An international tribunal ruling against Beijing's extensive claims in the South China Sea is the Asian giant's biggest diplomatic setback in years, leaving it facing a difficult choice between pragmatism and nationalism, analysts say.

Beijing has unleashed a deluge of vitriol against the ruling by the Permanent Court of Arbitration in The Hague, but at the same time the permanent UN Security Council member is trying to position itself as a key player in the global community.

Beijing's claims to almost the whole of the strategically vital South China Sea are embodied in a nine-dash line dating from 1940s maps, and it has built up a series of artificial islands capable of supporting military operations.

But when the Philippines, a rival claimant, asked the UN-backed tribunal to rule on 15 issues relating to the dispute, it ruled there was no legal foundation for China's ambitions to control the area's bounty.
The announcement unleashed a flood of condemnation from the Chinese government and state media, which for months had been preparing for an unfavourable outcome with attacks on the tribunal's integrity, calling the group everything from a "fraud" to a "mutant."

Angry Chinese citizens vented their spleen online but authorities reportedly censored the most aggressive comments, and imposed tight security around the Philippine embassy amid fears of protests.

Beijing reiterated its right to declare an air defence identification zone in the area Wednesday, but did not explicitly threaten action in the water.

Its wrath was undercut by the fact that by boycotting the proceedings, insisting that the tribunal had no jurisdiction, Beijing had repeatedly rejected the opportunity to defend its position, analysts said.
Yanmei Xie, a China analyst for the International Crisis Group, said its ambitions for a bigger place on the global diplomatic stage put it in a quandary. 

"China is at a point where it wants to participate more in the shaping of international institutions and in some cases has taken up a role as a leader," she told AFP.

Last year China set up a new multilateral lender, the Asian Infrastructure Investment Bank, in September it will host the annual G20 summit, and it contributes more blue helmets to UN peacekeeping missions than any other country in the world.

But its hard won credibility could be at stake if it is seen as setting itself  "against international law and international institutions" or "cherry picking" rules for its own convenience, she said.

- 'True test' -

China's ruling Communist Party has long used nationalism to bolster its legitimacy, but the rhetoric has escalated under President Xi Jinping, who has responded to weakened economic growth with calls to resist the kind of pernicious Western influences that led to the country's exploitation and weakness in the 19th century. 
At the same time it has also asserted its territorial claims more aggressively, with Xi regularly exhorting the military to improve its ability to win battles.

"This really will be the first true test of Xi Jinping's leadership because he's ridden the tiger of nationalist sentiment and wrapped himself in the flag I think very successfully," said Euan Graham, of Australia's Lowy Institute think tank.

But at the same time, "China does take its membership of the United Nations and the Security Council very seriously," he said, adding "it's not easy to reject an approved tribunal that is drawing on a United Nations treaty".

Jay Batongbacal, a maritime affairs expert at the University of the Philippines, said the judgement was "a foreign policy disaster for the Party".
"It's going to take a lot of great statesmanship to move China from its very hardline public position without looking like it's conceding," he told AFP.

Although China's foreign ministry issued a hardline response to the ruling, full of denunciations, it also offered an olive branch. The country is "ready to make every effort with the states directly concerned to enter into provisional arrangements of a practical nature", it said at the end of a lengthy statement reasserting its claims of sovereignty.

Beijing has warned that it will meet force with force if necessary, but Hu Xingdou, a foreign policy expert at Beijing University of Technology, said a military reaction to the ruling was unlikely.

"It would lead to the interruption of China's modernisation and lead China to become more and more closed," he said.

Ultimately, he said, China's response "must not be too exaggerated, and must not be too outraged".

Source: AFP