The South China Sea dispute is a proxy for the broader strategic rivalry between the United States and China to a significant extent, serving as a key arena where both powers project their influence, test military capabilities, and compete for regional dominance.

For the U.S., the dispute is about upholding international law, particularly the freedom of navigation, and protecting its allies and partners.

For China, asserting its expansive claims is a way to solidify its position as the dominant regional power and challenge the U.S.-led international order.

The Dispute as a Proxy for Great Power Rivalry-

The South China Sea dispute is not solely about territorial claims; it's a microcosm of the larger geopolitical competition between Washington and Beijing.

• Freedom of Navigation vs. Territorial Sovereignty: The U.S. frames its involvement as a defense of a rules-based international order and the principle of freedom of navigation in a vital waterway. U.S. naval exercises and "Freedom of Navigation Operations" are intended to challenge China's excessive claims and military buildup on artificial islands. China, in contrast, views these U.S. actions as a violation of its sovereignty and a means of containing its rise.

• Military Buildup: China has built and militarized artificial islands, installing runways, ports, and military outposts. The U.S. has responded by strengthening its military presence, holding joint military exercises with regional allies, and providing them with military assistance. This creates a security dilemma, where each side's defensive actions are perceived as offensive by the other, escalating tensions.

• Alliances and Influence: The dispute is also a battle for influence. The U.S. is revitalizing alliances with countries like the Philippines and Australia to form a more unified front against China's assertiveness. Meanwhile, China uses its immense economic power to exert pressure on smaller nations, often offering lucrative trade deals and infrastructure projects to discourage them from aligning with the U.S.

How Smaller Nations Manage the Tension-

Smaller nations like the Philippines and Vietnam are managing this tension through a hedging strategy, seeking to balance their security interests with their economic ties. They are caught in a difficult position, as they rely on the U.S. for security but depend on China for trade and investment.

• Philippines' Balancing Act: The Philippines has a mutual defense treaty with the U.S., which it has been leveraging more actively in recent years. After a period of strained relations with Washington under a previous administration, President Marcos Jr. has moved to strengthen ties with the U.S., allowing for increased military access and joint patrols in the South China Sea. At the same time, Manila continues to engage with Beijing on diplomatic and economic fronts, seeking to de-escalate tensions and secure Chinese investment.

• Vietnam's Pragmatic Approach: Vietnam's approach is more subtle. It has historically had strained relations with China and is a claimant to territories in the South China Sea. Hanoi has been actively modernizing its military and has signed maritime security deals with the Philippines. However, Vietnam also shares a communist government with China and maintains close economic ties with its larger neighbor. Therefore, Vietnam tends to avoid publicly and directly confronting China, instead preferring to pursue a strategy of private diplomacy and quiet deterrence to manage tensions.

• Regional Cooperation: Both the Philippines and Vietnam are members of the Association of Southeast Asian Nations (ASEAN). While the bloc has been challenged by internal divisions, they use this platform to pursue a regional approach to the dispute, advocating for a Code of Conduct with China. However, progress on this front has been slow, often due to China's reluctance to agree to a legally binding framework.