The South China Sea is a global commons, vital to the continued growth of global commerce, with a significant proportion of the world’s maritime trade passing through its waters, as well as much of the world’s oil and gas being transported through the region. From a Hong Kong perspective, the South China Sea is vital to the economic interests of the city and its people. The waters of the South China Sea are critical to the city’s status as a major financial centre, with a huge proportion of shipping, logistics, trade finance and other services passing through the city. If the South China Sea were to become a volatile or even a conflict zone, it would pose a structural threat to trade and to Hong Kong’s status as a global financial centre.

The South China Sea has immense commercial value, yet the region remains unstable, thereby becoming a conflict zone. This is a structural problem. It is well known that trade nowadays depends on predictability; that open sea lanes must be maintained; and that there must be some sense of the risks involved in trade. However, in the South China Sea, there are competing territorial claims, and on a regular basis, there are naval patrols as well as air force patrols. Also, as already noted, “grey-zone” actions are being conducted across the spectrum of conflict, so as to make it difficult for anyone to determine where normal operations end and coercive actions begin. Vessels are shadowed. They are confronted. They are monitored. It is not a safe space for commerce, and this, in turn, creates a lot of problems for companies that are involved in the shipping of goods through the South China Sea, as well as for the various........

© Eurasia Review