Multimillion-dollar undersea/subsea fiber optic cable projects have become the latest focal point of geopolitical tensions in Asia as China intensifies its highly contested claims over the South China Sea, writes Nikkei Asia’s Singapore correspondent Tsubasa Suruga. These cables are crucial for keeping information flowing throughout the region and across the Pacific. Most countries require builders to get approval if they plan to lay cables in their territorial waters, but not in their exclusive economic zones, which extend 200 nautical miles out from a country’s coast.
China, however, insists that projects within its self-proclaimed “nine-dash line” — an area encompassing virtually the entire South China Sea — need Beijing’s approval. A nonobjection letter must be obtained from China’s People’s Liberation Army before the formal application process can even begin. Beijing imposes the policy even though an international tribunal found in 2016 that the nine-dash line lacked a legal basis.
“It is no secret the whole industry is more confronted by politics,” said Takahisa Ohta, senior director of the submarine network division at NEC, one of the world’s top three suppliers of subsea cables. Some of the companies involved, like Singtel, are looking for ways to diversify their routes.
Tay Yang Hwee, a 30-year industry veteran who heads subsea cable development at the Singaporean telecom provider, said it is “exploring alternate paths” for connecting data hubs, but he admits it is “very difficult” to avoid the South China Sea as a whole.
The Singapore-to-France cable would have been HMN Tech’s biggest such project to date, cementing it as the world’s fastest-rising subsea cable builder, and extending the global reach of the three Chinese telecom firms that had intended to invest in it.
But the U.S. government, concerned about the potential for Chinese spying on these sensitive communications cables, ran a successful campaign to flip the contract to SubCom through incentives and pressure on consortium members. It’s one of at least six private undersea cable deals in the Asia-Pacific region over the past four years where the U.S. government either intervened to keep HMN Tech from winning that business, or forced the rerouting or abandonment of cables that would have directly linked U.S. and Chinese territories.
SubCom had no comment on the SeaMeWe-6 battle, and HMN Tech did not respond to requests for comment. In a statement last year about infrastructure projects, the White House briefly noted that the U.S. government helped SubCom to win the Singapore-to-France cable contract, without giving details. China’s foreign ministry did not respond to requests for comment. China Telecom, China Mobile, China Unicom and Orange did not respond to requests for comment. Microsoft declined to comment.
Undersea cables are central to U.S.-China technology competition. Across the globe, there are more than 400 cables running along the seafloor, carrying over 95% of all international internet traffic, according to TeleGeography, a Washington-based telecommunications research firm. These data conduits, which transmit everything from emails and banking transactions to military secrets, are vulnerable to sabotage attacks and espionage, a U.S. government official and two security analysts told Reuters.
The potential for undersea cables to be drawn into a conflict between China and self-ruled Taiwan was thrown into sharp relief last month. Two communications cables were cut that connected Taiwan with its Matsu islands, which sit close to the Chinese coast. The islands’ 14,000 residents were disconnected from the internet.
Taiwanese authorities said they suspected a Chinese fishing vessel and a Chinese freighter caused the disruption. However, they stopped short of calling it a deliberate act and said there was no direct evidence showing the Chinese ships were to blame. China, which considers Taiwan a breakaway province, has ratcheted up military and political efforts to force the island to accept its dominion.