(Corrects officer’s title and middle name in first paragraph of story published May 14.)
May 14 (Bloomberg) -- From his Vietnamese Coast Guard boat at night, Lt. Colonel Phan Duy Cuong can see the yellow lights of an oil rig 10 nautical miles away. Owned by a Chinese company, it sits in waters near islands claimed by both nations in the South China Sea.
Dozens of ships clutter the area, playing a daily game of cat and mouse in rough seas as China shields the rig with its vessels. At stake is the resource-rich waters around the contested Paracel Islands, in a dispute that has soured ties between the two Communist nations as China steps up its territorial assertions in the region.
An officer on Coast Guard vessel No. 8003, Cuong said his boat motored to 6.5 nautical miles from the rig today before being flanked and chased off by two Chinese coast guard ships that came as close as 400 meters (1,312 feet), blasting horns and playing recordings stating China’s sovereignty over the area. Four times the Chinese boats cut in front of the Vietnamese ship, he said.
Cuong said his vessel, which has been at sea since May 5 with 50 crew, got to 6 nautical miles yesterday from the rig before being forced back, and he saw a Vietnamese ship rammed. Crew members in the cabin relayed the boat’s position to superiors onshore as they pulled back.
“We have to defend the nation’s sovereignty and our people,” Cuong said. “Since we have been at sea, tensions have not eased. We’ll stay here until the Chinese side takes away the oil rig. Our purpose is to chase them away from Vietnam’s exclusive economic zone.”
The dispute risks damaging ties with Vietnam’s major trading partner that have deepened since relations were normalized in 1991, with Vietnamese protesting in major cities. It could bring Vietnam closer to the U.S. as a strategic and military buffer against China, and lead it to seek support from the Philippines and Japan, two countries embroiled in their own territorial disputes with China.
Cuong said the closest his boat has been to the rig is 3 nautical miles, on May 6. In the past few days the tactics of the Chinese vessels have changed to protect the perimeter around the rig, he said.
“The Chinese side are preventing us from entering the oil rig area from further away,” he said. “Before, we got close to 10 nautical miles and there were no Chinese ships accompanying us, but now between 8 to 10 nautical miles they are there to follow us.”
Anti-China sentiment is running high in Vietnam, said Le Hong Hiep, a lecturer at Vietnam National University in Ho Chi Minh City, with angry comments on social media and protesters damaging factories operated by Chinese as well as Taiwanese companies, leading the companies to temporarily shut operations.
Vietnam has “violated China’s sovereignty” by its actions in the area, Chinese Foreign Ministry spokeswoman Hua Chunying told reporters today in Beijing. Vietnamese vessels have rammed into Chinese vessels 169 times in one day, she said.
“China and Vietnam are having the necessary communication and China urges Vietnam to calm down,” Hua said. “The violent disruptions and ramming by a large number of Vietnamese vessels are why the situation has become tense.”
Vietnam’s immediate options are limited given China’s economic and military clout, according to analysts, and it may have to wait for China to complete the exploration work and remove the rig in order to avoid outright conflict. The two nations fought a war after China invaded Vietnam in 1979.
The latest escalation reflects an “unprecedented use of Chinese economic and military power to advance its sovereignty plans,” said Carlyle Thayer, an emeritus professor at the Australian Defence Force Academy in Canberra. “It will now unilaterally assert its prerogatives. It’s a constant source of tension that could lead to a major accident or outburst of firing.”
The confrontation is the biggest between the two nations since 2007, when Chinese naval patrol vessels fired on a Vietnamese fishing boat, killing one sailor. In 1988, a Chinese naval attack in the Spratly Islands, which Vietnam also lays claims to, killed 64 Vietnamese border guards as China seized seven atolls. China took the Paracel Islands from Vietnam by force in 1974.
President Xi Jinping is expanding China’s naval reach to back its claim to huge swaths of the South China Sea that is based on the “nine-dash line” map, first published in 1947, that extends hundreds of miles south from China’s Hainan Island to the equatorial waters off the coast of Borneo.
Vietnam’s Coast Guard said May 7 that Chinese vessels had collided with its boats, fired water cannons and used low-flying aircraft. The Thanh Nien newspaper reported yesterday that China now has 86 vessels near the oil rig, including a submarine and a missile ship.
“To the extent that the Philippines is facing the same problem, and to a lesser extent that Japan is facing the same problem, I think on a strategic basis each of these countries would have determined that the best play would be for each one of them to make some noise,” said Vishnu Varathan, a senior economist in Singapore at Mizuho Bank Ltd. “Then it makes for a louder sound against a very large competitor.”
China’s Foreign Minister Wang Yi spoke with his Indonesian counterpart Marty Natalegawa by phone today and Indonesia is willing to work with all parties for peaceful resolution of the disputes, Foreign Ministry spokeswoman Hua said. China also proposed cooperation with Taiwan over the South China Sea issue, the official Xinhua News Agency reported.
Vietnam could turn to the U.S. for help in beefing up its Coast Guard, Thayer said, and the U.S. could share satellite data with Vietnam on sea movements by China. Secretary of State John Kerry visited Hanoi in December and said the U.S. would provide five fast patrol vessels in 2014 to the Coast Guard.
“Vietnam can try to appeal to the sense of magnanimity of the Communist Party of China, while at the same time seek help from Russia,” said Termsak Chalermpalanupap, a research fellow at the Institute of Southeast Asian Studies in Singapore. “There are supposed to be fraternal party-to-party ties. This will alienate Vietnamese people from China further. Vietnamese people already don’t like made-in-China products.”
Two-way trade between the two countries rose 22 percent in 2013 to $50.2 billion, according to Vietnamese government data. Vietnamese exports to China rose 7 percent and made up 10 percent of all its exports, while China’s exports to Vietnam jumped 28.4 percent.
Bilateral trade between the two countries is expected to reach $60 billion in 2015, according to the Vietnam government.
Frictions between the two countries could stall broader cooperation including investment, without being a “show stopper” for trade, said Mizuho’s Varathan. “There is a certain degree of interdependence.”
Vietnam and China last June set up a hot-line between their leaders, and expanded a 2006 agreement to jointly explore for oil in the Gulf of Tonkin. Premier Li Keqiang visited Vietnam in October, where he and Prime Minister Nguyen Tan Dung pledged to boost “political trust,” signing a memorandum of understanding for a cross-border economic cooperation zone and agreeing to open trade promotion offices.
“This is why Vietnamese officials were caught by surprise by this,” Hiep from the Vietnam National University said by phone. “I’m not sure why China decided to take this action now. It’s an indication the two countries are drifting apart.”
The public complaints by Vietnam, including Premier Dung, show the party-to-party relationship behind closed doors is not working, according to David Koh, an independent consultant and former senior fellow at ISEAS who has studied Vietnam for more than 20 years.
“It’s not inconceivable, definitely, that there could be a very strong military relationship between Vietnam and the Americans in, say, maybe 10 years from now,” Koh said. “China could be more an unfriendly giant than a friendly neighbor.”
“The more the Chinese are trying to push the Vietnamese, the more the Vietnamese will be crossing the line to the American side,” Koh said.
Out on the Vietnamese vessel, Cuong said the spirit of the crew is “very strong.”
“Not anybody can be chosen for this duty so we are very proud,” he said. “We are not fearful.”
To contact Bloomberg News staff for this story: K. Oanh Ha in Hanoi at firstname.lastname@example.org
To contact the editors responsible for this story: Rosalind Mathieson at email@example.com