The South China Sea Disputes: A Conflict Managed—Until It Isn’t

The South China Sea remains the world’s most consequential maritime flashpoint, and August 2025 has underscored why. Within days, multiple close calls at sea and in the air reinforced a pattern that has become grimly familiar: routine gray-zone pressure punctuated by sudden spikes of risk. Philippines–China interactions around Scarborough Shoal and Second Thomas Shoal again dominated the headlines, while the United States and a widening circle of partners signaled support through presence and exercises. The disputes are no longer episodic quarrels over fishing grounds or energy blocks; they form a system of daily friction that can drift toward crisis on the back of a misunderstood maneuver, a broken tow line, or a skipper’s split-second miscalculation. What follows is a clear account of what is publicly known, what serious rumors suggest, and how the landscape might plausibly evolve over the next two years.

What is publicly known

The legal baseline. The modern rules of the road are anchored in the UN Convention on the Law of the Sea (UNCLOS), which grants coastal states a 200-nautical-mile exclusive economic zone (EEZ) and various maritime entitlements tied to the character of features—whether they are low-tide elevations, rocks, or islands that can support human habitation. In 2016, an arbitral tribunal convened under UNCLOS rejected the validity of extensive “historic rights” claims inside China’s so-called nine-dash line and clarified the legal status of several features in the Spratlys. Beijing rejected the award, but it remains the central legal reference for most other actors operating in these waters. This mismatch—an award with broad international resonance and a major power that refuses it—defines the legal tension beneath today’s tactical clashes.

Two flashpoints above all. The disputes sprawl across the Paracels, Spratlys, Scarborough Shoal, and the waters off Malaysia and Indonesia. But two points carry disproportionate risk.

• Scarborough Shoal (Bajo de Masinloc/Huangyan Dao). China has exercised effective control since 2012, maintaining a heavy coast guard presence that regulates access to the lagoon and shapes the fishing environment around it. Manila contests this presence and frames fishing access as a livelihood and sovereignty issue rolled into one. Recent months have seen tighter Chinese interception patterns east of the shoal, physical barriers deployed and removed in cycles, and several confrontations at close quarters. The geometry here is unforgiving: a small coral ring, narrow entrances, fast-moving small craft, and big white hulls maneuvering with limited sea room. These conditions make an accident—rather than a deliberate use of force—the likeliest trigger for a crisis.

• Second Thomas Shoal (Ayungin/Ren’ai Jiao). Since 1999, the grounded BRP Sierra Madre has hosted a small detachment of Philippine Marines, sustained by periodic resupply missions. China challenges those runs as illegal “reinforcement,” while Manila insists on its right to maintain personnel on a feature within its EEZ and to supply them safely. The result has been a years-long series of confrontations: water cannons against wooden supply boats, blocking maneuvers at dangerously short ranges, rammings, and directed light devices. Injuries to Filipino crew have hardened public opinion in the Philippines, while Chinese statements emphasize law-enforcement narratives and warnings against “trespass.” Every resupply has become theater, with cameras documenting each pass, each blast, each scraped hull.

A thicker gray zone. China’s statecraft in the South China Sea relies on a layered mix of coast guard cutters, a large maritime militia, and fortified outposts. Militia swarms anchor at or near Chinese-held features, providing a flexible screen that can harry rivals while preserving deniability. This white-hull and militia posture lowers the threshold for pressure while complicating the decision calculus for other states: responding with naval vessels can look escalatory; responding with coast guard vessels risks being outnumbered. A further twist is the legal toolkit. Beijing has promulgated regulations that authorize detentions and tighten enforcement levers inside waters it claims. Even if detentions remain rare, the option itself chills behavior by fishermen, journalists, and humanitarian observers, raising the stakes of routine patrols and inspections.

Allies and partners change the equation. The United States has repeatedly affirmed that its mutual defense treaty with the Philippines applies to armed attacks on Philippine public vessels and aircraft, including coast guard platforms, anywhere in the South China Sea. That phrasing closes perceived loopholes and signals that gray-zone violence against white hulls could have alliance consequences. In recent weeks, U.S. surface combatants and patrol aircraft have operated close enough to the main friction points to be noticed, with public messaging calibrated to avoid cornering either side.

