POTENTIAL FOR CONFLICT OVER CERTAIN DISPUTED ISLANDS IN THE EAST AND SOUTH CHINA SEA

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CIA-RDP85T00353R000100020002-2
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January 13, 2003
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2
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February 5, 1974
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Approved For ReleH~32$3 - R000100020002-2 CENTRAL INTELLIGENCE AGENCY Feb:ruary 5, 1974 OCI No. 1108/74 SUBJECT: Potential for Conflict Over Certain Disputed Islands in the East and South China Sea Key Judgments The recent clash between Peking and Saigon over possession of the Paracel Islands raises the possi- bility of further fighting there and over other dis- puted islands in the East and South China Sea--the Senkaku Islands, Pratas Reef, and the Spratly Islands.* Claims, capabilities and other factors vary in each case, but certain common denominators affect all the disputes: Peking has claimed all the islands, and all may have untapped oil reserves. --The principal problem revolves around Peking's intentions. None of the other parties to the disputes seems prepared to undertake military action. --Despite Peking's aggressive actions in the Para- cels, the evidence elsewhere thus far available does not suggest a significant shift toward a more aggressive Chinese posture. --Peking would have far more to lose than to gain by initiating hostilities in the Senkakus or at Pra.tas Reef. Action in either place is highly unlikely. --China is in firm possession of the Paracels. Its position there is not likely to be seri- ously challenged. --Peking will view the recent South Vietnamese actions in the Spratlys as a direct challenge. The tit-for-tat exchange of statements by Peking and Saigon on the Spratlys obviously raises the danger of a confrontation. Even so, a military initiative there by Pek politically difficult and militari odds are that Peking will avoid a *Map at overleaf Apra ed For Release 2003/02/27: CIA-RDP85T00353R00 25X1 25X1 MACAO (Port.) HONG KONG (U.K.) PRATAS ISLAND. Paracel Islands Amphitrite Group Pattie\ Lincoln a Nang Crescent Group Woody Geld e SOUTH CHINA SEA Northeast Coy.. Thitul. __West York Pratas Reef Loaite Ito Ahk . Nanohan f ? Senkaku Islands PEOPLES REPUBLIC OF CHINA R PUB OF CHIN TAIWAN) Spratly Islands ~Saadcd \ PALAWAN Soratly sin Cowd / . j ' INDONESIA', ,..1 _t - 0 200 CELEBES es 1 -- Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Discussion 1. The recent clash between China and South Viet- nam for possession of the southern portion of the Paracel Island chain (the Crescent Group), together with South Vietnam's subsequent action in landing small forces on several of the Spratly Islands, raises the possibility that further clashes over disputed island territories in the East and South China Sea may occur. Four separate island or island groups are involved. Certain factors are common to all, but each presents slightly different problems involving claims, capa- bilities and presence. The four are, in order from north to south, the Senkaku or Tiaoyu Islands north of Taiwan, Pratas Reef or Tungsha Island eastsoutheast of Hong Kong, the Paracel or Hsisha Islands lying south of Hainan Island and east of Vietnam, and the Spratly Islands lying west of Palawan Island in the Philippines. The Nationalist and Communist Chinese are rival claimants in each of these cases; the Japanese are involved in the case of the Senkakus, the Philippines in the case of the Spratlys, and the South Vietnamese in the case of both the Paracels and Spratlys. Claims 2. None of the islands normally supports a perma- nent civilian population; all require a regular supply effort if they are occupied. Claims therefore rest almost exclusively on usage, which amount essentially to irregular visits by fishermen and guano collectors, on the establishment of boundary markers in some cases, and on records of exploration ranging from the third to the nineteenth centuries, some better documented than others. 3. The dispute over sovereignty in the Senkakus arose much later than in the other cases. Japanese inspection surveys commenced in 1885 and the islands were formally incorporated into the Japanese empire in January 1885, though the islands were not included in the territories ceded by imperial China to Japan in May 1895. They were administered from Okinawa during US occupation of the Ryukyus and were returned to Japan at the conclusion of the occupation. The expressed US view at that time was that Washington took no position on the validity of rival claims to the islands. Chinese claims, both Nationalist and Communist, were advanced following indications in 25X1 Approved For Releas I 0100020002-2 25X1 Approved For Release, 2003/02/tO 71 . %C1 - 00100020002-2 ECRET 1968 that oil deposits were present in the waters sur- rounding the islands. Claims and counterclaims became heated in 1970, 1971 and early 1972 as the time for reversion of the Ryukyus approached, but have since largely died away. 4. Pratas Reef is, in effect, another of the "off- shore islands-7.1 It is claimed only by the two rival Chinese governments, and neither side has publicly made an issue of possession in recent years. 