Date first published: 25/07/2017

Key sectors: maritime; oil; gas

Key risks: war

Between 10-17 July the navies of the United States (US), India and Japan took part in the annual ‘Malabar’ exercise in the Bay of Bengal, a series of war games aimed at improving coordination and sharing best practice. Japan is a recent addition to the exercise and sent a destroyer along with the JS Izumo, its largest and most sophisticated naval vessel that looks like an aircraft carrier. Since late May and now after the Malabar manoeuvres, the JZ Izumo will return to a tour of Southeast Asian ports.

Annual training and manoeuvres through Southeast Asia would be fairly unremarkable for ships belonging to most navies, but not so for Japan’s. Earlier in May JZ Izumo made history just by escorting US supply ships from Japan to a warship strike group in the Pacific. It marked the first time since the Abe government revised Japan’s post-World War Two pacifist laws to allow Japanese troops to go abroad and support allies. Each of JZ Izumo’s activities have drawn ire in Beijing and among the Communist Party’s nationalist newspapers, with the Global Times arguing Japan was jeopardising peace in the region and the usually-soberer Xinhua urging that Tokyo ‘refrain from causing trouble in the region’.

Such vitriol towards Japan’s port visits might appear highly ironic coming from a government that sparked riots in Vietnam in 2014 by moving an oil rig into the country’s Exclusive-Economic Zone (EEZ), forcibly removed Philippine fishing boats from the contested Scarborough Shoal in 2012 and which sailed its new Liaoning aircraft carrier through the Straits of Taiwan and through Taiwan’s defence identification zone in July 2017. Yet these events are clearly linked. Since China began to act more assertively in both the South China and East China Seas from around 2009 onwards, it has been keen to prevent a united front of countries from appearing and has simultaneously used its outrage to justify further action.

Facing growing incursions from China in the East China Sea and with the longstanding issue of sovereignty over the Senkaku/Diaoyu islands continuing to simmer, Japan has made a point of trying to build support from Southeast Asian nations who face territorial disputes with China in the South China Sea. The latter increasing takes a major share of military investment. On 16 May Singapore announced that it would purchase two new submarines from Germany to add to its already considerable fleet, Malaysia operates two French submarines, Vietnam has six and last year agreed to purchase littoral ships from the US. Rumours persist that Thailand intends to enter the submarine game and has agreed US$376m to purchase its first of three from China.

While China continues to increase its military spending by around 7 per cent each year and build up its naval capabilities, Japan likely remains East Asia’s premier naval power after the US. To remain ahead of an increasingly belligerent China, Japan will look to nurture partnerships with Vietnam, the Philippines and India, even as the US appears to vacate its traditional role as the region’s guardian under President Donald Trump. This does not mean that China will not miscalculate as it asserts its claims in the region, however, increasing the risk of naval conflict – a trend likely to persist as the naval build-up continues.