More striking than U.S. behavior, however, is the lattice of regional and extra-regional partners forming around Manila. Australia and the Philippines are running their largest-ever bilateral exercise cycle, emphasizing amphibious, air, and maritime interoperability and building habits that turn occasional drills into a predictable rhythm. Japan’s Reciprocal Access Agreement with Manila—entering into force imminently—creates a framework for visits, logistics, and training that could normalize Japanese coast guard and Self-Defense Forces activity alongside Philippine units. European actors, notably France and the United Kingdom, have raised their profiles with patrols, port calls, and participation in multilateral exercises. None of this is a formal bloc, and all participants calibrate their deployments to avoid foreclosing diplomacy with China. But in aggregate, these moves complicate unilateral coercion and broaden the number of actors with a stake in the day-to-day temperature at sea.

Other claimants maneuver. Vietnam has steadily upgraded and expanded several outposts in the Spratlys, a program that accelerated in late 2023 and continued through 2024 and 2025. The intent is practical—more resilient logistics, better shelter for fishermen, and improved maritime domain awareness—but the political effect is to harden Vietnam’s bargaining position. Malaysia has balanced cooperative rhetoric toward China with quiet insistence on continuing energy activity by Petronas in its EEZ. Incidents near Malaysian gas fields recur, but Kuala Lumpur has shown little appetite for public escalation so long as production proceeds. Indonesia—technically not a Spratlys claimant—defends its North Natuna Sea line where it overlaps with China’s claimed “traditional fishing grounds,” combining firm enforcement actions with sporadic maritime dialogues when tensions cool. Taiwan, though often overlooked in public discussion, maintains modest outposts and patrols that mirror its broader strategic dilemmas.

Why it matters. The South China Sea is an artery for Asia’s trade, energy flows, and protein security. While headline numbers about “trillions in trade” are often used imprecisely, the point stands: a significant share of seaborne commerce and almost all regional LNG traffic pass through these waters. The seabed hydrocarbon endowment is meaningful but not transformational; the political salience of oil and gas derives less from sheer volume than from the location of fields relative to contested lines and the visibility of platforms that can be harassed. Fisheries may be the most underappreciated driver. For coastal communities from Luzon to Vietnam’s south-central coast, access to traditional fishing grounds is about livelihoods and food prices, not just flags on maps. That daily pressure is what keeps small boats pushing into risky waters even after high-profile incidents.

Serious rumors worth tracking

There is no shortage of speculative chatter in Manila, Beijing, and among regional observers. Most of it is noise. A few themes repeat often enough—and align with observable behavior—to take seriously:

• Reclamation at or around Scarborough. Analysts in the Philippines regularly warn that expanded Chinese patrol lines, environmental scouring inside the lagoon, and experiments with semi-permanent barriers could precede hardening the feature’s perimeter. No dredging fleet has appeared, but this remains the red line Manila invokes most frequently, because construction would change facts in a way that is hard to reverse.

• A plan to “resolve” the Sierra Madre. Voices close to the Chinese system periodically call the grounded ship an illegal permanent outpost and hint that “removal” could be framed as maritime safety enforcement. That idea runs headlong into Philippine treaty politics and the Philippines’ position that the Marines aboard are on Philippine sovereign duty. The rumor persists because it dovetails with China’s law-enforcement narrative and Manila’s determination to reinforce the hull.

• Escorted resupply by a coalition of coast guards. After repeated harassment of resupply missions, some in allied circles discuss periodic escorts using mixed coast guard packages rather than naval warships. The logic is to deter water cannons and ramming without inviting warship-to-warship standoffs. No government has confirmed such a plan, and no one wants to advertise it in advance. But the concept keeps surfacing at policy forums, and the math of risk reduction is compelling.

• Quiet construction by others. Vietnam’s reclamation tempo invites speculation that Hanoi seeks to “bank” positions before any ASEAN–China code of conduct locks in realities. Motives are unknowable from the outside, but the pace is a fact, and it shapes bargaining psychology across the claimants.

As always in this theater, rumors graduate to realities only when dredgers, engineering barges, and militia swarms move in observable ways. Watching anchorages and supply chains often yields more insight than parsing spokespeople.

