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Five and a half years on from the international arbitral tribunal’s rejection of China’s expansive South China Sea claims in July 2016, the international maritime order in East Asia clearly is in trouble. China is continuing to consolidate its control over the Paracel Islands and most of the Spratleys group and is increasing its encroachments on the recognised exclusive economic zones of most of the South China Sea’s littoral states with relative impunity. The Philippines and Vietnam in particular have suffered numerous Chinese incursions, and Indonesia’s Natuna Islands and more recently Malaysia’s EEZ have been targeted in China’s bid to control the southern waters of the first island chain.

The region’s maritime order under the United Nations Convention on the Law of the Sea is central to the rules-based order that Australia, India, Japan, the US and other likeminded states hold to be central to regional security and prosperity. Yet China’s grey-zone tactics are continuing apace, weakening the authority and relevance of UNCLOS in the absence of a coordinated and unified regional stance supporting its rules and authority both in principle and in practice.

The wider regional implications of China continuing to unilaterally impose its own maritime laws on other states, denying them fishing and other maritime rights, provide compelling reasons for the Quad states, and others, to work harder to ensure that the rights and entitlements of all South China Sea littoral states under UNCLOS are protected. The threats include not only the further erosion of the rules-based order’s authority and legitimacy, perhaps to an irreparable degree, but also a major increase in Beijing’s political and economic leverage over the many Southeast Asian states that continue to depend on the fishing, energy and other sovereign rights China seeks to control.

Allowing Beijing to further expand its already significant presence and influence in the South China Sea would make it much more difficult for Australia, Japan and the US to build regional diplomatic support against China’s actions in the South China Sea and elsewhere, making great-power military conflict in the region more likely.

ASEAN’s role in the disputes remains hamstrung by internal divisions over its responsibility as a regional institution for protecting individual state maritime rights, despite its various statements affirming UNCLOS as the basis for resolving maritime entitlement disputes. Many in ASEAN are fearful of the consequences of being forced to choose between the US and China, of ASEAN becoming marginalised by great-power politics in its own backyard, and of the region becoming more militarised and conflict prone.

The lack of a unified ASEAN stance and response on China’s claims is also explained by fence-sitting among member states that are not directly affected by the South China Sea disputes or whose political and business elites prioritise the benefits of not antagonising Beijing. The fact that rival maritime claimants in ASEAN hold conflicting interpretations of UNCLOS’s provisions has been an additional obstacle to developing a common ASEAN position.

But signs of greater willingness to cooperate on maritime law enforcement and other maritime issues, encouraged by Beijing’s aggressive behaviour, are beginning to appear among the littoral ASEAN states. An agreement between Indonesia and the Philippines on their overlapping EEZs in the Celebes Sea was ratified by both governments in 2014. Vietnam and Malaysia are planning to sign a memorandum of understanding on maritime security cooperation addressing several problem areas, including illegal Vietnamese fishing in Malaysian waters. Vietnam and Indonesia, meanwhile, are continuing negotiations to establish provisional boundaries in overlapping areas of their claimed EEZs in the North Natuna Sea; in December last year the two nations signed a memorandum pledging improved cooperation on maritime security and safety.

These bilateral agreements should be read as both an assertion of the parties’ maritime rights and a clear rejection of China’s illegal ‘nine-dash line’ claims.

Beijing’s deployment of militia vessels for maritime fishing exposes them to suspicion of illegal fishing and thus also to legitimate maritime law enforcement action under UNCLOS. The longstanding problem of Illegal, unreported and unregulated fishing in the South China Sea therefore may present an important opportunity for the South China Sea states most at threat from China’s illegal maritime claims—the Philippines, Vietnam, Malaysia and Indonesia—to collectively develop, with greater capacity-building and regulatory support from the Quad states, a UNCLOS based, non-military means of pushing back against China’s claims and grey-zone tactics.

Doing so will ensure that regional, rather than external, actors take the lead in upholding and affirming maritime rights. It will also provide a broad and unambiguous affirmation of UNCLOS’s authority and relevance and place the onus for any military escalation on China by imposing grey-zone dilemmas on China’s leadership, especially in terms of its own conflict threshold calculations.

