Beyond the technological war, whose outcome remains uncertain and, apparently still far away, what is certain is that China is consolidating its positions to turn the strategic South China Sea into a closed preserve, something similar to what the Caribbean became for the United States in the last century.

The so-called Chinese dragon continues to grow in all aspects, as the latest Forbes magazine list on the world’s 500 largest companies indicates: “Excluding Taiwan, 119 companies from mainland China and Hong Kong made it to the list, almost on par with the US. This is a historic shift,” the magazine said in a statement.

Since 2001, there has been a significant change in the geographical distribution of companies in the ranking. The US had 215 in 2001, which fell to 121 this year. Meanwhile, China was only at 10 in 2001 and went to 129 today, if Taiwan’s ten are counted in this year’s Fortune Global 500 list. Three large Chinese state-owned companies (Sinopec Group, China National Petroleum and State Grid) are among the top five companies this year.

But the centre of Beijing’s power is increasingly being expressed in the South China Sea. Two central data are emerging these days: in addition to the seven fortified artificial islands built by China in the sea, it now secured the transfer of a Cambodian naval base that can disrupt regional balances and, in parallel, exercises with anti-ship missiles were known in the proximity to the disputed Spratly and Paracel Islands (Nansha and Xisha).

The first information came from the Wall Street Journal that claimed China and Cambodia signed a secret agreement that allows the Dragon Navy exclusive access to the Ream naval base in the Gulf of Thailand for 30 years. Although the Phnom Penh government denied the version of events as reported, largely because it would be an unconstitutional agreement, in fact, Cambodia is China’s main ally in the region.

In 2017, the Government of Cambodia cancelled the Angkor Sentinel bilateral military exercises with the US and now performs them exclusively with China. Washington’s reaction was swift. Emily Zeeberg, the spokesman for the embassy in Phnom Penh, urged the Cambodian government to respect its so-called constitutional commitment to pursue an independent foreign policy.

An additional important fact is that the naval base is located a short distance from an airport that is being built by a Chinese company. This is the Dara Sakor airport, in the coastal province of Koh Kong, whose runway exceeds 3,200 meters, which allows the landing of large planes. In addition, a tourist resort that occupies 45,000 hectares is under construction where 3,800 million dollars will be invested by the Chinese Union Development Group.

On the other hand, between June 29 and July 3, the Chinese Navy conducted real tests with medium-range missiles between the Spratly and Paracel Islands, in a block of 22,000 square kilometres. Among the missiles tested is the DF-21D, with a range of 1,500 kilometres, which is also known as the “aircraft carrier killer” for its ability to fall vertically on the target, which makes defence very difficult.

The DF-26 missile was also tested at a range of 5,000 kilometres and is capable of a nuclear warhead. This missile can reach the island of Guam, where the US has one of the most important military bases in the Pacific.

According to an Asia Times analysis, the tests were a warning to the United States that their warships and aircraft carriers are vulnerable when crossing the South China Sea, or if they come to the aid of their allies in the waters in dispute with Beijing. In such a situation are the countries of Japan, Taiwan, Vietnam, the Philippines, Malaysia, Brunei and Indonesia.

For China, the South China Sea region is doubly problematic. On the one hand, hegemony in these waters has a strategic military character, since it is the space from which it can suffer aggression, as has happened in the past, with the English and French imperial fleets. In addition, one-third of the world’s maritime transport crosses the South China Sea, which represents the bulk of China’s exports and imports. The “freedom of navigation” demanded by Washington goes against the sovereignty claimed by China, which is turning those waters into a space for the exclusive use of its Navy.

In the opinion of journalist Jonathan Manthorpe of the Asia Times, the withdrawal of the Trump administration from the IRNF (Intermediate-Range Nuclear Forces) treaty creates an extremely dangerous situation. The treaty was signed in 1987 by the presidents of the US and the USSR, prohibiting missiles of up to 5,500 kilometres: It was negotiated and agreed because both the Soviet Union and NATO understood that the deployment of what was called ‘tactical nuclear weapons’ could trigger an escalation of conflicts that would lead to nuclear war.

The situation would be similar, in his opinion, to what was experienced in Europe 40 years ago. That is why he concludes, with irony, that it would be wonderful to believe that Xi and Trump have the same wisdom to face the dangers of this situation that Reagan and Gorbachev had. Beyond the irony of the journalist, there are two elements that are true. The first is that the situation can become dramatic if the two powers that dispute the Pacific seas do not find the ways of dialogue to solve the problems that, for now, they call a “trade war”, when in reality it is a broad dispute that ranges from cutting-edge technologies to maritime and military hegemony.

The second is that China does not stop advancing, step by step, in all areas, including in the South China Sea, into something similar to what the Romans called “Mare Nostrum” or “Our Sea”, in reference to the Mediterranean.

DISCLAIMER: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy and position of Regional Rapport.
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Paul Antonopoulos is a Research Fellow at the Center for Syncretic Studies. He has an MA in International Relations from Western Sydney University. His research interests include the international relations and the political economy of the Middle East and Latin America and Big Power Rivalry. He is the co-author of "Syria: The Hegemonic Struggle Between Iran and Saudi Arabia." He appears on PressTV, RT and Indus News, and Sputnik Radio.