5. Conflicting claims to the Paracels date back at least to the early years of this century. Chinese claims were advanced in the first decade of the cen- tury; decrees of the French, Bao Dai, Diem and Thieu governments have placed the islands under one or another Vietnamese province. The Japanese occupied the islands during the Second World War. At the signing of the Japanese peace treaty in 1951 both the colonial Vietna- mese government and the Nationalist Chinese claimed the islands. Peking advanced its own claim shortly there- after. The Chinese Communists have consistently paid far greater attention to these islands than to the other groups under consideration. They have reiterated their claim at irregular intervals since 1951; a large percentage of the "serious warnings" directed at Wash- ington by Peking in the late 1950s and 1960s involved allegations of intrusions by US ships or aircraft in the Hsisha area. As in the case of the Spratlys, neither the North Vietnamese nor the Viet Cong have laid formal claim to the Paracels, and they have not endorsed claims made by other countries. 6. The SS.ratly Island group presents the most complicated picture of all. South Vietnamese claims were advanced, for the first time seriously, at the time of the signing of the Japanese peace treaty. Nationalist China advanced its counterclaims at the same time. Communist Chinese claims were advanced at the same time claim was laid to the Paracels and to the Macclesfield Bank, which lies east of the Paracels. In the 1950s a private Philippine citizen claimed several of the islands, and in 1971 President Marcos stated that the Spratlys were, in effect, an inter- national trusteeship of the allied powers of the Second World War; this position was amplified by Marcos' implication that the Philippines, owing to proximity and the dictates of national security, were 25X1 25X1 Approved For Rele?j3/ - 000100020002-2 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 25X1 Presence 7. All the islands except perhaps Pratas Reef are visited from time to time by fishermen of various nation- alities. None has remained for any appreciable length of time. 8. None of the Senkaku Islands has been garrisoned since the end of the Second World War. Nationalist fishermen were briefly ensconced on several islands in the group in 1971, but departed without incident under Japanese pressure. The islands are patrolled regularly by the civilian Japanese Safety Agency. Occasional Nationalist Chinese patrols have also visited the group. The Nationalists have maintained a modest garrison on Pratas Island since 1955. These forces are supplied by.sea on a regular basis. An airstrip on the island makes an air link with Taiwan possible. 9. Until this month the Communist Chinese and the South Vietnamese tacitly divided the Paracels between them, with Peking maintaining a presence -in northern Amphitrite Group and the Vietnamese present in the southern Crescent Group. A Nationalist garrison de- parted Woody Island in the Amphitrites in the early 1950s; the Communists maintained garrisons on several of the Amphitrites since the mid-1950s, principally on Woody and Lincoln Islands. They have built communi- cations and radar facilities on both Woody and Lincoln and have established facilities capable of berthing small vessels in calm weather at Woody. Chinese ships have regularly patrolled the Amphitrite Group since the 1950s. Upon their departure from Vietnam the French turned over a weather station in Pattle Island in the Crescent Group to the South Vietnamese. This was the only permanent garrison maintained by Saigon on the islands before last month's fighting, although troops occasionally landed on other nearby islands in the Crescents. South Vietnamese gunboats patrolled 25X1 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 25X1 the Crescents on a fairly regular basis prior to the clash. In 1959 some Chinese fishermen from the main- land appeared briefly on one of the Crescent Islands and were "captured" by GVN forces. This was the only clash between Saigon and Peking prior to the middle of last month. The Chinese Communists are now in clear possession of all the islands in the Paracel archipelago, and they show every intention of remain- ing firmly entrenched there. 