Aside from the geostrategic threat that a Chinese takeover of the South China Sea poses, the alternative to cooperative EEZ regulation and better maritime law enforcement is a Chinese-controlled South China Sea. That would extinguish the resource and freedom-of-navigation rights of all other states and make any plans for cooperative or multilateral management (such as through a regional fisheries management organisation) of those resources and rights redundant. The risk of a catastrophic collapse of the region’s biggest fisheries resource due to Chinese mismanagement, intensifying competition and conflict, or both, would significantly increase. Such an outcome would very likely mean more illegal fishing in Southeast Asia’s already depleted waters, and in the EEZs of other states, including Australia and Japan.

By collectively supporting the Philippines, Malaysia, Vietnam and Indonesia in their efforts to more effectively regulate and police fishing and other maritime activities, the Quad states can indirectly push back on China’s grey-zone encroachments while also helping the coastal states to better manage a longstanding threat to the region’s socioeconomic security and future prosperity.

Foreign Minister Marise Payne and Defence Minister Peter Dutton’s flight path on the way to Washington for the annual AUSMIN meeting with their American counterparts provides an insight into Australia’s policy directions and relationships as we look to open up to the world over 2022.

Their trip took them to Jakarta, New Delhi and Seoul, but interestingly flew through Vietnamese, Filipino and other Southeast Asian airspace, avoiding Chinese airspace by taking a long way around that can only have been deliberate.

A side leg to Tokyo and a fuel stop in Singapore were all that were missing to signal core trusted partnerships for Australia in the region in the twin eras of a prolonged Covid-19 pandemic and aggressive Chinese power.

As they arrive in Washington, what should we want out of the peak Australia–US ministerial forum? There’s a shopping list of activities that will demonstrate an urgent, shared and positive agenda for this 70-year-young alliance. An enhanced US military presence in Australia, expanded Australian naval facilities for US and other Quad and regional partner cooperation, a quantum tech partnership, joint missile production and space are all on the menu.

But, beyond any particular item on that list, what we—and the wider world—need out of the Australia–US relationship is ambition and initiative, and not just from America.

Investing intellect and resources in our future shared wellbeing, prosperity and security with trusted partners is the path Australia must take into 2022. This is the core outcome we want from AUSMIN and the Quad leaders’ meeting that Prime Minister Scott Morrison is having next week with US President Joe Biden, Indian PM Narendra Modi and Japanese PM Yoshihide Suga.

One purpose of both AUSMIN and the Quad meeting is a thread that connects Canberra, New Delhi, Jakarta, Seoul and Tokyo, as well as European partners who are increasingly recognising the Indo-Pacific as a place that combines their economic and security interests. That’s to chip away at the empty notion that the issue of our times is making—or avoiding—a choice between the US and China.

The uncomfortable realisation is growing that there is no choice, and that the real challenge from China is not one for the US alone but should concern every open society and indeed any other sovereign state that doesn’t wish to have its choices dictated and constrained by the regime governing China.

But the broader combinations of European and Indo-Pacific states need momentum, which can come from the actions of tighter groupings and partnerships. Our US ally is essential here, both for its scale and capacity but also because it too is seized of the need to create momentum through action and investment. And Australia, as an activist nation, is probably best placed to work with the US at speed and to set directions through our own policy thinking and creativity.

Like the American public, Biden is clearly tired of the US needing to be the source of every agenda and is likely to welcome Australia as a provider of analysis, ideas and proposals (as occurred with 5G) around which the alliance and his emerging foreign, security and economic policies can build.

There’s good news here, if our political leadership understands the opportunity we have and the path we can take to achieve it.

The arc of Australian security and economic policy is to make China matter less and to deepen our engagement with partners we can trust, in a world where shocks and disruption from the natural world and from Chinese state power are likely to continue and accelerate. It’s not about changing Chinese government fundamentals, but about recognising them and what they mean.

In direct security terms, Payne and Dutton can use our growing defence budget to invest in enhanced naval facilities in Australia’s north and west and use them as key enablers for ourselves and for US, Indian, Japanese and other partners’ maritime operations through the Indian Ocean and up into Southeast Asia and the wider Pacific.

This investment will grow Quad cooperation faster than potential adversaries expect and so help deter conflict in our region. It’s likely to unlock co-investment from the US and, in coming years, from other security partners seeking to make a more visible contribution to Indo-Pacific security. France and the UK come to mind.

