreign Minister Liu Zhenmin told reporters today in Bali, Indonesia. Chinese Premier Wen Jiabao reiterated China’s stance that territorial disputes should be left off the agenda at regional forums and addressed directly between claimants, the official Xinhua News Agency reported.
“China believes that freedom of navigation has not been a factor in the South China Sea,” Liu said at the conclusion of the 18-country East Asia Summit, where U.S. President Barack Obama raised maritime security issues. “With the rapid development of economies in China and East Asian countries, the country and region attach more importance to freedom of navigation than anybody else.”
The remarks aim to dispel concerns that China’s moves to assert its sovereignty in disputed waters would impede trade as Obama pushes to expand commerce and military cooperation on a trip to the region that began Nov. 11. Over the course of Obama’s tour he announced plans to boost troop rotations in Australia and called on China to “play by the rules” as its military might grows.
Liu characterized talks today between Wen and Obama as “very cordial and frank,” while calling the U.S. an “important player” in the region. He also said China is ready to negotiate a legally binding code of conduct in the South China Sea with the 10-member Association of Southeast Asian Nations, four of which have competing claims with China.
‘Freedom of Flow’
White House National Security Adviser Tom Donilon emphasized that commerce is the top U.S. motive for weighing in on the South China Sea’s territorial disputes as he summarized Obama’s trip today, while declining to note any “specific instances” when trade was impeded.
“The United States interest here is in the freedom of flow in commerce,” he said. While the U.S. “doesn’t have a claim” in territory disputes, “we do believe that there should be developed a collaborative diplomatic process for the resolution of these claims.”
The Philippines and Vietnam, which have awarded exploration contracts to Exxon Mobil Corp., Talisman Energy Inc. and Forum Energy Plc, reject China’s map of the sea as a basis for joint development. The South China Sea contains oil reserves that may total as much as 213 billion barrels, according to Chinese studies cited in 2008 by the U.S. Energy Information Agency.
China’s Tone
The tone of China’s response in today’s meeting encouraged Obama’s administration, according to a U.S. official who briefed reporters aboard Air Force One. The official said 16 of 18 leaders at the East Asia summit in Bali addressed the issue of maritime security in the South China Sea, and that China’s Premier Wen discussed the issue after it was raised by Obama.
The U.S. feels that the Chinese came away from the meetings believing that a heavy-handed approach on the South China Sea would backfire, the official said.
China has used patrol boats to disrupt hydrocarbon survey activities in waters it claims, chasing away a ship working for Forum Energy off the Philippines in March and slicing cables of a survey vessel doing work for Vietnam in May.
Japanese Prime Minister Yoshihiko Noda, one of the 18 leaders attending the event, joined the U.S. in emphasizing the importance of rules at sea, saying efforts were being increased to boost security.
‘International Law’
“We were able to convey the importance of international law,” Noda said in press conference in Bali today.
China’s gentle response to the comments and agreements during Obama’s trip may be temporary, said Gary Li, an analyst with Exclusive Analysis Ltd., a London-based business advisory firm.
“In circumstances when they are outnumbered diplomatically, and with the U.S. hovering on the sidelines like a school prefect, China usually goes back into its shell,” he said. “Fundamentally, they are not going to change positions on bilateral talks over multilateral being the preferred way of doing business.”
During his trip Obama called the East Asia summit the “premier” arena to discuss maritime security concerns, a subject China has lobbied to keep out of international gatherings because it touches on territorial disputes. The Philippines, a U.S. treaty ally, has called on Asean to facilitate talks with China over disputed areas of the sea that contain oil and gas resources.
Asserting Sovereignty
The U.S. presence “bolsters our ability to assert our sovereignty over certain areas,” Ricky Carandang, a spokesman for Philippines President Benigno Aquino, said Nov. 17.
Secretary of State Hillary Clinton said Nov. 16 in Manila that the U.S. would bolster the Philippines naval defenses and work to ensure there isn’t a “big thumb on the scale” that pushes development or strategic issues.
In a news conference in Canberra, Australia, on Nov. 16, Obama said that it is “mistaken” to say the U.S. fears China or is seeking to isolate the world’s most populous nation.
“The main message that I’ve said not only publicly but also privately to the Chinese is that with their rise comes increased responsibilities,” Obama said. “It’s important for them to play by the rules of the road.”
--With assistance from Patrick Harrington in Tokyo and Julianna Goldman and Margaret Talev in Washington. Editors: Patrick Harrington, Dylan Griffiths
To contact the reporter on this story: Daniel Ten Kate in Bangkok at dtenkate@bloomberg.net
To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net

[American Patriot]

WRAPUP 5-China rebuffs U.S., Asia pressure in sea dispute






Sat Nov 19, 2011 9:46am EST

* China pushes back on sea dispute after U.S. pressure
* Underlines view against multilateral talks on dispute
* U.S. says China's heavy-handed approach will backfire
* Caps major diplomatic push by Obama to court Asia region


By Ben Blanchard and Laura MacInnis
NUSA DUA, Indonesia, Nov 19 (Reuters) - China pushed back on Saturday against a week of U.S. pressure to resolve a rancorous dispute over territorial claims in the South China Sea, a crucial, mineral-rich commercial shipping lane at the heart of growing tensions among Asian leaders.


