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China-Vietnam spat could hit oil and gas firms

Monday, August 7, 2017

Significance

This marked the reassertion of one of China's most provocative positions, an implied claim to energy resource rights across the area enclosed by its 'nine-dash line', in contravention of the 2016 ruling. Beijing had refrained from pressing this expansive, and now unlawful claim, since around late 2012.

Impacts

  • Offshore energy projects in Chinese-claimed waters will be vulnerable to Chinese coercion.
  • Vietnam will further intensify security ties with India and Japan.
  • China's pressure likely seeks to spur Vietnamese and Philippine agreement to joint energy development, on terms favouring China.
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