October 14, 2015

The $ 1.2 TRILLION line China is daring U.S. to cross

Source: CNBC

Journalist: CNBC

As China continues to pour billions into its massive military buildup, a pressing concern is its territorial ambitions in the South China Sea. Within the next two weeks the Pentagon is expected to send U.S. Navy warships to the area that will steam past China's artificial South China Sea islands in the first direct challenge to China's claims in the region.The stakes are high, and the U.S. naval action could drive them higher still. Trillions in global seaborne trade transit the South China Sea each year (including roughly $1.2 trillion in goods bound for U.S. ports), but the vast majority of East Asia's energy resources pass through the Strait of Malacca and South China Sea as well.

The sea itself could also be a source of vast mineral wealth. The U.S. Energy Information Administration estimates that there could be 11 billion barrels of oil and 190 trillion cubic feet of natural gas lurking in the seabed there.If the naval maneuvers are approved, they would mark a material escalation in what, up to this point, has been largely a war of words between U.S. and Chinese officials.During a state visit to the White House last month, Chinese President Xi Jinping and President Obama could not find common ground on this issue.

Xi was defiant in his defense of China's activities in the South China Sea, which include using a fleet of dredging ships to build a string of artificial islands atop various reefs in the region. Those islands have since become home to airstrips, helipads and other infrastructure. Beijing has also claimed the islands and a 12-nautical-mile radius surrounding each one as sovereign Chinese territory.

Read the full article at Malaysian Chronicle.


  • Mira Rapp-Hooper

    Former Adjunct Senior Fellow, Asia-Pacific Security Program

    Mira Rapp-Hooper is a former Adjunct Senior Fellow with the Asia-Pacific Security Program at CNAS. She is formerly a Fellow with the CSIS Asia Program and Director of the CSIS...