Abstract This article focuses on the rising strategic significance of the South China Sea for the Association of Southeast Asian Nations (ASEAN) and the major powers. It traces the origins of the South China Sea (SCS) dispute, and the claimants that are directly involved (China, Vietnam, Philippines, Malaysia, and Brunei). It then examines why balance of power considerations have influenced and continue to influence the role of regional states as well as the major external powers (China, United States, India, and Japan, together with other interested middle powers such as Australia and Canada). It argues that the SCS is an international maritime regime (global commons), and therefore subject to the principles and practice of International Law, specifically United Nations Convention on the Law of the Sea (UNCLOS). Any attempt at nationalisation of the SCS will be rejected under international law, as evidenced by the 2016 decision of the Permanent Court of Arbitration (PCA), with respect to the submission in 2013 by the Philippines on its dispute with China, for compulsory arbitration by the The Hague Court. It notes the lack of unity in ASEAN over how to deal with China’s assertive conduct in the SCS. It suggests that only a dynamic balance of power approach, which includes external power engagement with regional interests, will create the necessary space for diplomacy and dialogue by upholding the primacy of the rule of law, freedom of the open seas, and the legitimate rights and interests of all claimant states. It concludes that law, politics, diplomacy, and deterrence are interactive variables requiring strategic management to promote shared interests, stability and security in the South China Sea.
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