Linking the Pacific Ocean to the Indian Ocean, the Eastern Sea faces China to the north, the Philippines to the east, Malaysia, Brunei and Indonesia to the south and Vietnam to the west. It encompasses four major archipelagos - the Pratas Archipelago, the Macclesfield Archipelago, the Hoang Sa (Paracel) and the Truong Sa (Spratly) archipelagos. The area features complex territorial disputes between different countries. On May 7, 2009, China unreasonably and unfoundedly aired for the first time the nine-dotted line map created by the Chinese Nationalist Party (Kuomintang) in 1947 in a bid to claim its ownership of 80 per cent of the Eastern Sea area.

Based on historical evidence and international laws, particularly the United Nations Convention on the Law of the Sea 1982 (UNCLOS), Vietnam has indisputable sovereignty over the Eastern Sea and has handled diverse oil and gas extraction and exploitation, aquaculture, shipping, tourism and scientific research activities over more than one million square kilometres of territorial waters, including the Paracel and the Spratly archipelagos.

The Eastern Sea holds strategic importance to scores of southeastern and northeastern countries and it is a crucial shipping channel through the Straits of Malacca with more than 60 per cent of the world’s energy and fuel transport volumes. The oil and liquefied petroleum gas transport volume through the Straits of Malacca triples that through Suez Channel and is 15-fold more than that through Panama Channel. Each year, Japan ships and receives several hundred million tonnes of goods through the channel (including 70-80 per cent of its imported energy and minerals). This shipping channel is also significant to South Korea, Taiwan (China) and particularly to China. Therefore, the Eastern Sea is naturally a dispute prone and sensitive point.

The Eastern Sea offers bountiful natural resources. Vietnam’s territorial waters on the sea are home to 35 kinds of minerals (metals, gemstones and aggregates). The sea, including the Paracel and the Spratly, also has proven oil reserves. The United States once forecast the sea contained around 28 billion oil and oil equivalent barrels while according to Chinese research bodies it would be around 105-231 billion oil barrels. Recently, China’s Global Times reported the Eastern Sea contained 50 billion tonnes of crude oil, more than 20,000 billion cubic metres of fuel, 25 fold more than China’s current oil deposits and eight times its current fuel deposits.

The Eastern Sea is also bountiful in sea creatures. According to the Vietnam Sea and Islands General Department appraisals, Vietnam’s territorial waters are the habitat of 11,000 sea creatures belonging to 20 diverse ecosystems with six biodiversity areas. Accordingly, there are over 2,000 fish and 230 shrimp species and seafood reserves would amount to around five million tonnes. Annual exploitable capacity would be 1.5-2 million tonnes and many sea areas have great potential for aquaculture.

Vietnam’s sea area also accommodate a number of world’s well-known bays and gulfs such as Halong, Van Phong, Nha Trang and Cam Ranh. Besides, it is home to 2,779 islands with many big ones such as Phu Quoc which covers over 542 square kilometres, bigger than Singapore. Phu Quy and Con Son islands are dubbed as ‘floating fleets’ on the sea. There are also 90 seaports, around 100 venues which can be turned into ports including international transit ports, 125 beaches of which 20 offer wonderful setting with great potential for tourism development.

Besides, a multitude of other economic benefits could not be missed out such as great wind energy potential in coastal and island areas, tide energy and some other clean energy options for future development.

In February 1992, China National Assembly ratified the Marine Code which claimed hegemony over the entire Eastern Sea. China’s nine-dotted line claim stemmed from its stance about the Eastern Sea in the marine code.

In 2010, China became the world’s second power economically behind the US and the third commercially behind the US and Germany. Around 60 per cent of China’s imports go across the Eastern Sea. Annually, China catches millions of tonnes of seafood from the sea.

Given the world market is predominated by developed countries, China as a late comer takes advantage of its tremendous dollar reserves of over $3 trilllion and its far-reaching influence to expand and tap new markets to pace with its sharply rising energy and fuel demands.

In 2009, China outran US to become the largest crude oil importer in the Middle East. In 2010, China gobbled up 439 million tonnes of crude oil, surging 13.1 per cent against 2009 with 260 million tonnes (55 per cent) imported chiefly from the Middle East and North Africa. Amid on-going political unrest in these regions, China National Petroleum Corporation’s former president Chen Geng said: “Uncertainties in North Africa and the Middle East hugely affect China’s oil imports. The loss would be remarkable if the unrest extended any longer since China’s current reserves would be enough for usage in half a month only in case of the supply crisis.”

