'Economy first' model may ease South China Sea tensions

His plan would leave the sovereignty issue for future generations, while turning the focus on potential economic and commercial benefits which could be derived from jointly developing the overlapping territorial areas.

Thailand might consider playing host to a conference of all claimant countries, since it is not one of them. It might also propose the 25-year-old Thai-Malaysian Joint Development Area (JDA) agreement as a model for sharing natural resources in overlapping areas.

In 1979, the Thai and Malaysian governments jointly agreed to explore and extract non-living natural resources from the area for mutual and equal benefits of both countries.

Today, the overlapping areas are managed by the Malaysia-Thailand Joint Authority for petroleum exploration and production, under the Joint Authority Act of 1990.

The law empowers the Joint Authority to grant rights, subject to respective government approval, for petroleum activities in the form of production-sharing contracts, while coordinating with relevant government agencies in both countries and collecting royalty and other benefits derived from the operations.

The Thai-Malaysian JDA’s overlapping areas total 7,250 square kilometres in the lower part of the Gulf of Thailand. In fact, these areas are close to the South China Sea where China, Malaysia, the Philippines, Vietnam, Taiwan and Brunei are currently in conflict over the sovereignty of the Spratly and other nearby islands.

Another example for consideration by claimant countries in the South China Sea conflict is the more recent Myanmar-Bangladesh JDA.

These two approaches are peaceful and non-confrontational.

While an argument in favour of the approach that gives the first priority to economic and commercial interests has been around for some time, geo-political interests remain a major obstacle to such a path. 

Given that the disputed areas are crucial to global shipping and commerce, as well as military interests, powerful nations outside the region, especially the US, have been vocal against China’s reclamation of the islands in disputed areas.

The US has been particularly supportive of the Philippines with which it has a bilateral defence treaty, as well as other claimant countries in countering China’s move to reclaim parts of the disputed area and build its facilities.

All these developments, however, do not bode well for the smaller countries concerned.

According to Surakiart, all claimant countries should be patient and resort to the law of the sea to settle their differences. The possibility of a five- or six-country partnership to jointly develop the disputed areas for commercial, tourism and other benefits should be explored.

In this context, there would be less patriotic emotions involved in the process, making it more likely for claimant countries to reach an agreement to share or lease the resources and related assets.

Thailand was asked to get involved as an intermediary between China and other Asean countries with territorial claims in the South China Sea a few years ago, at the time when it was assigned the co-ordinator of Asean-China relations.

By proposing an “economic first” model to approach the conflict for better relations among the countries concerned, Thailand stands to gain from its renewed role as an Asean leader.