10. The Spratly Islands were generally uninhabited from the end of the Second World War until 1956, when the Nationalist Chinese established a garrison on Itu Aba, the largest island in the archipelago. Tomas Cloma, a private Philippine adventurer who claims the islands for himself, has apparently appeared on one or another of them from time to time. In July 1971 President Marcos dispatched a company of marines to occupy three of the islands, ostensibly in response to Taipei's long-standing presence on Itu Aba. More recently, Philippine marines were reported in occupa- tion of five islands in the group--Nanshan, Loaita, 25X6 West York, Thitu and Northeast Cay. Whether there are Philippine forces actually present on all these islands, however, is unclear. 11. The first permanent South Vietnamese presence in the Spratlys was established in the fall of 1973-- a 64-man Regional Force team on Namyit Island. Partly in reaction to its expulsion from the Paracels, Saigon on January 31 dispatched a small flotilla carrying more than 100 additional troops to garrison at least five more of the islands--Sand Cay, Sin Cowe, Spratly, Amboyna and Northeast Cay. These forces were instructed not to land if they found any of the islands occupied. Press reports out of Saigon claim the forces are now ashore, but there is no official word as to which islands are now held by Saigon; in particular, it is unclear who is in occupation of Northeast Cay. Com- munist China has no forces at present in the Spratlys and has not patrolled these islands. Capabilities 12. With the obvious and salient exception of the situation in the Paracel archipelago, none of the SECRET 25X1 Approved For Release 2003 R000100020002-2 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 SECRET 25X1 various parties involved in these disputes have re- cently made military moves in clear expectation of a new clash. Again with the exception of the Paracels, and possibly Pratas Reef, none is so situated that it can bring overwhelming force to bear in order to achieve a quick and easy victory at arms. The Sen- kakus are within easy steaming distance of Communist Chinese naval forces and within range of Chinese air- craft, both fighters and tactical bombers. If Peking were absolutely determined to occupy the islands, it probably could do so even in the face of intervention on the part of either the Japanese and the Nationalist Chinese, or both. In the event of this extremely unlikely contingency, however, Peking could be faced with a battle of considerable proportions, and securing of the islands might not be quick. In the equally unlikely event of a conflict between the Nationalist Chinese and the Japanese, the odds probably would favor Taipei as a result of geographical proximity and readiness and training of Nationalist forces. 13. The Nationalists seem determined to defend Pratas Reef in the event of an attack, but the would find the going difficult. 25X1 the island is within easy range ommunist naval and air forces, but approaching the extreme range of Nationalist air capabilities operat- ing from Taiwan. Nationalist planes could attempt to bomb mainland naval forces in the area but could not stay over the island. In these circumstances, a determined push would almost certainly secure the island for Peking. 14. Peking should have no difficulty in maintain- ing its hold on the Paracels. The islands are within range of both fighters and bombers stationed in southern Kwangtung province and on Hainan Island, and within steaming distance of naval forces stationed in the same places. In addition, the Chinese communists could refuel at least a few of its vessels in calm weather at Woody Island. Naval and air patrolling of the archipelago is being maintained by Peking. 15. In respect to military capabilities, as in other respects, the.Spratlys present the most proble- matic picture of any of the disputed areas. The islands are beyond the range of Chinese Communist 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 SECRET fighter cover and at the extreme range of tactical bombers staging from Hainan Island. Moreover, Peking would have difficulty in maintaining surface forces in action in the archipelago; the islands are a good deal further from naval bases on Hainan and the mainland than the Paracels. These difficulties are multiplied in the case of the Nationalist Chinese. The Spratlys are beyond the range of Taipei's aircraft, both fighters and bombers, and further still from Nationalist naval bases than from those of the Communists. Given these problems, Taipei is considering withdrawal of its garrison at Itu Aba in the face of a serious chal- lenge. The Philippines could probably bring air power most easily to bear in the islands, but its marine con- tingent in the Spratlys is little more than a token force which would be unable to defend against a serious military challenge by either South Vietnam or China. South Vietnam has available forces for further rein- forcement of its military toehold in the Spratlys, and its navy is adequate for resupply and rotation of