China, therefore, fostered oil exploration and exploitation activities on the Eastern Sea to ease its dependence on imported sources. According to the US-based Jamestown Foundation, Chinese policy-makers proposed the Chinese administration to pump $30 billion into this country from now until 2020 for energy exploration and extraction on the Eastern Sea.

In late 2010, a joint venture between China National Offshore Oil Corporation (CNOOC) and the UK’s BP Group discovered natural gas when expediting the first trial drill at the depth of around 1,400 metres south of Hainan Island. CNOOC and Canada’s Husky Energy planned to embark on exploration from 2013 after discovering huge oil deposits 3,000m deep below the sea surface. Projects developed by BP, CNOOC and Kuwait Foreign Petroleum Exploration Company on the Eastern Sea, which churn out some 124 billion cubic metres of gases annually, is the main source of Hong Kong-based power generators.

The South Korean newspaper Chosun Ilbo quoted as saying that China spent over $900 million and more than three years on building the Ocean Petroleum 981, a deepwater semi-submersible drilling platform - one of the world’s most advanced super oil rigs - which was put on East China Sea in late May 2011 for trial operations before it will be brought to the Eastern Sea. Its operation costs reportedly amounts to $1 million per day.

Making the most of Vietnam’s strategic position

The 10th Vietnam Communist Party Congress’s Central Committee’s 4th Plenum in 2007 set forth the strategy to turn Vietnam into an affluent marine-based country.

Accordingly, relevant legal documents on marine resources protection and management were enacted, and scores of projects and programmes relevant to marine economy were on the development pipeline covering a wide range of issues from fundamental surveys to protection and management of marine resources as well as international cooperation. These efforts have generated upbeat outcomes. Vietnam’s seafood exports quickly rose in the past five years and it came to $2.13 billion in the year ending May 2011, surging 31.1 per cent on-year. Coastal provinces with stunning resorts and attractive offerings have become investor hotspots. Local communities began to embark on marine resources exploitation in a sustainable manner. State planning and management in this regard saw marked improvements.

However, a number of issues need to be addressed to materialise the sea economy development targets for 2020.

At the Vietnam Marine Economy Forum 2011 in Nha Trang on June 8, 2011 within the ‘Vietnam seas and islands week’ scientists came to a consensus that to achieve the targets of having 53-55 per cent of the GDP and 55-60 per cent of Vietnam’s total export value contributed by the marine economy by 2020, there needed to be a fresh way of thinking. Vietnam’s strategic geographical position and accelerated institutional reforms could create a sustainable living environment in the long-term for Vietnam. The following seven proposals were drafted which were expected to help the country turn these ambitious goals into a reality.

First, current seaport system needs to be revised to ensure social and economic benefits of Vietnamese seaports as well as of 15 licenced coastal economic zones. New economic zones should not be given the go-ahead to avoid distributed investments and land waste. Cautious approach must be taken in developing ocean resorts to prevent land encroachment while delayed projects should have their licences revoked for the sake of the community.

Second, marine economic sectors must be properly structured to avoid triggering conflicts of interest. For instance, natural resources exploitation and ocean tourism development should be linked to sea creature protection and preservation, from there establishing general sea, island and coastal area planning to ensure consistency in implementation.

Third, it is urgent to compile and carry out sea and island development planning at provincial level, put into place sea environment and marine resources’ social and economic benefit appraisal indicator systems with regard to climate change and rising sea water impacts, from there adding more workforce and properly distributing human resources to different regions while putting an end to spontaneous and wasteful extraction of marine, island and coastal resources.

Fourth, coastal areas need to be governed through inter-sectoral policies and mechanisms to ensure sustainable development in pursuit of the overall objective of having 28 coastal locations strictly followed the general management model. Zoning sea areas and decentralising it to local governments, allowing local communities to make use of sea areas under state guidance and supervision are also a must.

Fifth, taking a trial application and multiplication approach in sea space management in respect to sea and island management, managing marine resources and environment based on local communities, working out policies and mechanisms to shield local communities interests to heighten their consciousness in sea and island management.

Sixth, three following key factors in marine economic development must be taken into account: Making public update information relevant to sea, islands and national territory; Developing quality human resources for effective usage and management of marine resources; and adopting suitable state management policies to release marine economic potential for successful implementation of the sea economy development targets.

Seventh, promoting international cooperation particularly with ASEAN countries and those having interests in the Eastern Sea, treasuring the ‘power balance’ principle in dealing with territorial disputes and other unrests, striving to protect national sovereignty and interests in the increasingly complicated world context are all essential.

Successfully accomplishing Vietnam’s marine economy development strategy towards 2020 will not only help turn the country into a modern industrialised nation by 2020, but also significantly enhance its image regionally and globally.

Source: VIR.