Xi Calls for Boosting China’s Navy as Army Marks Anniversary

President Xi Jinping called for China to bolster its maritime forces while using peaceful means to settle disagreements, as the country seeks to balance its push for greater influence in Asia against its territorial claims.

To be able to deal with a variety of “complex situations,” China must improve its ability to safeguard its maritime rights, Xi said during a study session before the 86th anniversary today of the founding of the People’s Liberation Army, according to the official Xinhua News Agency.

China will stick to the path of peaceful development yet “in no way will the country abandon its legitimate rights and interests, nor will it give up its core national interests,” Xi said.

China sent ships from its new integrated Coast Guard to islands disputed with Japan in the East China Sea last month, as Vietnam said a Chinese vessel chased two fishing boats near the Paracel Islands on July 7, the third reported clash between the two countries this year. China’s neighbors have voiced concern about maritime tensions and the country’s role in the region more broadly, with the Philippines boosting military ties with the U.S. and Japan and seeking United Nations arbitration on its territorial dispute with China.

Common Interests

China wants to focus on common interests with other nations in the South China Sea to prevent disputes turning into conflicts, according to Jian Zhang, a senior lecturer in the International and Political Studies Program at the University of New South Wales in Canberra. Holding a Politburo meeting on maritime issues shows its importance to China’s economic and strategic development, Zhang said by phone.

“They will definitely take a more assertive approach to territorial disputes but on the other hand, they also want to find a way to minimize the disruptive impact on China’s overall relationship with other countries,” he said.

The South China Sea holds undiscovered natural gas and is an important sea lane for imports of oil from the Persian Gulf that pass through the Strait of Malacca. China bought more than 50 percent of its oil from the Middle East last year, customs data show.

China will follow the principle of putting aside disputes and engaging in joint exploration on the precondition that “sovereignty belongs to China,” Xi said at the session, using a phrase uttered by former leader Deng Xiaoping in the 1980s, according to Xinhua. China will also pursue “converging interests” with other countries in oceanic development, Xi said.

Oil Reserves

Vietnam and the Philippines have rejected China’s maritime claims as a basis for joint development of oil and gas reserves in areas south of the Gulf of Tonkin. In May, Vietnam demanded compensation after a Chinese ship rammed a fishing boat off its coast.

China’s 235,000-man navy may compare to the U.S. and Russia in terms of the number of people and ships, yet there is a gap of a generation or even several generations in terms of weaponry and practical experience, Yang Yi, a rear admiral who has served in the navy for more than 40 years, wrote in the state-owned Global Times newspaper today.

Conflicting Claims

China dismisses rival claims to the Spratly Islands from Taiwan, Vietnam, Malaysia, the Philippines and Brunei. Further north, Japan’s purchase last year of some of the Senkaku islands, known as Diaoyu in China, led to Chinese protests and roiled trade ties between Asia’s two biggest economies.

China has agreed to meet in September with the 10-member Association of Southeast Asian Nations to develop rules aimed at avoiding conflict in the South China Sea.

Japan’s security environment is becoming more severe, the country’s Defense Ministry said in a midterm progress report July 26, citing China’s “insufficiently transparent” military expansion and the increase in its naval activities as one of the reasons. Japan should bolster its fledging marine force and consider developing a first-strike capability, the report said.

China will boost defense spending 10.7 percent this year to 740.6 billion yuan ($121 billion), the Ministry of Finance said in March. China has the second-biggest military budget in the world after the U.S., which spent nearly six times more on defense than China last year.

Even though China’s gross domestic product might surpass that of the U.S. in the next 10 or so years, China should not get into an arms race with the U.S. Navy, Yang said. China should reach one third the strength of the U.S. naval force, surpass Japan’s maritime defense force and come close to that of Russia, he said.

To contact Bloomberg News staff for this story: Henry Sanderson in Beijing at hsanderson@bloomberg.net

To contact the editor responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net

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