Chinese ships threaten Vietnam’s Lan Tay rig and Hanoi’s cryptic actions

Hình minh hoạ. Giàn khoan JDC Hakuryu-5 ở ngoài khơi Vũng Tàu hôm 29/4/2018
Chinese Coast Guard ship appeared near Block 06.1

According to a number of independent journalists and reporters, on the morning of July 4 – the National Day of the US, China’s 5402 maritime vessels provocatively approached the Lan Tay rig operating in Lot 06.1, which Vietnam is exploiting.

This information has also been verified and confirmed by the East China Sea Project through the analysis of AIS data.

According to the East China Sea Project, AIS data shows that China’s 5402 Coast Guard left Sanya on the morning of July 1, 2020, and moved south. On the afternoon of 2/7, the ship got down to the Subi rock area and operated in this area until 3/7 morning. On the morning of 4/7, the ship headed for the Lan Tay gas field at Lot 06.1 with great speed, 15 knots. The closest vessel position to the Lan Tay platform that can be identified via AIS is at 9:57 am 4/7, at a distance of about 1.3 nautical miles northeast. At 10h24 ‘on the same day, still, at the same high speed, the 5402 seascape ship moves about 2.85 nautical miles to the southeast. Then the ship moved southeast to Vanguard Bank, about 30 nautical miles from the platform, slowed down, and moved slowly, even stopping in this area. At 8:45 am on July 5, 2020, the ship is located about 36 nautical miles southeast of the Lan Tay rig. After that, Hai Canh 5402 ship was still in Vanguard Bank’s area. A Vietnamese fishery inspection ship closely follows the Chinese ship.

What message does China’s action convey?

Why is China acting so provocative in this region and this time? There can be 3 reasons as follows:

Firstly, it comes from internal problems of China.

The COVID-19 pandemic has caused enormous damage to the Chinese economy due to the first closure of economic activities and subsequent global demand decline. Exports still account for 30% of China’s GDP, so the country cannot avoid external shocks. However, domestic consumption has increased and is currently the most important growth engine.

This transformation of domestic consumption into this leading growth engine has been in progress for nearly a decade. COVID-19 is only one factor to accelerate this trend. The economic shocks caused by the pandemic are destroying global trade to such an extent that external demand for Chinese exports is unlikely to recover within two to three years. The trade and technology war with the US, one of China’s largest trading partners, is also creating long-term risks. These factors have led Chinese leaders to speculate that the global economy will be fragmented and de-globalized.

The COVID-19 pandemic and increasing hostility towards the US are accelerating changes in China’s political economy.

Therefore, this is a continuation of China in a series of aggressive actions shown to many different countries, possibly to distract the Chinese people from the problems in the country and growing discontent towards President Xi Jinping. There are unprecedented demands for Xi Jinping to resign due to many of his policies, including how to handle COVID-19 in Wuhan. People are losing faith in Xi Jinping’s leadership and are starting to question his promise of the “Chinese Dream” when China will become a well-to-do country in 2021, the 100th anniversary of the founding of the Chinese Communist Party “.

Restoring sovereignty over Chinese territories lost to unequal treaties with foreign powers” is a commitment of Xi Jinping in the “Chinese Dream.” Strengthening military activities in territorial disputes with its neighbors seems to be the only possible flag that Xi can raise to gather confidence in Chinese society.

Second, this is also the signal that China wants to give to the US and other countries in the South China Sea. Although recently, Vietnam as the ASEAN President has urged ASEAN countries to issue a Declaration, which upholds the role of UNCLOS, as a message to Beijing. Earlier, Malaysia, the Philippines, Vietnam, and Indonesia had sent diplomatic notes / official letters to the UN to protest China’s unjustified claims in the South China Sea, as well as to cite the arbitral tribunal’s judgment in the Philippines Case against China in 2016. This action of China seems to show that, despite the support of the US for other claimants as well as based on the 2016 Judgment, China is still the most powerful party in the South China Sea. And ASEAN and the US should not disregard China’s power and determination to monopolize the South China Sea.

Vietnam with many implications. Vietnam is still the most active country in ASEAN to seek to condemn China. For China, Vietnam is the “most stubborn.” Therefore, China wants to “rule” Vietnam first, then to other ASEAN countries. In addition, Vietnam is preparing for the 13th Party Congress. This is in fact the preparation for personnel for the new class, so this is also a “warning” from Beijing for leaders. Vietnam, do not have to leave the “tide.” In addition, this is also a “reminder” when Vietnam is “warm” with the US in many fields, especially in defense relations. Therefore, with the threat of Block 06.1, China has just reached an intention to prevent Vietnam’s fishing activities, forcing Vietnam to implement the policy “to stop confrontation but for joint exploitation.” In addition, China wants to send threat signals to the exploitation of other ASEAN countries such as Malaysia, the Philippines, and Indonesia. Although the area of ​​Block 06.1 is located on the Nam Con Son basin, very far away from the area of Vanguard Bank that China calls it Van An Bac, but China still wants to turn this area into a “disputed area” according to the intention of Beijing.

the path of the Chinese coast guard near Lan Tay rig

Vietnam’s confusing actions?

One noteworthy issue is the confusing action from Vietnam. Right from the end of May, there have been reports of the Vietnamese Government considering continuing exploration and exploitation at Lot 06.1. Although the Vietnamese side seldom makes official announcements on this issue. But public opinion has speculated with reasonable grounds when Vietnam hired Noble Clyde Boudreaux Rig and anchor this rig from April 30 to present in Vung Tau.

In early June, the Vietnamese Politburo was unable to decide whether to continue the exploration and new exploitation at Lot 06.1, of course, because of the fear of the threatening pressure from Beijing.

It is understandable that Vietnam could not decide to conduct new exploration and exploitation under Beijing’s pressure. Previously, in 2017 and 2018, under pressure from China, Vietnam asked Repsol Company to suspend exploitation in Plots 136.3 and 07.3. This has led to concerns for international investors in the oil and gas sector investing in mining projects in Vietnam. Therefore, Vietnam needs to be cautious about its decisions, because if new exploration and exploitation are continued but stopped when China pressures, it will lead to physical and strategic losses of Vietnam. And that has led to the fact that the Vietnamese Politburo has yet to decide whether to continue or not for new exploration and exploitation in Lot 06.1.

Therefore, it is understandable to be prudent not to decide which exploration to exploit. But why does the Vietnamese side rent the Noble Clyde Boudreaux Rigs for $135,000/day while having not yet decided whether to do it or not. No one does not understand the purpose of Vietnam?

The fact that it has not been able to make a decision but has hired the rig has made public opinion that Vietnam looks impulsive. This has created significant pressure for Vietnam itself as the Chinese ships have come to threaten Vietnam’s waters and the rig at Lan Tay recently. Not to mention that with the rental price, during the past month, the amount of money that Vietnam has to pay for renting the Noble Clyde Boudreaux rigs is up to millions of dollars, while failing to meet the target of exploration for new exploitation and the Vietnamese economy is facing a lot of difficulties with the COVID-19 pandemic, the above amount is clearly not a big deal to help revive its economy.

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