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Beijing Offers to Negotiate in South China Sea Dispute By JEREMY PAGE and CHUN HAN WONG in The Wall St Journal, July 13, 2016

BEIJING—China sought to refocus a dispute over the South China Sea on sovereignty over land, rather than historic rights to surrounding waters, after an unfavorable ruling by an international tribunal.

In a detailed response to the verdict in a landmark case brought by the Philippines, China’s cabinet issued a policy paper describing all land features in the area as its “inherent territory” and accusing Manila of illegally occupying some of them.

China Vice Foreign Minister Liu Zhenmin, who introduced the paper, also stepped up a barrage of official Chinese invective against the tribunal, accusing its five arbitrators of being biased, ignorant of Asian culture, and working for the Philippine government.

But Mr. Liu added that China remained committed to negotiations with the new Philippine president, Rodrigo Duterte, and other governments with competing claims.

Beijing’s pairing of harsh rhetoric with offers of talks suggested that while still determined not to comply with the ruling and sensitive to the demands of a nationalistic public, it was wary of escalating a dispute that has already driven some of its neighbors to forge closer defense ties with the U.S.

There was no immediate response to China’s statements Wednesday from Manila or the Permanent Court of Arbitration. The court’s tribunal on Tuesday rejected China’s claim to waters within a nine-dash line that Beijing depicts on maps as extending almost to Malaysian Borneo, and to exclusive economic rights around the Spratly Islands.

China has vowed not to comply with the ruling.

However, there were some signs in the new policy paper that China was seeking to clarify its legal claims, possibly to lay the ground for negotiations with the Philippines and other governments.

“The good news is that China is moving towards clarification and reduction of ambiguity,” said Yanmei Xie, senior China analyst at the International Crisis Group. “The bad news is that clarification could also bring calcification of China’s position.”

The policy paper spelled out that China claimed sovereignty over all of the Spratlys, the Paracel Islands and two other clusters of islands, rocks and reefs in the South China Sea.

Those claims are broadly compatible with the treaty on which the tribunal was based—the U.N. Convention on the Law of the Sea, or Unclos—as it doesn’t determine sovereignty over land, only rights in surrounding waters.

“[President] Xi Jinping seems to be doubling down on the island sovereignty claim,” said Andrew Chubb, an expert on China’s maritime disputes at the University of Western Australia. “By emphasizing that they are not backing down on sovereignty, it gives them some cover to quietly back away from some of the other implied claims” that would have been incompatible with Unclos.

Still, vague language in the policy paper raised fresh questions about China’s claims.

The paper made no mention of the nine-dash line but said all “the South China Sea islands” China claims have maritime rights allowed by Unclos—including 12-nautical-mile territorial seas and an exclusive economic zone.

However, it defined “the South China Sea islands” as including uninhabited reefs and rocks that don’t qualify for an EEZ under Unclos. It was also unclear whether that meant China claims one all-encompassing EEZ, which would be hard to justify under Unclos.

“In addition, China has historic rights in the South China Sea,” the paper added, without defining those rights. Unclos allows countries to claim “traditional fishing rights” in others’ territorial waters.

Across the board, Chinese officials struck a note of defiance in the wake of the verdict and depicted China as the victim of a conspiracy orchestrated by the U.S. and its treaty ally, the Philippines.

Cui Tiankai, China’s ambassador to the U.S., in a speech in Washington on Tuesday, accused the tribunal of “professional incompetence” and “questionable integrity” and said the ruling “will certainly intensify conflict and even confrontation.” Mr. Liu, the vice foreign minister, assailed the tribunal’s composition, saying the five arbitrators—four from Europe and one from Ghana—were unfit to pass an impartial ruling. “Do they understand Asian culture?” Mr. Liu said. “Do they understand Asia’s complex geopolitics?”

He directed blame for regional strains toward the U.S., saying tensions had begun around the same time that the administration of President Barack Obama launched its “rebalancing” strategy to focus more military and other resources on the Asia Pacific region.

China’s muscle flexing over its national interests has already driven some neighbors away, including ones who have courted warmer ties with Beijing.

South Korea, whose president, Park Geun-hye, made a strategic bet on ramping up economic links with China since she took office in 2013, decided last week over Beijing’s objections to let the U.S. place an antiballistic missile system on its territory, a sign of Seoul’s frustration with Chinese policies on North Korea’s nuclear-weapons program.

Vietnam, a rival to China’s territorial claims, has also honed closer ties with Japan and the U.S. after Beijing deployed an oil rig in disputed waters off its coast in 2014. http://www.wsj.com/articles/china-tries-to-refocus-south-china-sea-dispute-on-rocks-and-reefs-1468396989

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