such forces, but it would face problems similar to those of Peking in an actual battle. Air support would be feasible, but difficult; it is unlikely that aircraft could maintain patrols over the islands. Interests 16. The one factor in common in each of these disputes, except perhaps that over Pratas, is oil. Reserves beneath the East and South China Seas are still essentially unproven, but all parties seem to believe that considerable quantities are there. The petroleum factor figures most clearly in the case of the Senkakus. Neither Nationalist nor Communist Chi- nese claims to the group were seriously advanced before indications that oil was present in the waters surrounding the archipelago had surfaced, and it is unlikely that Tokyo would have been quite so concerned with those claims if oil reserves close to home had not been at stake. Peking's frequent reiteration of its claims in 1970-72, however, probably served an additional purpose: it was a means of indicating that Peking intends to play a major role in the eco- nomic as well as the diplomatic politics of East Asia. Moreover, Peking may have had it in mind that issues regarding claims to mineral resources off coastlines and island chains are certain to be discussed at the forthcoming Law of the conference. Thorny problems 25X1 Approved For Release 003/0 - 00100020002-2 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 involving the extent of such claims and of adjudication of conflicting claims have apparently been under fairly intensive research in Peking since at least 1970, and the Chinese may have thought it expedient to state its case with respect to the Senkakus, as it had to other, longer-established claims, well in advance of the conference. This factor may have played a small role in the formulation of Taipei's and Tokyo's positions on the Senkakus, but apart from the oil question their major concern probably is to forestall physical occupa- tion by Peking of islands, however small, that are in close proximity to both Taiwan and Okinawa. 17. Oil is probably at best a minor consideration for the two parties involved in the dispute over Pratas Reef. This small island is merely another of the un- solved problems growing out of the unfinished Chinese civil war. For both the Nationalists and the Communists the island is important, as are the other "offshore islands," primarily as a symbol that the long duel between the two parties is still not over. 18. Taipei's current interest in the Paracels is perhaps more theoretical than actual. The Nationalist government is concerned that its claim to sovereignty has not been seen to lapse. An assertion of Chinese sovereignty over territory also claimed by foreign governments is an important consideration for Taipei; for emotional and historical reasons, the Nationalist government cannot affort to appear so "unChinese" as to acquiesce in the absorption of such territory by a foreign power. Practically, however, Taipei can have no hope either of making good its claim or of exploit- ing any mineral resources in the waters around the islands. 19. Saigon, however, is probably much more prac- tically concerned with the oil question; witness its recent leasing of drilling concessions in coastal waters south of the Paracels. In addition, the South Vietna- mese probably view the islands as a potential base for monitoring North Vietnamese/Viet Cong sea infiltration activities. Conversely, Saigon almost certainly con- siders that the Paracels in the hands of a hostile power such as China could pose a threat to South Vietna- mese shipping and to its general security. 25X1 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 20. For Peking the issue may be the most compli- cated of all. The Chinese Communist concern for the assertion of sovereignty over islands "traditionally" Chinese parallels that of the Nationalists--its frequent reiteration of its claim to the islands coupled with its obvious sensitivity to alleged US intrusions into waters it claimed as its own suggests that this has been a real factor for China. Its interests in the oil issue parallels that of South Vietnam, and is probably an important element in the current situation. Peking's statement of January 11 partially laid claim to the mineral resources in the waters around the Paracels and other islands in the South China Sea. Its strategic interest in the islands, however, is somewhat different from that of Saigon. China obviously does not feel threatened by South Vietnam, and there is little reason to believe that at this time it is particularly interested in securing a base to facili- tate the movement of North Vietnamese men and supplies into the south. On the other hand, Chinese activity on Woody Island in the past several years strongly suggests that Peking plans over the long term to con- struct a forward operating base for its growing South Sea Fleet. This would be a logical development if Peking expects to continue to develop even a modest blue-water capability. Moreover, the Chinese have obviously been concerned over the growth of Soviet naval power in the Pacific and Indian Ocean. It is unlikely that they fear that Soviet activity would expand into the South China Sea any time soon, but they may believe it important to assert even a modest Chinese presence in these waters. At the same time, they may have in mind as a subsidiary consideration that by making good their claim to the Paracels they can convey a message to Hanoi that they rather than Moscow are the central factor to be reckoned with in and around Indochina. 