How the disputes are evolving in 2025

From presence to positioning. The tactical picture shows more vessels from more countries operating closer together, more often. China’s on-scene command-and-control looks stretched at times, with cutters, militia hulls, and aircraft coordinating high-tempo intercepts near constricted features. Philippine resupply missions have become both sustenance and signaling, with media embeds multiplying the reputational cost if things go badly. The United States and partners have tightened the rhythm of exercises and presence, which deters worst-case coercion but also thickens the traffic pattern. The cumulative effect is a battlespace where a single misjudged maneuver can create a political problem that capitals struggle to manage.

From diplomacy to lawfare and back. ASEAN–China code-of-conduct talks continue, but the structural gaps remain: the scope of waters to be covered, the status of third-party navies, dispute mechanisms, and, above all, enforcement. Without credible verification and penalties, any code can freeze unequal realities rather than resolve them. Still, all sides keep talking because the alternative—a purely kinetic bargaining process—serves no one. Meanwhile, domestic legal moves, especially coast guard regulations and fisheries rules, create new pretexts for on-water confrontations and raise the stakes for ordinary mariners.

From single ally to a network. Manila’s external balancing is no longer a U.S.-only story. Australia’s integration work, Japan’s access framework and security assistance, and European presence patrols are turning a hub-and-spoke architecture into a loose mesh. Practically, that means more training, better maritime domain awareness, and a wider set of countries invested in preventing an accident from becoming a crisis. It does not mean automatic escalation in Manila’s favor; partners will remain cautious. But it complicates unilateral coercion by raising the audience costs for all sides.

Personal assessment

Two dynamics worry me more than any others. First, operational tempo is outpacing political control. Command centers can write rules of engagement and hotline protocols, but near-feature interactions are decided by people balancing orders, seamanship, and pride in seconds. A fatality is the most plausible trigger for a crisis not because anyone seeks it, but because at ten knots inside a coral ring there is very little margin for error. Once blood is shed, nationalist pressure in multiple capitals will narrow the room for compromise, and the world will discover how elastic the treaties and red lines really are.

Second, legal overreach is acquiring physical teeth. The authority to detain foreigners, seize catch, or impound vessels under domestic regulations may begin as signaling but can become practice by accretion. A high-profile detention—of fishermen, coast guard crew, or journalists—would force public responses and reduce the utility of back channels. That kind of episode would test the ladder of escalation management that all sides claim to prefer.

Both risks are amplified by the Taiwan factor. Manila’s leaders have been more explicit about the Philippines’ exposure to a Taiwan contingency, citing geography and evacuation obligations. Beijing treats such statements as provocation. Even if neither side seeks to link the crises, rhetoric and exercises bleed across theaters, raising the temperature in both.

Four plausible outcomes (12–24 months)

1. Tense equilibrium with thicker guardrails (base case, ~45%).
   Mechanics. Friction continues at Scarborough and Second Thomas, but fatalities are avoided. ASEAN–China talks stumble forward on narrow technical steps—hotlines, notification protocols, agreed procedures for medical evacuation—without touching sovereignty. Manila deepens trilateral and minilateral cooperation, converting exercises into standing routines. The U.S. maintains a predictable cadence of presence operations without theatrical spikes. Japan’s access agreement turns into regularized training and maritime domain awareness projects.
   Indicators. Regularized Australia–Philippines exercises; Japanese coast guard and Self-Defense Forces activities integrated into Philippine training cycles; intermittent U.S. destroyer and patrol aircraft appearances near flashpoints; Vietnamese construction continues at a measured pace; Malaysia and Indonesia sustain energy activity while handling incidents quietly.
   Implications. Risk remains high but manageable. Markets treat incidents as noise; fisheries pressure and domestic politics periodically spike. Diplomacy keeps the temperature below boiling but does not lower it.

2. Crisis followed by a rules-lite accommodation (stabilization after shock, ~25%).
   Mechanics. A serious collision with injuries or a short-duration detention of Philippine crew triggers a coordinated response: temporarily escorted resupply missions using mixed coast guard packages and a wave of diplomatic demarches. After a tense few weeks, back-channel talks produce a modest operational understanding: no ramming, no water cannons within specified distances, guaranteed medevac, and a tacit cadence for Sierra Madre resupply. The arrangement is informal, reversible, and sovereignty-neutral.
   Indicators. Sudden appearance of multinational coast guard convoys; restrained official language about “avoiding misunderstandings”; Manila reduces media embeds on resupply runs in exchange for steadier access; ASEAN statements emphasize “modalities” rather than the core code.
   Implications. Tempers cool, and the region moves on without resolving anything foundational. The precedent of escorted resupply lingers, and the next crisis will escalate from a higher baseline.

