On June 2, 2016, the Japanese government lodged an official complaint with the Chinese Embassy in Tokyo over the discovery of two new drilling rigs being constructed near the disputed zone of the East China Sea. Although reports and pictures of the new drill platforms provided by the Japanese government do not identify which Chinese companies are responsible for these projects, it is likely ‘‘‘ based on precedential evidence in the East and South China Seas ‘‘‘ that China National Offshore Oil Corporation (CNOOC) and possibly China Oilfield Services are involved. IntelTrak identifies eighteen Chinese companies that have been active in the South China Sea and East China Sea.
This discovery came one day before the commencement of Asia‘s largest defense summit, the Shangri-La Dialogue. During discussions at this summit, Chinese officials repeatedly stated their intention to ignore any ruling by the Permanent Court of Arbitration in the Hague regarding China’s claims in the South China Sea that overlap with those made by the Philippines. Specifically, the court will be ruling on the legality of China basing its territorial claims on the ‘‘‘nine-dash line.‘
Beijing’s use of state-owned enterprises to carry out its provocative acts in the East and South China Seas is a neglected vulnerability and risk that is likely to come into greater focus in the period ahead.