21. Finally, questions involving Law of the Sea are present here as they are in the Senkakus. The Chinese claims to the Paracels, the Macclesfield Bank and the Spratlys, if made good, would effectively span the area between the Philippines and Indochina. Ocean passage would not be affected even under existing laws of the sea; the major sea lanes in the South China Sea run well off shore between the Paracels and Spratlys. 25X1 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Manila has obvious rights in the trench between Palawan and the Spratlys, and in any case Peking does not have a naval force capable of dominating this area. But through a combination of seabed mineral rights and anti- pollution regulations it might over time establish a strong legal position in waters in the area. 22. These legal concerns and strategic considera- tions vis-a-vis the Soviets probably touch to some degree on Peking's interest in the Spratlys as well as the Paracels, although in the case of the Spratlys China does not have an embryo naval base to protect. The oil factor is undoubtedly at work here also, as is the Chinese need to assert its traditional claims of sovereignty, operative, as in the case of the Para- cels, long before oil was suspected to exist beneath the surrounding waters. For Taipei the sovereignty issue is almost certainly paramount, although the Nationalists may entertain some faint hopes of drilling for oil close offshore Itu Aba in the Spratlys. For the South Vietnamese oil is probably a far more important consideration: this was almost certainly the motive that lead to Saigon's decree of last autumn that set in train the events resulting in last month's clash as well as to the concurrent garrisoning of Nam;rit Island. South Vietnam's additional landings in the Spratlys last week, however, clearly sprang from other motives: the need for a face-saving ploy following the defeat in the Paracels. Manila is also interested in possible exploitation of oil reserves in the waters off the Spratlys, but it also has a strong negative interest in the islands--that they do not become a potential staging area for hostile actions against the Philippines. Constraints 23. Running parallel to this medley of interests in the various island groups, however, as a series of rather strong constraints that tend to perpetuate the status quo. Given their close and important economic ties, neither Japan nor Nationalist China wishes to come to blows over the Senkakus, where neither could be absolutely certain of the outcome. Nor are Tokyo and Peking at all interested in a real confrontation over the islands. For Japan there is clearly nothing to be gained by incurring the enmity of China, which could well be the result of a blowup of the islands. 25X1 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Approved For Release 2003/02127 - - 00100020002-2 SECRET 25X1 24. For Peking the situation is not much different. China has gone to some lengths to court Japan in the past two years, and a policy of relative friendliness toward Tokyo is a major element of Chinese foreign policy. A confrontation with Japan runs the risk of pushing Tokyo toward the Soviet Union--a major night- mare from China's point of view--not to mention the obvious damage such a confrontation would do to Peking's burgeoning relationship with Washington. Moreover, an attempt to physically occupy the islands runs the risk of a clash with both Tokyo and Taipei, which greatly complicates the military picture for China. A confrontation with Taipei alone--perhaps an impos- sibility in any event--would hardly be more desirable for Peking. The relationship with the United States, which Peking seems to believe necessary to fend off pressure from the Soviet Union, rests squarely on a tacit understanding that force will not be applied in Peking's continuing quarrel with Taipei; China has in any event gone to considerable pains in the past year to indicate publicly and privately that it is looking toward a peaceful resolution of the Taiwan question. No aspect of Peking's interest in the Senkakus is important enough to put its entire diplomatic position at risk. Similar conditions hold true with respect to Pratas Reef. 25. Somewhat different considerations obtain with respect to the Paracels. In this case Peking is in physical possession of the islands; it need do nothing but stand pat. Taipei, for its part, does not have the military ability to change the situation, nor has it shown the slightest interest in doing so. Nor does Saigon have the military strength to force Peking to disgorge the islands. South Vietnam is certainly not eager for war with China--especially in circumstances where US support is virtually ruled out--and it is not about to divert substantial numbers of ground, naval or air resources from its internal defenses, thereby exposing home territory to North Vietnamese and Viet Cong inroads. 