China’s greatest strength is at the same time its greatest weakness. With the second largest global economy, about 60−70 percent of China’s economic activity today is directly or indirectly linked to trade with other nations.1 In 2011 85 percent of China’s total trade was by sea.2 In this regard, the country is increasingly dependent on maritime trade—and the security of its sea lanes—for its economic vitality, high standard of living, and military strength.
To sustain its economic growth, China must increasingly rely on external sources of raw materials and energy and is working toward growing its reserves. In 2011, China had oil reserves sufficient for only 50 days, but its aim is to increase these to 500 million barrels or 90 days by 2020.3 As the country grows more dependent on oil, its ability to ensure access to energy at an affordable price becomes even more critical and could prove difficult due to the uncertainty of the global market.4 While China has made great efforts in recent years to reduce its seaborne oil and gas traffic by using more reliable and less vulnerable pipelines from Russia, Central Asia, and Burma, according to some estimates even working at full capacity these pipelines would be able to transport only about 14 percent of the country’s oil and gas imports in 2015.5
Uninterrupted flow of ships in and out of Chinese ports is critical in this effort, as any major interruption in the delivery of oil, gas, and other raw materials would have serious consequences on the economy. The Chinese, though, have a limited ability to protect their trade in the Indian Ocean and through various international straits; this is especially true for the Straits of Hormuz and Malacca.
The greatest threat to Chinese shipping would be war with a major sea power. History shows that preserving one’s military-economic potential, including land- and maritime-transportation systems at sea, while destroying or weakening an enemy’s, will remain an integral part of any protracted war. Even in the regional wars fought since 1945, as demonstrated in the Iran-Iraq War of 1980−88, both sides attacked the enemy’s merchant shipping at sea and in ports and defended friendly shipping. Despite the contemporary belief that waging war against an opponent’s maritime trade is unlikely, there is little doubt that this would be the case in a future major conflict at sea, suggesting there are limits to economic interdependence.
Shipping Route Traffic
China’s open-ocean transport routes pass through every continent and ocean, reaching more than 600 ports in over 150 nations.6 The most important segments of the sea routes to Chinese ports are those across the Indian Ocean and the South China Sea, which are long, exposed, and consequently vulnerable in a war. The Indian Ocean is the busiest maritime-trade area, with some 80 percent of the world’s oil trade transiting it.7 Today, some 60,000 ships per year pass through the South China Sea, accounting for approximately 50 percent of the world’s maritime trade in tonnage—or five times that of the Panama Canal and twice that of the Suez Canal.8 Additionally, half of the world’s oil supplies and 66 percent of exported natural gas are transported through the South China Sea.9
Chinese ships must pass through several international choke points on their way to or from ports on the mainland. Those sailing from the Mediterranean must pass through either the Suez Canal then Bab-el-Mandeb or use a much longer route through the Strait of Gibraltar and around the Cape of Good Hope. The Straits of Hormuz and Malacca are the most critical but also the most vulnerable of the world’s choke points. In 2010, some 2.4 million barrels per day, or 40 percent of China’s oil imports, passed through the Strait of Hormuz.10 In 2012, about 82 percent of Chinese oil imports passed through the Strait of Malacca.11
Should that strait be closed, there are several possible alternate routes, including the Lombok Strait (Selat Lombok) between the islands of Bali and Lombok, the Makassar Strait, and the Sunda Strait (Selat Sunda). Most northbound ships have to pass through the Makassar Strait, which is between Borneo and Sulawesi (formerly Celebes) and normally used by ships too large to transit the Strait of Malacca. The Sunda Strait between Java and Sumatra offers the most direct route for the ships sailing to or from the Cape of Good Hope and North Asia. Many large ships avoid using the Sunda Strait, though, because it is too narrow and shallow and features navigational hazards like numerous sandbanks and strong tidal currents.12 The route through the Sunda Strait and the Lombok Strait would add 965 and 1,600 nautical miles or 2.5 and 4.8 transit days (at a speed of 14 knots) respectively to Chinese ports.13 Other possible but longer alternate routes are through the Straits of Ombai, Wetar, and Torres.
PLAN Doctrine
In contrast to Western experts, the Chinese military has a more realistic view of the dangers a major war at sea poses to the country’s maritime trade. The realization of the need to prepare both to attack the enemy’s maritime trade and defend their own is reflected in China’s policy and strategy as well as the People’s Liberation Army’s Navy (PLAN) joint operational planning and exercises. The PLAN’s operational doctrine elaborates in some detail the sea-line interdiction campaign (a major naval operation to attack enemy maritime trade in western terms) and the sea-line guarding campaign (a major naval operation to defend and protect maritime trade).14
The sea-line guarding campaign (bao jiao) aims to ensure the safe and free passage along strategic lines of communication and other sea routes, and the safety of ports and other maritime transport activities. The PLAN’s doctrine differentiates between a sea guarding campaign (a major operation in U.S./NATO terms) to defend a strategic asset (wuzi) and a campaign to protect a certain sea line possessing strategic campaign (actually operational) significance. The first will be relatively short in duration, while the other would be fairly long and might be conducted through the entire war.