And beyond physical facilities for our own military and cooperation with others, Payne and Dutton might propose cooperation on the national security elements of quantum technologies and on co-production of advanced missiles in Australia to supply both the Australian Defence Force and US forces in the region.

Both of these areas will require Australian investment along with deep government-to-government agreement if we are to achieve any tangible outcomes for our security in anything like the near term. But both are essential for Australia to be able to operate and succeed in future conflict, and therefore to deter such conflict. For example, making concrete progress beyond technology demonstrators in the area of uncrewed undersea systems and seeing space as a truly transformational area for the alliance and security would be fantastic.

That type of ambitious agenda at AUSMIN will set the scene for a wider program at the Quad leaders’ meeting next week. Far from stealing the thunder of that meeting, it will allow Morrison to use the momentum from the more focused national security forum to Australian advantage at the Quad. And there, he must build on the directions that the first ever (though virtual) Quad leaders’ meeting established in March.

Then, the Quad leaders announced joint work to speed up the production and distribution of Covid-19 vaccines to partners in the Indo-Pacific, notably Southeast Asian and South Pacific populations, in the knowledge that no one part of the globe will truly be able to deal with Covid until the wider world has access to population-level vaccination.

The effort bogged down as India experienced a surge of infections, but now the leaders can anticipate growing vaccine production and availability out of both the US and India over the coming 12 months.

Now is the time to plan for these vaccines to be distributed rapidly and widely in small Pacific states and in the populous nations of Southeast Asia. We know from Australia’s domestic vaccine rollout that time spent planning distribution with our South Pacific and Southeast Asian partners will be time well spent.

Australia must spend the money required to establish an onshore production capacity for mRNA vaccines to complement our AstraZeneca production. As Bill Gates has observed, Covid-19 won’t be the last disease to cause havoc in our world, and new variants are likely to emerge. This fact alone makes a national vaccine production capacity, with scale to help our near region, both a smart and an essential investment.

For the doubters and economic rationalists, it’s worth remembering that South Pacific economies like Fiji and Vanuatu depend on Australian and New Zealand tourist spending. If we want to avoid these island states requiring large structural economic assistance programs from international lenders and donors—like Australia—then helping them reopen to us as we reopen to the world makes simple financial sense (as well as being the right thing to do).

A vaccine production capability would be fed by Australia’s hugely capable medical and biotechnology research outfits, and so be much more than an assembly line for others’ vaccines.

The last area of Australia–US and Australia–Quad cooperation that Morrison might use his time in America to supercharge builds out of this sector.

Biotechnology is what brought the world the Pfizer and Moderna vaccines in record time. Applied to agriculture, for example, it’s also what will create climate-change-resistant crops to feed Australia, our region and the rest of the world as the impacts of climate change grow.

Australia has an enormous opportunity to build on our history of agricultural research partnerships with ASEAN economies. We can use the power of the Quad to accelerate agritech research to address the food-security pressures we know are coming our region’s way, and do so ahead of time to drive the wellbeing, prosperity and security of our near region and our own people.

Ambition and initiative backed by investment. Commodities that are rare but of increasing value as we look to 2022.

‘Global strategic focus has shifted to the Indo-Pacific. How the region handles the next few years will determine if it becomes the cradle of crises or solutions.’

— Cleo Paskal, Indo-Pacific strategies, perceptions and partnerships, Chatham House, March 2021

Editors often conjure a good yarn on a big issue by dispatching journalists out to different places to ask the same question.

The contrasts and rhymes of diverse pubs, parishes and peoples do the alchemy, pulling the story together. Travel the miles and spend the time. Repeating a good question all over the place can turn up gold. It works as well for an academic research paper as a TV documentary.

Chatham House has just done this with a question for our times: the meaning and purposes of the Indo-Pacific. You’ll not be surprised that China looms large in the answer.

Chatham House talked to 200 experts in seven countries: the US, the UK, France, India, Tonga, Japan and China, recounted in Indo-Pacific strategies, perceptions and partnerships, by Cleo Paskal. The story she tells is how six nations regard the seventh, China.

The six aren’t as one on what the ‘Indo-Pacific’ is (the French policy community, characteristically, wants the term more clearly defined, while their Indian counterparts see benefits in ambiguity), but the six know what the construct is about: ‘[A]ll agree, to some degree or another, that the primary driver of increasing interest in the Indo-Pacific is China’s growing economic and strategic expansion.’