26. In the Spratlys constraints are also opera- tive on all parties. The Philippines would be extremely hard pressed to maintain their meager forces on the islands in the face of a determined push by any of the parties to the dispute. Their interest in the islands does not appear to be acute, their legal claims are obscure, and they appear at this juncture to be backing 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 rapidly away from even the possibility of a clash over the islands. Manila has expressed concern over whether its defense treaty with the US would be applicable. Taipei is too far removed from the Spratlys to bring effective force to bear there in the event of a clash. Since they would find it virtually impossible to abandon or compromise their claims to the islands, however, they would probably find it equally impossible to cooperate effectively with either Manila or Saigon in defense of the archipelago; reported South Vietnamese overtures to this end appear to have fallen on deaf ears. 27. On the face of it, Saigon has taken a much more aggressive posture with respect to the Spratlys than have the other parties to the dispute, risking or even inviting a riposte by Peking to their recent occupation of additional islands in the archipelago. But Saigon probably calculates that the risk is per- haps not all that great. Although Saigon's purpose, at least in part, is to save face following the loss of the Paracels, it is clearly anxious to avoid any confrontation with either Manila or Taipei. Saigon's landing instructions to its troops make that obvious, and the South Vietnamese probably hope that the pres- ence of Philippine and Nationalist forces on the archipelago will in fact be a complication causing Peking to think twice about responding militarily. In the absence of these considerations the South Vietnamese move would be simply foolhardy. Saigon is operating in the Spratlys at the extreme outer edge of its military capability, and it almost certainly hopes to avoid a fight. 28. In fact, the South Vietnamese calculations may not be too far off the mark. Peking would wish to avoid a clash with Taipei in the Spratlys for the same reasons it would wish to avoid a flareup with Nationalists on the other island groups; moreover, it almost certainly calculates that a fight with Filipino forces would evoke a far stronger negative reaction in East and Southeast Asia--particularly in the ASEAN forum--than did its relatively painless clash with Saigon in the Paracels. An operation in the Spratlys that avoided Manila's and Taipei's forces while taking on those of Saigon, on the other hand,. would be extremely difficult to carry out. Peking is probably not certain precisely which islands the South Viet- namese occupy--the Chinese have not attempted to reconnoiter the area since the GVN troops landed. 25X1 Approved For Releas%g,Qt 2 27 : CIA-RDP85T00353R 00100020002-2 25X1 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 Nor, despite Nationalist and Philippine reluctance, can the Chinese be certain that Manila and Taipei would stay out of the action if a fight developed. Chinese vessels would have to maneuver in shoal and poorly charted waters without effective air cover, since Peking like Saigon would be operating at the extreme edge of its military reach. In short, an operation against the Spratlys would be risky politically and militarily. Intentions 29. Insofar as they are involved in the several disputes, Japan, Nationalist China and the Philippines are clearly on the defensive. It would be virtually impossible to make a case that Tokyo, Manila or Taipei are looking for a fight; on the contrary, they are concerned that a fight might be forced on them, and they are clearly anxious to avoid one if possible. Saigon's position is less clearcut with respect to the Spratlys, and perhaps initially to the Paracels as well, but in the latter case the South Vietnamese clearly did not expect a major Chinese response, and on balance it seems likely that they are banking on avoiding one in the Spratlys. The problem, then is essentially one of Peking's intentions. This problem breaks into two parts: has there been a significant shift to a more aggressive Chinese posture; and even if there has not, will Peking feel compelled to respond to the South Vietnamese move in the Spratlys? 