The Chinese assume that the enemy would have the initiative and would not only conduct strikes against loading ports but also establish a naval blockade and attack Chinese merchant shipping. In their view, all the sea lanes must be protected, which requires offensive operations against enemy naval and air bases, as well as fixed targets such as loading/unloading ports and intermediate (smaller) ports, and so-called dynamic targets such as transport ships. Such a campaign would be long and require a commitment of large forces.15
Defensive Capabilities
Currently, the PLAN can use its ever-growing force of destroyers, frigates, and corvettes to defend and protect maritime trade. While some Chinese submarines could also be indirectly employed for defense of maritime trade by attacking enemy surface combatants, in a major war at sea most surface ships and submarines would be employed for sea denial in the waters within the First Island Chain. Also, the PLAN’s antisubmarine warfare capabilities are considered generally poor. The People’s Liberation Army Naval Air Force has strong ground-based air defenses and a substantial number of reconnaissance and attack aircraft, which can be very effective in defending Chinese ports and merchant shipping within their effective range.
China’s ability to defend and protect its maritime trade is probably greatest in the three seas bordering the mainland coast. Despite access to some ports and naval facilities in the friendly countries in the Indian Ocean, the Chinese would be unable to effectively protect their shipping transiting the area. The single greatest vulnerability there is China’s lack of control over key maritime trade choke points. If plans to build more carriers in the next decade are realized, it would provide a much stronger naval influence within the First Island Chain and possibly in the Indian Ocean. However, carrier groups can only provide distant cover to ships in the Indian Ocean. They cannot secure control of the Straits of Malacca or Hormuz or other passages in the region.
War on Maritime Trade
In contrast to traditional and historically-supported views, many contemporary experts believe that war against an opponent’s maritime trade is highly unlikely in the future. To justify these views, they assert that the degree of interconnectedness today is much greater than ever, while others assert that the importance, structure, and pattern of maritime trade differs significantly from the past. They also claim that financially merchant shipping matters less today since the Internet dominates the transfer and accumulation of capital. Additionally, the supporting infrastructure ashore for merchant shipping is supposedly a less important part of the maritime economy due to the increasingly sophisticated and diverse financial infrastructure and the greater importance of the marine-resource industry.16 Yet, the ever-growing size and sophistication of the merchant fleets, ports, and associated facilities ashore are the best proof that these and similar views contradict reality. China and other major countries must have vibrant maritime trade to secure the overall health of their economies and maintain their standard of living.
Many Western experts assert that a large-scale attack on merchant shipping is also unlikely due to the global nature of maritime transportation, which would greatly increase the commercial and political penalties of such a transgression. An attack on any part of the world’s economic system could easily rebound on the perpetrator.17 Among other things, experts point out that any disruption to the sailing schedules would have a cascading effect across the entire globalized system of maritime trade. In their view, any attack on merchant shipping in a war would have a highly adverse effect on the attacker because of the political and psychological effects on a complex, tightly coupled intermodal transportation system.18 Also, many shipping companies, whose vessels carry cargo destined for foreign ports, are owned by a number of banks from different countries. This reality is likely to deter an attack on an enemy’s merchant shipping.
Such views can be successfully challenged. Since it is unrealistic that one’s ships would carry cargo to ports controlled by the enemy, the cargo content and pattern of maritime trade would change drastically once hostilities at sea begin. Hence, possible losses for the attacker would be limited only to the initial phase of a war at sea. Afterward, the ships sailing under one’s own or a friendly flag would not carry cargo to the enemy ports. Although an attack on an enemy’s maritime trade would include attacks on ports and cyber war, it ultimately would not be successful without destroying ships at sea or in ports.
Limits to Interdependence?
