As President Obama heads to Beijing for the APEC summit next week, Harry J. Kazianis, Managing Editor of the National Interest, spoke with Dr. Ely Ratner, a Senior Fellow at the Center for a New American Security to discuss U.S.-Chinese relations, China-Japan relations, the Trans-Pacific Partnership and more.

Editor’s Note: Please see an excerpt from Dr. Ratner’s recent article in TNI, “Learning the Lessons of Scarborough Reef.” You can read the full article here.

On the evening of June 15, 2012, the Philippines conceded a dramatic ten-week standoff to China by withdrawing its maritime vessels from the waters surrounding Scarborough Reef, a group of tiny outcrops 120 miles west of Subic Bay. Like many islands and rocks in the South China Sea, the sovereignty of Scarborough Reef is contested by multiple claimants, in this case China, the Philippines and Taiwan. And although Asian leaders are quick to eschew notions of zero-sum competition, there was no question that Beijing had scored a tactical victory at Manila’s expense by successfully seizing and occupying the disputed area.

The crisis could have led to regional war. Dozens of government vessels and fishing boats were floating in dangerously close proximity to the reef in the context of contested territory and restive publics. But more profoundly, the standoff at Scarborough Reef demonstrated that U.S. efforts to deter Chinese assertiveness were not working. Soon after the Philippines departed the reef, Chinese officials and pundits began speaking of a “Scarborough Model” for exerting regional influence and annexing disputed territories. Inspired by events, leading Chinese scholars are now exploring strategies of “extended coercion” (a play on extended deterrence) through which China could pressure U.S. allies while keeping Washington at bay.

More Chinese coercion in the South China Sea would run counter to U.S. interests. In addition to threatening regional peace and prosperity, it would raise further questions about America’s staying power in Asia and sow serious doubts about the value of partnering with the United States.

As China draws lessons from its standoff with the Philippines and looks to employ similar methods elsewhere, so too must the United States learn to check this behavior by understanding exactly what happened at Scarborough Reef, why Chinese coercion was so effective, and what can be done differently in the future.

THE crisis was born when a Philippine Navy surveillance plane detected eight Chinese fishing vessels near Scarborough Reef on April 8, 2012. As suspected, they were found with illegal and endangered giant clams, corals and live sharks, in violation of Philippine law. The Philippines then deployed the BRP Gregorio del Pilar, a decommissioned U.S. Coast Guard cutter, to arrest the fishermen. What the Philippines reconnaissance plane had failed to see, however, was that Chinese maritime-surveillance vessels were also in the area. Despite the fact that the Philippines regularly uses naval vessels for interdiction operations (necessary because of its limited number of combined navy and coast guard ships), the Chinese acted incensed that the Philippines had employed a military vessel for law-enforcement activities.

Accusing Manila of militarizing the dispute, Beijing engaged in what scholar Stephanie Kleine-Ahlbrandt has aptly termed “reactive assertiveness,” quickly dispatching maritime vessels to prevent the Philippines from detaining the fishermen. With government ships squaring off at the shoal, the countries became locked in a face-to-face test of sovereignty.

Demanding that the Philippines immediately withdraw, China rapidly escalated the dispute by matching and then greatly outnumbering the few Philippine vessels that had arrived to relieve its frigate. Chinese maritime vessels, reportedly working in concert with private fishermen, then took the extraordinary step of erecting a rope barrier across the mouth of the C-shaped lagoon, which first trapped Filipino fishermen inside the reef and then blocked their re-entry once they were permitted to exit. All the while, People’s Liberation Army Navy (PLAN) vessels were floating over the horizon, sending Manila an ominous message not to make trouble.

Beijing took to economic coercion as well, announcing unprecedented inspections of Philippine bananas that were left to rot on Chinese ports. A widespread travel ban drastically cut the number of Chinese tourists visiting the Philippines.

As the standoff grew tenser, traditional diplomatic channels yielded few results. That communications were poor between Beijing and Manila was partially due to circumstances that had nothing to do with the crisis. The Philippines had yet to fill its vacant ambassadorship to China and the Chinese ambassador to the Philippines was considered ineffective and out of sync with Beijing.

Further complicating matters, the lead Chinese diplomat in Beijing, Vice Foreign Minister for Asia Fu Ying, happened to have been China’s ambassador to the Philippines in 1999 when China had provocatively advanced its claims in the South China Sea by building a military installation on the disputed Mischief Reef (which it had seized in 1995). As one Philippine official observed: “If there’s anyone who knows how to steal islands, it’s she.” Attempts to develop credible back channels between Manila and Beijing failed to gain traction.

The two governments’ inability to talk to each other implicated the United States as the default interlocutor and referee. Both began their own private negotiations with U.S. officials, who then had to relay messages back and forth between the sides.

Although China was loathe to call the United States a mediator, Beijing was imploring Washington to pressure the Philippines to back down, describing the leadership in Manila as emotional, unpredictable and emboldened to reckless adventurism by announcements from President Obama and his cabinet that the United States was rebalancing attention and resources to Asia.