30. The first of the questions is easier to answer than the second. Despite China's aggressive actions in the Paracels, the evidence elsewhere does not appear to indicate a general shift in Peking's orientation. Peking's views on, and approach to, larger issues remains essentially as they have been the past two or three years; and Peking has not adopted a new or noticeably more belligerent line on the immediate issue of the islana disputes in the wake of its victory in the Paracels. On the contrary, the Chinese seem anxious to put the matter behind them. Their statement justifying their actions in that archipelago was decidedly defensive in tone, stressing provocation; their decision to release rapidly the South Vietnamese prisoners captured in the fighting also suggests they would like to give the incident a quick burial. If Peking were no longer greatly concerned about the 25X1 SECRET 25X1 Approved For Release 2003/02/ - 0100020002-2 Approved For Release 2003/02/27 : CIA-RDP85T00353R000100020002-2 image it projects to the world, the prisoner release might well have been delayed. 31. Continuity of previous policies seems especially evident in relation to the Senkakus problem. As outlined above, there are overwhelming reasons for the Chinese not to act provocatively in this situation. They have in fact not even taken note of the Japanese government's low-key reassertion of its claim to the Senkakus in the wake of the Paracels action;[- Statements issued from Peking in 1971 and early 1972 indicated clearly that China expected the sovereignty issue and the question of rights to the waters surrounding the Senkakus would eventually be settled through negotiations. Such talks, however, might well involve South Korea, which is engaged in underwater exploration of oil resources in the areas well north of the Senkakus, and perhaps North Korea as well. As recently as March 1973 Peking protested this activity, again implying eventual negotiations were in order. A new statement protesting a Japanese-South Korean agreement on exploration was issued on February 4. The Korean factor is probably a complicating one for Peking, since Pyongyang's own interests loom in the background and this together with the obvious difficulty of arriving at an effective arrangement that would exclude Taipei's claims, may explain why the Chinese are in no hurry to begin 33. Whatever the case in the East China Sea, however, there is no question that the status g_uo has already changed in the South China Sea, and in the Paracels the Chinese were the agents of the change. The issue is whether or not the fighting in the Paracels was deliberately provoked by Peking as part of a concerted effort to absorb the Crescent group. 25X1 25X1 25X1 Approved For ReleaSC2004/27 : CIA-RDP85T00353F1~000100020002-2 25X1 Approved For Release 2003/02/27 - - 100020002-2 SECRET 25X1 A deliberate move of this sort would have obvious implications for China's future course with respect to the Spratlys. Unfortunately, however, the evidence thus far available does not provide a definitive answer to the question. At the very least, the Chinese had at hand well prepared contingency plans for action in the Crescent group, but this would not be surprising under the circumstances. 34. If this is the case, then the equally wide- spread publicity given to the recent GVN landings in the ratlys could result in a similar outcome. Saigon's actions there will be seen as clearly pro- vocative in Peking; and they will have clearly changed the status quo, thus all but calling for a Chinese response. In these circumstances some forceful Chinese reaction cannot be ruled out. But the situation in the Spratlys is very different from that obtaining in the Paracels last month. Even if the Chinese had determined on an operation to root out the Vietnamese, they would have great difficulty in carrying it out. They could not in any case be absolutely certain that they would succeed militarily, and an unsuccessful operation would be far worse than none at all. 35. Moreover, as noted above, the political constraints militating against the use of force in the Spratlys are as real as the military uncertainties; the fact that three or four governments might become involved in a brawl among the islands could in itself preclude any Chinese move. Peking's response to the South Vietnamese move, though toughly worded, was predicable. Continued South Vietnamese assertions of sovereignty over the Spratleys, such as that of February 5, could lead the Chinese to conclude it was necessary to act, but on balance the odds seem to be against a serious military move in the Spratlys. Approved For Release 2 o1i7 h 00020002-2 25X1