Obviously, a war between major powers in a globalized world is possible, but it might not be probable or even likely. At the same time, it would be highly imprudent not to prepare for a war against an enemy’s maritime trade and to defend/protect friendly trade. A globalized world is not a new phenomenon, as countries have been increasingly interconnected since the 18th century. For example, between 1890 and 1913 Britain’s imports from Germany tripled while its exports to Germany doubled. France had almost the same amount of trade with Germany as it had with Britain, and Germany was heavily reliant on France’s iron ore for its steel production. That London was the largest European financial center and the ruling houses in imperial Germany, Britain, and Russia were blood-related did not prevent these countries from stumbling like “sleepwalkers” into what is generally considered the single most catastrophic event in the 20th century.19
Additionally, U.S.–Japanese economic interdependence actually contributed to tensions prior to World War II. Russia and Germany were economically interdependent both in 1914 and 1941, but that did not prevent their going to war with each other.20 Experience shows that security concerns, domestic politics, nationalistic zeal, misunderstandings, blissful ignorance, hostility, and other factors—some of them self-defeating or even irrational—might lead to a war no one wanted.
In Europe prior to 1914, it was a widely shared view among the educated elite that war, since it would lead to the collapse of international capital markets, had became obsolete. In war, all trade would stop, causing harm to both belligerents and neutrals. In fact, this would make war impossible to continue for more than a few weeks.21 Sir Norman Angell in his splendid but grossly misleading book, Europe’s Optical Illusion, published in 1909 (republished in 1910 and retitled in 1933 as The Great Illusion), asserted that “a military power is socially and economically futile. . . . Wealth in the economically civilized world was founded upon credits and commercial contracts based on an ever-increasing division of labor and highly developed communications. If these are tampered with in an attempt of confiscation, then credit-dependent wealth would be undermined and its collapse would involve that of their conqueror.”22 Angell observed that international commerce had become so interwoven with trade and industry that trade became as untouchable as property.23 He also believed that large navies were impotent to protect trade for the nations owning them and can do nothing to “confine the commercial rivalry” of other nations.24 He asserted (erroneously) that armies and navies cannot destroy the trade of rivals, nor they can capture it.25 And we might add, the rest is history.
Chinese maritime trade is expected to grow at a rapid pace in the future. The need to secure an uninterrupted flow of energy, ores, and food will remain one of the most critical factors driving China’s policy and its maritime strategy. U.S. decision makers, operational commanders, and their planners should always keep in mind that in contrast to the former Soviet Union, China has to and will become a major naval and maritime power. Short of war, it is not possible to properly assess the soundness of the PLAN’s doctrine and capabilities for protection of maritime trade. At the moment, the Chinese do not seem to have adequate resources to ensure the safety of their commerce even within the South China, East China, and Yellow seas, but this will probably improve as more modern surface combatants and attack submarines enter service. The single biggest problem for China is protecting its shipping transiting the Indian Ocean. Short of securing full control of the key choke points, its maritime trade would suffer prohibitively high losses in a major war at sea.
1. Ryan Clarke, Chinese Energy Security: The Myth of the PLAN’s Frontline Status (Carlisle, PA: The Letort Papers, Strategic Studies Institute U.S. Army War College, August 2010), 1.
2. Michael D. Wood, Chinese Maritime Power—Is the Increase in China’s maritime power internally consistent with China’s national interests and foreign policy, or cause for concern? (Kingston, Ontario: Royal College of Defence Studies, July 2012),10.
3. Ryan Henry, Christine Osowski, Peter Chalk, and James T. Bartis, Promoting International Energy Security, vol. 3, Sea-Lanes to Asia (Santa Monica, CA: RAND Project Air Force, 2012), 19. Henri Philippens, “Fueling China’s Maritime Modernization: The Need to Guarantee Energy Security,” Journal of Energy Security, 14 December 2011, 4, www.ensec.org/index.php?option=com_content&view=article&id=332 :fueling-chin. U.S. Energy Information Administration (EIA), “China,” 16, last updated 2 February 2014,www.eia.gov/countries/cab.cfm?fips=ch.
4. James A. Brandenburg, China’s Energy Insecurity and the South China Sea Dispute (Carlisle, PA: U.S. Army War College, 2011), 6.
5. Henry, Osowski, Chalk, and Bartis, 6.
6. Wood, 11.
7. John Lee and Charles Horner, “China faces barriers in the Indian Ocean,” Asia Times, 10 January 2014, 2, www.atimes.com/China/CHIN-02-100114.html.
8. Richard Rousseau, “South China Sea: Rising Tensions But No Permanent Solutions on the Horizon,” Foreign Policy, 16 September 2011, www.foreignpolicy.com/2011/09/16/south-china-sea-rising-tensions-but-no-permanent-solutions-on-the-horizon. Lee and Horner, 2. Wood, 12. Chen Shaofeng, “China’s Self-Extrication from the ‘Malacca Dilemma’ and Implications,” International Journal of Chinese Studies, vol. 1, no. 1, (January 2010), 3.
9. Richard Rousseau.
10. Vivan Sharan and Nicole Thiher, Oil Supply Routes in the Asia Pacific: China’s Strategic Calculations (New Delhi: Observer Research Foundation, 2011), 6.
