In its effort to reconcile the relations between Japan and the Taiwan authorities for better US strategic deployment in the APAC region, the United States presided over the signing of the Treaty of Peace between Japan and the Republic of China in 1952. Article 2 of the document provided that "It is recognized that under Article 2 of the Treaty of Peace which Japan signed at the city of San Francisco on 8 September 1951 (hereinafter referred to as the San Francisco Treaty), Japan has renounced all right, title, and claim to Taiwan (Formosa) and Penghu (the Pescadores) as well as the Spratly Islands and the Paracel Islands." Indeed, the United States and Japan deemed the Taiwan authorities as China’s legitimate government to take over China’s rightful territories in the South China Sea forcibly seized by Japan.
Disputes during the Cold War
Since mid-1950s, the Philippines and South Vietnam started their encroachment of the Nansha Islands. In 1956, Tomas Cloma, a Filipino adventurer announced his discovery of a group of islands in the Nansha waters, and renamed them "Freedomland". Shortly after, the Philippine government argued that these Islands should belong to their country on the grounds of the "Cloma discovery", and threatened to take over the islands immediately. Obviously aware of the Taiwan authority’s position on the sovereignty over the islands, Manila even intended to send a delegation to Taiwan to discuss the matter. [iv] Since 1962, South Vietnam occupied Nanzi Cay (South West Cay), Dunqian Cay (Sandy Cay), Hongxiu Island (Namyit Island), Jinghong Island (Sin Cowe Island), Nanwei Island (Spratly Island), and Anbo Cay (Amboyna Cay), which was strongly objected and protested by both sides of the Taiwan Straits.
A bigger wave of encroachment happened in the 1970s and 1980s, under the influence of the discovery of rich oil and gas reserves on the continental shelve of the South China Sea by the US and a number of UN survey agencies in the late 1960s, and the signing of the United Nations Convention on the Law of the Sea (the Convention) in 1982, which introduced the 200 nautical mile exclusive economic zone (EEZ) regime.
Greatly incentivized by a high potential for resource exploration, Vietnam, the Philippines and Malaysia set their sights on islands and reefs in the Nansha Islands.
North Vietnamese regime had openly recognized China's sovereignty over the South China Sea islands, but soon abandoned this policy after its unification of Vietnam. [v] In 1975, North Vietnam, on the pretext of "liberation", occupied six islands and reefs of the Nansha Islands which were formerly seized by South Vietnam. Later, it seized another 18 islands and reefs, including Ranqingsha Reef (Grierson Reef) and Wan’an Bank (Vanguard Bank). On March 14, 1988, Vietnam had a skirmish with China in waters near China’s Chigua Reef (Johnson South Reef).
The Philippines occupied 8 islands and reefs, including Feixin Island (Flat Island) and Zhongye Island (Thitu Island); Malaysia seized Danwan Reef (Swallow Reef), Nanhai Reef (Mariveles Reef) and Guangxingzai Reef (Ardasier Reef).
At the same time, these countries dramatically altered their original stance on the issue of the Nansha Islands. By formulating national laws of the sea and issuing political statements, they officially asserted sovereignty over the Nansha Islands and made claims on the territorial waters surrounding the Nansha Islands.
At the same time, US clearly demonstrated its acknowledgment of China’s sovereignty over the Nansha Islands in its diplomatic inquiries, measurement requests and flight plan notifications. In addition, the Taiwan authorities have also received the American military personnels on Nansha Island where it stationed forces. For a long period of time, the US remained silent to the encroachments by the Philippines and Vietnam, but it did consulted the Taiwan authorities on many occasions related to the sovereignty issue over these islands and reefs. [vi] From February 1957 to February 1961 the US Government made multiple application requests to the Taiwan authorities to allow the US Air Force based in the Philippines to conduct nautical chart measurement and meteorological surveys in the vicinity of Huangyan Island (Scarborough Reef) and the Nansha Islands, obviously acknowledging China's sovereignty over these islands through the role of the Taiwan authorities. Such acknowledgment was confirmed in books and maps published around this time such as Columbia Lippincott Gazetteer of the World (1961), Worldmark Encyclopedia of the Nations (1963), and Constitutions of the Countries of the World (1971), all of which clearly state that the Nansha Islands belong to China. Indeed, the US policy-makers faced a dilemma at that time: on one hand, out of a moral commitment to its Chinese Nationalist ally in Taiwan, and in accordance with international law, the US should have announced these features as Chinese territory; on the other hand, out of its anti-communism policy and Asia-Pacific strategy, it could not possibly recognize Mainland China as their rightful owner, nor did it want to hurt its relations with its important allies, such as the Philippines, through such recognition.
