Question

What is the importance of SCS in terms of international trade?

What do you think about US military presence in the SCS region?

Some people believe that COVID-19 is starting a new era in international relations and business. US global leadership role will go down, while China's up. What do you guys think

Answer 1

The SCS, a rich fishing ground, is believed to harbor extensive oil, natural gas, and hydrocarbons assets and is a critical trade route through which about half of all world trade passes.

The United Nations Conference on Trade and Development (UNCTAD) estimates that roughly 80 percent of global trade by volume and 70 percent by value is transported by sea. Of that volume, 60 percent of maritime trade passes through Asia, with the South China Sea carrying an estimated one-third of global shipping. Its waters are particularly critical for China, Taiwan, Japan, and South Korea, all of which rely on the Strait of Malacca, which connects the South China Sea and, by extension, the Pacific Ocean with the Indian Ocean. As the second-largest economy in the world with over 60 percent of its trade-in value traveling by sea, China’s economic security is closely tied to the South China Sea.

Tensions between China and both the Philippines and Vietnam have recently cooled, even as China increased its military activity in the South China Sea by conducting a series of naval maneuvers and exercises in March and April 2018. Meanwhile, China continues to construct military and industrial outposts on artificial islands it has built-in disputed waters.

The United States has also stepped up its military activity and naval presence in the region in recent years, including freedom of navigation operations (FONOPs) in January and March 2018. In a speech during his November 2017 visit to Southeast Asia, President Donald J. Trump emphasized the importance of such operations, and of ensuring free and open access to the South China Sea. Since May 2017, the United States has conducted six FONOPs in the region.

The impact of the coronavirus is having a profound and serious impact on the global economy and has sent policymakers looking for ways to respond. China’s experience so far shows that the right policies make a difference in fighting the disease and mitigating its impact—but some of these policies come with difficult economic tradeoffs.

According to the situation, COVID-19 will also accelerate the shift in power and influence from West to East. South Korea and Singapore have responded best, and China has reacted well after its early mistakes. The response in Europe and America has been slow and haphazard by comparison, further tarnishing the aura of the Western “brand.”