11. David Brewster, “Looking beyond the String of Pearls: Indian Ocean is where India holds a clear advantage over China,” India Today Mobile, 16 May 2013, 1, http://m.indiatoday.in//story/indian-ocean-india-china-strategic-rivalry-tensions/1/271324.ht.
12. William Komiss and LaVar Huntzinger, The Economic Implications of Disruptions to Maritime Oil Chokepoints (Alexandria, VA: Center for Naval Analyses, CRM D0024669 A1/Final, March 2011), 19.
13. Sharan and Thiher, 12–13.
14. Zhang Yuliang with Yu Shusheng and Zhou Xiaopeng, editors, The Science of Campaigns (Beijing: National Defense University, 2006),CPP 20080530715020 China-OSC Summary in Chinese, 29 May 2008, 603−09; 617−25.
15. Ibid., 617−18.
16. Geoffrey Till, “A Changing focus for the Protection of Shipping,” in The Strategic Importance of Seaborne Trade and Shipping (Canberra, Australia: Sea Power Center, Papers in Australian Maritime Affairs, No. 10.2002), 11−12.
17. Ibid., 14.
18. Owen Cote and Harvey Sapolsky, Antisubmarine Warfare after the Cold War (Lexington, MA: MIT Security Studies Conference Series: ASW Conference Report, 1997), 10, http://web.mit.edu/ssp/publications/conf_series/ASW/ASW_Report.html.
19. Margaret MacMillan, The War That Ended Peace: The Road to 1914 (New York, NY: Random House, 2013), 288.
20. Leslie H. Gelb and Dimitri K. Simes, “Beware Collusion of China, Russia,” The National Interest, (July-August 2013), 8.
21. MacMillan, 289.
22. Norman Angell, The Great Illusion (New York, NY: Cosimo Classics, 2007, originally published in 1909), viii.
23. Angell, ix.
24. Angell, 29.
25. Angell, 33.
Seaborne Imports
• As the world’s biggest oil importer, in 2013 China’s net oil imports averaged 6.2 million barrels per day.1
• China looks primarily to the Persian Gulf, Central Asia, and Africa to satisfy its growing demand for oil. Its largest suppliers of crude oil are Saudi Arabia, Angola, and Russia, but their share of China’s total oil imports fell from 44 percent in 2012 to 42 percent in 2013. At the same time China increased oil imports from Iraq and Republic of Congo.2
• Australia and Indonesia are China’s largest suppliers of liquefied natural gas.
• In 2012, China consumed one quarter of the world’s copper and one fifth of the world’s aluminum.3
• China imports about four-fifths of its demand in soybeans, or about 60 percent of the world’s soybean production.4
By 2030:
• About three-fourths of China’s oil will come from overseas markets.
• Its import of natural gas will reach about 30 percent of total consumption.5
According to the United Nations:
• In 2012 China’s approximate share of the world’s imports of coal was 17 percent, iron ore 65 percent, steel production 46 percent, and nickel ore 34 percent.
• Between 2002 and 2012 it accounted for most of the world’s bauxite trade.
• In 2013, China was the sixth largest importer of wheat and coarse grain.6
1. U.S. Energy Information Administration (EIA), “China,” 4, last updated 4 February 2014, www.eia.gov/countries/cab.cfm?fips=ch.
2. Office of the Secretary of Defense, Military and Security Developments Involving the People’s Republic of China 2011 (Washington, DC: Department of Defense, Annual Report to Congress, 2011), 20. Wayne Ma and Brian Spegele, “New Suppliers Boost China Oil Imports. China’s imports From Iraq Rose roughly 50 percent Last Year,” Wall Street Journal, 21 January 2014, 1, http://online.wsj.com/news/articles/SB10001424052702303802904579334411874909686.
3. Michael D. Wood, Chinese Maritime Power—Is the Increase in China’s maritime power internally consistent with China’s national interests and foreign policy, or cause for concern? (Kingston, Ontario: Royal College of Defence Studies, July 2012).
4. Nicholas Thomas, “Going out: China’s food security form Southeast Asia,” The Pacific Review, vol. 26, no. 5 (December 2013), 531.
5. Chen Shaofenga, “Has China Foreign Energy Quest Enhanced Its Energy Security?” The China Quarterly, 22 September 2011, 3; accessed at the U.S. Naval War College site S:\MARSTAT News Summary\China\Energy_Other\Has Chinas Foreign Energy Q.
6. United Nations Conference on Trade and Development (UNCTAD), Review of Maritime Transport 2013 (Geneva: UNCTAD, United Nations Publication, 2013).