Looking out to 2024, the survey found three major themes:

• Domestic division—A constant in the six was concern that their national policies were fracturing over China, along the economic–security divide: ‘This fracture was impeding decisive and focused decision-making.’
• An ‘extraordinary’ amount of uncertainty—In the words of one US participant, ‘[T]here are more balls in the air than at any time since World War II.’
• Hedging between the US and China—The aim is to keep options as open as possible, but ‘the general sentiment was that, by 2024, hedging would be coming to an end as both Beijing and Washington increased pressure’.

The shock of the pandemic and the cascading impacts of China have united polities. Domestic divisions have diminished, Paskal writes, with more willingness to push back:

The pandemic has had such a severe economic effect in all six countries that the cost of some sort of ’decoupling’ from China can appear relatively minor in comparison. It seems less of an issue to rock the economic boat if that boat is already sinking.

The power of China and the expanding construct of the Indo-Pacific demand a response from even small capitals like Nuku‘alofa. Tonga switched diplomatic recognition from Taiwan to China in 1998, has substantial loans from Beijing, and joined the Belt and Road Initiative.

Paskal describes Tonga as ‘a clear example of increased strategic interest in Oceania, with the UK reopening its diplomatic mission there, Japan stepping up military engagement, and the US offering the country a partnership with the Nevada National Guard’.

For Nuku‘alofa, the surge in interest provides ‘more options’, which is the classic South Pacific stance. International interest means more potential donors; the skill is to play with all suitors, never settling for one. The more the merrier—Tonga wants to add India to the mix—is the established formula to achieve a balance between ‘partnerships and independence’.

On the other side of the world, France is ‘one of the least divided and most certain countries’ because its economic, political and defence outlooks are ‘closely aligned’. The aim is to shape its own Indo-Pacific reality, ‘unabashedly built around pragmatic French interests’. Paris may not be able to engage as widely in the Indo-Pacific, but it’s ‘likely to engage more deeply’. President Emmanuel Macron’s vision of a ‘Paris–Delhi–Canberra axis’ reaches into the Quad while not being in the Quad.

UK foreign policy is ‘undergoing epochal change’ and a ‘fundamental reassessment’. London’s view of China has toughened over Hong Kong and Huawei. The UK’s integrated review promises to deepen ‘engagement in the Indo-Pacific, establishing a greater and more persistent presence than any other European country’. Weigh that ambition against this comment on interviews in London: ‘When foreign policy participants were asked if the UK was a great power, there was often an awkward pause, followed by a variation on “not really”.’

Japan has the opposite problem: it’s a big player with the polite mien of a middle power. Paskal reckons a loss of trust in China as a long-term investment could substantially shift Tokyo’s position. But she ends with the familiar problem of whether Japan will step up as a big power or merely decline and recline:

It is possible that Japan will increasingly line up with its allies and partners in a stronger, rounded stance against Beijing. However, it is also possible that domestic economic and political lobbies will successfully weaken any effective pushback on China. Much will depend on the direction taken by Washington, and how that affects Tokyo.

India’s tone ‘has shifted substantially’, with much less hesitation in embracing the Quad. Paskal notes calls for an India–US ‘alliance’—though not the sort of alliance ‘recognized by lawyers’ but the sort ‘recognized by generals’. The June 2020 border conflict in the Himalayas saw popular opinion turn strongly against China:

A series of decisive actions took place, including banning Chinese apps on security grounds, restrictions on foreign direct investment, restrictions on visas for certain Chinese people, and a shift to a more forceful military strategy.

For India, as with everyone else, hedging behaviour is turning prickly, because the hedging space is contracting. ‘Countries are being forced to pick a side,’ Paskal writes, predicting ‘a new era of alliances and partnerships’.

The conclusion is a call for an Indo-Pacific charter, expressing a consensus on acceptable behaviour, rules and norms:

An Indo-Pacific Charter is one way to reduce domestic division, uncertainty and hedging by making clear internally and internationally what nations that sign stand for, in the same way as the Atlantic Charter did in 1941 … [T]he goal would be to create partnerships strong enough, and with enough levers (including economic), to dissuade nations that want to dominate unilaterally. That could mean economic boycotts or supply-chain redirecting, rather than naval blockades.