Chinese Premier Wen Jiabao chastised President Barack Obama for raising the issue during an Asia-Pacific leaders summit, hours after Obama told Wen the United States wants the sea lanes kept open and peaceful, capping two weeks of Sino-U.S. tensions.
Vietnam, the Philippines, Taiwan, Malaysia and Brunei all have claims to parts of the sea lanes, while China claims large parts of the region, which might hold rich deposits of oil and gas.
Obama ended a nine-day trip with a meeting with Wen where, according to U.S. officials, he raised U.S. concerns over festering economic issues such as China's currency policy, after huddling with Asian leaders in a concerted effort to court the world's fastest-growing region.
U.S. lawmakers have long argued Beijing keeps the value of the yuan down to help drive the country's exports engine, a stance they say costs American jobs.
Wen defended Beijing's currency stance, stressing that from late September to early November, offshore foreign exchange markets showed "expectations of a depreciation in the renminbi exchange rate" and that China will also strengthen the renminbi's trading flexibility in either direction, without elaborating.
But it was Obama's comments on the South China Sea, a possible flashpoint in Asia, that drew Beijing's ire.
Wen said the South China Sea issue should be resolved directly among related sovereign countries "through friendly consultation and negotiation", state-owned news agency Xinhua reported, a comment that suggests U.S. exclusion from the dispute.
He added that the East Asia Summit on the Indonesian island of Bali, where Obama met with 17 Asia-Pacific leaders in three days of talks, was not "a proper occasion" to discuss the issue.
Still, a briefing by a U.S. official said 16 leaders present at the summit addressed maritime security. Indeed, the bulk of the discussions were a "very robust" conversation on maritime security and the South China Sea, the official said.
"The Chinese will come away from the meeting believing that a heavy-handed approach on the south china sea will backfire badly," said the official.
But Xinhua, in an English language commentary, warned that "any attempt by outside forces to internationalise the issue will only make it more complicated and undermine peace and stability in the region", in a veiled reference to the United States.
Tensions flared earlier this year with often tense maritime stand-offs in the sea that carries some $5 trillion a year in world trade. U.S. Secretary of State Hillary Clinton earlier this week warned claimants against using intimidation to back their claims, an indirect reference to China.
An Australian think tank warned in June that risk-taking behaviour of the Chinese military, the resource needs of the fast-growing economy and its greater assertiveness raised tensions and could spark a conflict that could draw in the United States and other powers.
China wants to hold bilateral talks with other countries that claim parts of the South China Sea as their territory, but the Southeast Asian claimants, the United States and Japan are pushing for a multilateral approach.
The United States had been "quite direct with the Chinese about our strategy", said Tom Donilon, Obama's top national security adviser.
Beijing understood that Washington was serious about sustaining a more active presence in the region to help its stability and peace, he said.
"Our partners and allies look to us for that reassurance. They want to know that the United States is going to play the role it has played with respect to security and reassurance and balancing and stability here," he said.
Still, he said Washington was pursuing deep engagement with China to manage a range of U.S.-Chinese issues.
"We have a very complicated and quite substantial relationship with China across the board," he said, adding that while the United States does have "economic issues" with Beijing, "our relationship with China has in the main been productive and constructive".
INFLUENCE
The summit capped two weeks of a hard diplomatic push by Obama to reassert America's footprint in the Asia Pacific, which will fuel China's fear of being encircled, or contained by the United States and its allies.
However, Obama on Thursday acknowledged China's unease, pledging to seek greater cooperation with Beijing. And Clinton told America's ABC television: "It's not about countering anybody else's power. It's about asserting our own position as a Pacific power."
On Thursday, Obama said in Australia that the U.S. military would expand its Asia-Pacific role, declaring America was "here to stay" as a Pacific power.
Days earlier, as host of the Asia Pacific Economic Co-Operation forum in Hawaii, Obama had voiced growing frustration at China's trade practices. He declared "enough is enough" as he pushed for a new Asia-Pacific trade deal with some of Beijing's neighbours.
However, China has adopted a largely restrained response to the expansive moves by Washington.
"The U.S. has been an important player in Asia ever since the Second World War. We are looking forward to cooperating with them, with the U.S., in the region," China's Assistant Foreign Minister Liu Zhenmin told reporters in Bali.
Obama also announced on Friday that he would send Clinton to Myanmar next month, which has drawn closer to China in reaction to Western sanctions.
It will be the first such trip to the isolated country in half a century and will add to Beijing's fears of encirclement.