* Vietnam looks isolated in South China Sea dispute
* Territorial tensions flare up in region
* Both sides seen as reluctant to back down
* Hanoi likely to raise issue at weekend ASEAN summit
By Greg Torode and Charlie Zhu
HONG KONG, May 9 China's decision to park its
biggest mobile oil rig 120 miles off the Vietnamese coast has
exposed how vulnerable Hanoi, and other littoral states of the
South China Sea, are to moves by the region's dominant power to
assert its territorial claims.
The Communist neighbours are at loggerheads over the
drilling rig in contested waters, each accusing the other of
ramming its ships in the area in the worst setback for
Sino-Vietnamese ties in years.
While Hanoi's dispute with Beijing over the Spratly Islands,
for example, involves fellow claimants the Philippines, Malaysia
and Brunei, it is only Vietnam that contests China's expanding
occupation of the Paracels.
For years now Hanoi has tried to open talks with Beijing
over China's moves on the islands, insisting that they are
While the countries have put aside historic suspicions in
recent years to demarcate their land border and the Gulf of
Tonkin, negotiations stop dead at the Paracels further south.
Whenever the Vietnamese raise the issue, the Chinese say
there is nothing to discuss because the Paracels are under
Chinese occupation and sovereignty and not in dispute, according
to diplomats close to regular Sino-Vietnamese negotiations.
And although officials on both sides now say they want talks
over the intensifying stand-off at sea, where dozens of rival
patrol ships flank the rig, the Chinese are determined to keep
the question of sovereignty off the table.
Wu Shicun, president of the National Institute for South
China Sea Studies, a Chinese government think-tank, said Beijing
was not about to back down over what it calls the Xisha islands.
"I think China will keep moving ahead with its plan (in
Xisha), no matter what Vietnam says and does," Wu told Reuters.
Chinese oil industry sources say hydrocarbon reserves under
the rig's current location remain unproven, and point to
political, rather than commercial, interests driving its
placement on May 2 by China's state-run oil company CNOOC.
Much of the South China Sea is considered potentially rich
in oil and gas, but it remains largely unexplored.
"WORST FEARS" REALISED
Hanoi strategists have been closely watching the
construction and initial deployments of the rig, HD-981, over
the last two years.
"It's been one of our worst fears that it would eventually
be used against us," said one Vietnamese diplomat. "But the
timing has caught us by surprise."
Vietnamese diplomats say they will be pushing for support
when regional leaders gather in Myanmar for a weekend summit of
the Association of Southeast Asian Nations (ASEAN).
But analysts say there is no guarantee of long-term regional
or international support for Vietnam, even as the U.S. slams
China's "provocative" act and urges Sino-Vietnamese negotiations
Vietnam has a range of budding military relationships,
including with the United States, but it has rejected formal
alliances, unlike Japan and the Philippines, long-time
Washington allies locked in their own worsening territorial
disputes with China.
"China does seem to have moved at the point of maximum
vulnerability for Vietnam," said Carl Thayer, an expert on the
South China Sea at the Australian Defence Force Academy.
"There is a risk some other countries will simply say it is
not their problem," he said. "The Paracels (are) not the
Ian Storey, a Singapore-based regional security analyst,
said he did not believe Vietnam was in any mood to back down
either, despite the pressures of facing its historic foe.
"We can anticipate several more months of high tensions,
which I believe could lead to the most serious crisis in
Sino-Vietnamese relations since the 1979 border war," said
Storey, of Singapore's Institute of Southeast Asian Studies.
Storey added that there was no easy path for negotiations to
sort out overlapping exclusive economic zones (EEZs), as China
and Vietnam have done in the Gulf of Tonkin - one theoretical
way out of the current crisis.
"It is a quite a legal knot."
Vietnam formally protested over China's placement of the
rig, saying it was 120 nautical miles from its coast and within
its EEZ under the UN Convention on the Law of the Sea.
The convention gives countries the right to fish and tap oil
and gas resources within such a zone, which must remain
otherwise open to international shipping, including warships.
China's Foreign Ministry spokesman responded by saying that
the rig was "completely within the waters of China's Paracel
Islands", while Chinese analysts noted it was within 17 miles of
the southwestern Paracel island of Triton.
International legal experts said the problem of overlapping
zones was just one of many legal complications in the Paracels
saga, reflecting a tangled Cold War history.
Whatever strengths either China or Vietnam bring to their
claims, each has flaws too, some dating back to China's
occupation of the islands in 1974, according to international
Vietnamese officials have recently sought advice from
international legal scholars about joining a United Nations
arbitration case brought by the Philippines against China's
claims in the South China Sea.
But Vietnamese strategists have yet to show full trust in
the international legal system, and have expanded Hanoi's
military strength in recent years, including purchasing
state-of-the-art warships and Kilo-class submarines from
long-time patron Russia.
The goal, military officials have said, is not to try to
compete with China's military, but to deter Beijing from using
force. They say they will not fire first, but are prepared to
Tran Cong Truc, a former head of Vietnam's border committee,
said Vietnam was a "peace-loving country, but don't wake the
(Additional reporting by Florence Tan in Singapore and Nguyen
Phuong Linh in Hanoi; Editing by Mike Collett-White)