Sanctions vs Chinese firms used for coercion in SCS not off the table – US

“Nothing is off the table,” United States Assistant Secretary of State for the Bureau of East Asian and Pacific Affairs, David R. Stilwell said when asked about the possibility of sanctions against state-owned enterprises used by China “as tools of economic coercion and international abuse.”

“In the South China Sea, as elsewhere, Beijing has used state-owned enterprises as tools of economic coercion and international abuse,” Stilwell said during the virtual Center for Strategic and International Studies (CSIS) 10th South China Sea Conference on July 14.

“They have been used to dredge, construct, and militarize the PRC’s (People’s Republic of China) artificial island fortresses in the Spratlys, from which Beijing now violates the exclusive economic zones of Southeast Asian states,” the US assistant secretary of state said.

He gave China Construction & Communications Corporation (CCCC) as an example. He said CCCC led the dredging for Beijing’s South China Sea military bases, with terribly destructive effects on the marine environment and regional stability.

“State-owned enterprises have been used as battering rams to attempt to enforce Beijing’s unlawful “Nine Dashed Line.” China National Offshore Oil Corporation, or CNOOC, used its mammoth survey rig HD-981 to try intimidating Vietnam off the Paracel islands in 2014. It is telling that CNOOC’s chief executive touted that oil rig as “mobile national territory.” The implications of such a statement should give pause to every nation that relies on the freedom of the seas for prosperity and security,” Stilwell added.

He added that other PRC commercial survey ships and rigs have been sent repeatedly into Southeast Asian waters in which China has no rights. 

“Numerous PRC state-owned tourism, telecom, fisheries and banking firms invest in ways to enable Beijing’s unlawful claims and bullying. PRC fishing fleets in the South China Sea often operate as maritime militia under the direction of  China’s military, harassing and intimidating others as a tool of violent state coercion,” he said.

“These state-owned enterprises are PRC instruments of abuse, and we should highlight their improper behavior,” he added.