As far as China is concerned, over the years, only the Taiwan authorities had station forces on Taiping Island. It’s not until the late 1980s in the 20th century when the mainland China started to take control over six minor islands and reefs. In 1994, China built fishery and sheltering facilities on Maiji Reef.
The Road to the Declaration on the Conduct of Parties in the South China Sea
In the early 1990s, as the Cold War came to an end, the relations among the countries began to reconcile and economic development became the primary focus in the APAC region, China switched to a fast track toward establishing rapport with Southeast Asian countries and the Association of Southeast Asian Nations (ASEAN). In 1990, it established official diplomatic relations with Singapore and resumed diplomatic ties with Indonesia. A year later, China launched a dialogue process with ASEAN, and in 1992, it started dialogue with ASEAN.
China then embarked on a path of confidence-building and all-round cooperation with ASEAN, guided by its new foreign policy of realizing and maintaining stability in Southeast Asia. In spite of all these developments, sovereignty over the Nansha Islands remained the most frequently debated issue between China and its ASEAN neighbors. China, based on its historical ownership of these islands and widely-recognized international documents, consistently defended its indisputable sovereignty over them as it had done in the past. On the other hand, China decided to copy here its policy of "setting aside dispute and pursuing joint development",[vii] which was practiced over the Diaoyu Island of the East China Sea, for the sake of cooperation and regional stability. However, China made clear this did not mean renouncing its sovereignty over Nansha Islands.
In 1994, China normalized its diplomatic relations with Vietnam. In 1995, ASEAN's membership extended to 10 countries with the admission of Vietnam, Myanmar, Laos and Cambodia. In 1996, China became ASEAN's full dialogue partner, and in the 1997 Asian Financial Crisis, China lived up to being a responsible partner, winning wide praise and greater trust from ASEAN countries. In 1997, the first China-ASEAN Informal Summit was held in Kuala Lumpur, Malaysia, at which both sides announced the establishment of "a 21st century-oriented partnership of good neighborliness and mutual trust".
Throughout the 1990s, the rapid development of the China-ASEAN relations largely masked seething contention in the South China Sea; nevertheless, disputes surfaced from time to time.
A major development was a new wave of unilateral occupation of the Nansha Islands and development of oil and gas in surrounding waters by some countries. Entering the 1990s, Vietnam occupied 5 more reefs, bringing a total of 29 islands and reefs under its control. By March 1994, Vietnam had illegally licensed out 120 oil blocks in the bulk of the Nansha and Xisha waters through bidding rounds. Malaysia seized Yuya Shoal (Investigator Shoal) and Boji Reef (Erica Reef) in 1999, and has been actively exploiting oil and gas and fisheries resources in surrounding waters. It accounted for half of the oil rigs among the disputed parties in Nansha areas, and its maritime law enforcement made the largest number of expulsions and arrests of Chinese fishermen in the 1990s.
The Philippines also orchestrated a number of provocations on China’s Meiji Reef (Mischief Reef), Huangyan Island, and Ren’ai Shoal (Second Thomas Shoal).
The most extreme behavior was in reaction to China’s 1994 installation of fishery facilities and shelters on Meiji Reef. The Philippine Navy, in late March of the following year, blew up survey markers that China had installed on Wufang Atoll (Jackson Atoll), Xian’e Reef (Alicia Annie Reef), Xinyi Shoal (First Thomas Shoal), Banyue Shoal (Half Moon Shoal) and Ren’ai Shoal. Supported by Philippine Air Force planes, it also launched a raid on four Chinese fishing vessels working near Banyue Shoal, detaining 62 Chinese fishermen on board. On May 13, the Philippine military attempted to escalate the dispute by sending warships and planes to Meiji Reef, which then started an 8-hour standoff with the China Fisheries Law Enforcement Command’s No. 34 boat patrolling the surrounding waters. Regardless of the attacks and confrontations, China completed the installations.