3. Limited armed clash and short escalation ladder (dangerous tail, ~20%).
   Mechanics. A high-speed collision at Scarborough or Second Thomas produces fatalities. Public outrage hardens positions. China surges cutters and militia into the immediate area and announces temporary exclusion zones. Manila deploys naval escorts for resupply and declares a maritime emergency. The United States and close partners intensify presence; an exchange of warning shots or disabling fire occurs during a blocked mission. After a few perilous weeks, capitals count costs and step back to an uneasy plateau, but with more forces in contact than before.
   Indicators. Explicit treaty language from Washington and Manila tied to the incident; rapid convening of allied maritime exercises in the Philippine Sea; emergency trips by senior defense officials to Manila and Tokyo; a contentious UN Security Council session that hardens narratives.
   Implications. The crisis ends without war, but the barriers to future coercion are higher, media narratives are more polarized, and practical cooperation—on fisheries management or search-and-rescue—becomes harder.

4. Strategic shock: a move on the Sierra Madre or reclamation at Scarborough (low probability, high impact, ~10%).
   Mechanics. Beijing attempts to remove or neutralize the grounded ship under a “safety” or “environmental” pretext, or dredgers appear near Scarborough in a bid to harden the feature. Manila calls treaty consultations and requests visible partner presence. Expect a surge of coast guard and naval vessels, targeted economic measures, and a prolonged standoff that becomes the defining security story in Southeast Asia for months.
   Indicators. Engineering barges, dredging fleets, or modular pier components moving into position; unusual militia massing at designated anchorages; new administrative notices from Chinese maritime agencies; rapid movement of Japanese and Australian assets into Philippine ports.
   Implications. Even if shooting is avoided, strategic trust collapses. Southeast Asia’s hedging narrows, and external actors institutionalize their presence. A future code of conduct becomes harder to negotiate and even harder to sell.

What to watch next

• Behavioral shifts at Scarborough. The reappearance of barriers across the lagoon entrance, or a sustained pattern of interceptions farther east of the feature, would signal a tighter squeeze on Filipino fishers and more hazardous high-speed chases. Small tweaks in patrol geometry often presage larger steps.

• Resupply cadence and composition at Second Thomas. A move toward smaller, quieter runs would suggest Manila is buying tactical predictability; highly publicized convoys would indicate a strategy of internationalizing deterrence. The presence—or absence—of partner observers or coast guard escorts will be telling.

• Operationalization of the Japan–Philippines framework. Once the access agreement is in force, the pace of joint training and maritime domain awareness projects will reveal whether paper architecture is becoming lived practice. Watch for integrated radar and information-sharing that improves cueing ahead of confrontations.

• Energy plays off Malaysia and Vietnam. Chinese patrols near Malaysian platforms and Vietnam’s drilling activity create steady friction even when the spotlight is on the Philippines. Any forced halt or significant delay of an energy project under harassment would ripple politically and economically.

• Narratives after U.S. presence operations. Competing official accounts about who “drove off” whom are now part of the signaling game. The pattern of announcements—how quickly they appear, how specific they are, whether imagery accompanies them—matters almost as much as the presence itself.

Bottom line

The South China Sea dispute set is not one crisis but a system: overlapping legal claims, a thickening gray-zone toolkit, and an expanding network of actors who seek to uphold order without triggering war. Beijing’s approach—coast guard and militia pressure backed by fortified outposts—aims to shift facts on the water below the threshold of armed conflict. Manila’s strategy—law, presence, and partnerships—seeks to raise the cost of that pressure and to keep resupply and fishing viable. Others calibrate between principle and prudence.

Our view is that the near-term base case remains continued friction with slightly better guardrails. The region’s diplomats will celebrate incremental gains—hotlines that work, notification protocols that reduce surprises, and training that improves seamanship under stress. But the risk tail is real. A single fatality at sea or a high-profile detention under coast guard regulations could push leaders onto escalation ladders they would prefer to avoid. Even then, the paradox that has made this dispute so durable will persist: no one wants a war over reefs, but no one wants to look like they backed down. The space between those two truths is where August 2025 leaves us—nervous, watchful, and one bad turn of the rudder away from a crisis that none of the principals truly seeks.