The effectiveness with which Russia and China have been able to exploit situations to make territorial gains has exposed a chronic vulnerability for collective defence regimes. Collective defence risks becoming unfit for an era of strategic competition in the grey zone.

The Quad implicitly acknowledges this and has developed as a collaborative defence arrangement that can respond to the sorts of threats China poses.

For the Quad to succeed in this way, Australia, India, Japan and the US will need to work together using force—or tactics that sit above or slightly below the threshold of armed conflict—to block Chinese attempts to seize territory. They’ll also need a coherent strategy to counter China’s other activities below the threshold of armed conflict.

This will require a broad understanding of defence using different elements of national power to counter a range of coercive threats. Each member will need to understand which levers should be pulled at what times in a coherent strategy that thwarts Beijing’s ability to achieve its political objectives at each stage of competition or conflict.

The more coercive the power China mobilises, the fewer levers of national power the Quad members would need to pull. In a hypothetical example in the first part of this series, I described how Quad members might develop an effective military response to a Chinese attempt to seize Pratas Island from Taiwan. In that case, the four members of the Quad would be pulling down heavily on the military levers of national power—albeit at different stages of the conflict and in different theatres.

Responding to the most coercive of China’s threats is the easiest part of the Quad’s job. It gets harder if China mobilises less coercive power when threatening the Quad’s interests in the Indo-Pacific. This is where the distinction between collective defence and collaborative defence becomes key.

Over time, China has reclaimed land and transformed islands into military facilities that have increased its ability to project power across the Western Pacific. This has raised the costs for the US to defend its treaty allies, which undermines its presence in Asia.

For Japan and Australia, China’s South China Sea facilities pose a threat to the freedom of navigation each relies on for trade.

In India, the stakes may not be as high, but any erosion of international norms in the South China Sea would set an unwelcome precedent as the Chinese military increases its presence in the Indian Ocean. So far, the differing stakes for each country in the Quad have made a collective response impossible.

However, an effective response to China’s grey-zone coercion need not be ‘collective’. In 2017, Ely Ratner, Biden’s top China adviser at the Pentagon, argued in Foreign Affairs that the US should  ‘abandon its neutrality and help countries in the region defend their claims’.

Ratner suggested that the US help treaty allies such as the Philippines with joint land-reclamation projects, increased arms sales and improved basing access. Other Quad members would also need to draw upon their own bilateral partnerships to help claimant states build resilience to Beijing’s grey-zone operations. The Quad would be a subtle means of helping Southeast Asian claimants defend their sovereignty against China’s creeping expansionism.

Ratner’s proposal shows collaborative defence in action with the aid of the Indo-Pacific’s established great power. While Washington is laying the groundwork to compete with China in the grey zone, Australia could strengthen its maritime capacity-building initiatives and joint naval exercises with Malaysia and Indonesia in archipelagic Southeast Asia.

India and Japan could each increase the frequency of their bilateral naval exercises with Vietnam. The Quad could agree to conduct Exercise Malabar in the South China Sea, while members of the ‘blue dot network’ could jointly finance critical infrastructure projects in littoral states. An effective strategy would require each Quad member to use a mix of diplomacy, aid, military exchanges, arms sales, joint exercises and new basing infrastructure.

None of these initiatives will achieve results immediately, but nor did China’s island-building campaign. Over time, each initiative will shift the burden of escalation back to China. With each Quad member working independently and collaboratively to embolden claimant states to defend their maritime rights, Beijing will incur new risks when rotating new fighters on Fiery Cross Reef or contemplating further incursions into the Natuna Islands.

Collaboration will allow each Quad member to find out how best to draw on its bilateral partnerships to embolden claimant states to defend their interests. The Quad will be invisible, but omnipresent in Southeast Asia. That’s precisely the threat that Beijing doesn’t want to deal with.

To succeed as a collaborative defence arrangement, the Quad needs to be guided by three principles. Its members need to work independently on their bilateral relationships to improve claimant states’ ability to defend their interests; they must exercise together whenever strategic circumstances require it; and they need to share notes on regional strategy, knowing it will be much harder for China to secure further territorial gains if it’s on the back foot.

Adhering to these principles will enable the Quad to realise its potential as a collaborative defence arrangement that can counter China’s grey-zone operations.