Friday, July 30, 2010

Exxon and BP in the South China Sea

Why has the South China Sea dispute jumped into the news recently, after simmering for years on the back burner ? Why did Hillary Clinton just spring one on China at the recent Asean meeting ?

Probably because of this:

The Chinese government considers the entire South China Sea as its own, dismissing claims from Southeast Asian countries to islands such as the Spratlys, and is building an ocean-going fleet to project power beyond its borders. China told Exxon Mobil Corp. and BP Plc to halt exploration in areas that Vietnam considers part of its territory, according to U.S. government agencies(1)

China views the sea as their sovereign territory by historic right. But by interfering with the market growth of these two companies China probably made a huge tactical error. Exxon is as a tied to the U.S. elite as any corporation can be, as is BP with Great Britain. The CCP substituted nationalist fervor for Maoism and might have painted itself into a box politically which it can't get out of.

1'China Says Its South Sea Claims Are `Indisputable' - Bloomberg

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