The South China Sea remains a focal point of geopolitical tension, marked by escalating confrontation, continued militarization, and a complex rivalry between China and the United States. While some limited progress was made in 2025 toward a Code of Conduct (COC) between the Association of Southeast Asian Nations (ASEAN) and China, the path forward remains fraught with challenges as negotiations continue into 2026. The delicate balance of power in the region is further complicated by the actions of littoral states asserting their maritime rights and the increasing involvement of external actors.
Throughout 2025, a pattern of action and reaction defined the interactions between China and neighboring countries with claims in the South China Sea. Coastal states attempting to exercise their rights to freedom of navigation and jurisdiction within their exclusive economic zones faced increasing verbal and physical harassment from the China Coast Guard (CCG). This assertive behavior underscores China’s determination to solidify its control over the contested waters.
Increased CCG Presence and Confrontations
The CCG significantly increased its presence in key areas of contention. According to reports, the CCG doubled its patrols around Scarborough Shoal and nearly tripled those around Sabina Shoal. In October, CCG vessels were involved in aggressive incidents with Filipino fishing boats, employing high-pressure water cannons and even ramming vessels near Thitu Island and Sabina Shoal. Beyond the Philippines, the CCG continued to monitor oil and gas activities around Vanguard Bank, interfered with Vietnamese fishing boats near the Paracel Islands, and harassed drilling operations off the coasts of Sarawak and Indonesia’s North Natuna Sea.
Militarization Efforts Intensify
Alongside the CCG’s assertive actions, militarization of the South China Sea continued to accelerate. Vietnam has been actively building infrastructure on 21 features in the Spratly Islands, enhancing its logistical capabilities and defense posture. This includes the construction of military barracks, munitions storage facilities, and docks capable of accommodating Gepard-class missile frigates, as well as a 3.2-kilometer runway on Barque Canada Reef. Hanoi’s efforts reflect a strategic move to strengthen its presence in the region before a final COC is agreed upon.
China has also been expanding its military footprint, initiating dredging and landfill activities at Antelope Reef in the Crescent Group of the Paracel Islands in October. Military analysts speculate that this expansion aims to bolster China’s ability to disrupt U.S. Intelligence gathering and military operations, particularly in the event of a contingency involving Taiwan.
Great Power Competition and Alliances
The South China Sea remains a key theater in the strategic competition between China and the United States. The U.S. National Security Strategy, released in November 2025, underscored the importance of the Indo-Pacific region and emphasized the need to function with allies to deter Chinese aggression.
U.S. Military engagement with the Philippines has increased significantly, with a focus on maritime cooperative activities. This included one bilateral exercise and seven multilateral exercises. In April, the U.S. Deployed NMESIS coastal defense missiles during Exercise Balikatan. In October, the two countries co-led Exercise Sama-Sama, involving participants from Australia, Canada, France, Japan, Italy, Latest Zealand, and the United Kingdom. The U.S. Navy also conducted two freedom of navigation operations and deployed four carrier strike groups for routine patrols.
In response to the increased U.S. Presence, the People’s Liberation Army Navy (PLAN) deployed its aircraft carriers – Liaoning and Shandong in June, and Fujian in September – to the South China Sea, demonstrating its growing naval capabilities. A live-fire exercise was conducted near Scarborough Shoal in October, coinciding with Exercise Sama-Sama.
Progress and Challenges in COC Negotiations
Despite the tensions, 2025 saw some progress in negotiations toward an ASEAN-China Code of Conduct. As ASEAN Chair, Malaysia convened five meetings of the ASEAN-China Joint Working Group, stepping up the pace of discussions. By the end of the year, Malaysia’s foreign minister announced that approximately 70 percent of the COC’s content had been agreed upon. Though, significant disagreements remain regarding geographic scope, legal status, self-restraint measures, and the role of external powers.
Looking ahead, China is expected to leverage U.S. Military commitments in the Middle East to further assert its claims in the South China Sea, potentially continuing regular deployments of carrier strike groups. China is also likely to maintain its action-reaction approach to any activities by the Philippines that challenge its territorial claims. A worst-case scenario could involve an accidental escalation leading to loss of life, potentially triggering the Philippines to invoke Article Four of its Mutual Defense Treaty with the United States.
Vietnam is anticipated to complete its infrastructure development program in the Spratly Islands in 2026, increasing the presence of both civilians and naval infantry, which could lead to further challenges from China. As the 2026 ASEAN Chair, the Philippines is expected to prioritize concluding a COC before the end of the year, but negotiations will be difficult. Manila is unlikely to accept a weak or non-binding agreement that would entrench China’s presence, while Beijing is unlikely to agree to a legally binding agreement that restricts its coastal guard activities. The Trump administration’s stance against restrictions on U.S. Operations in the South China Sea also adds another layer of complexity.
The intensifying rivalry between the U.S. And China further complicates the situation. The Philippines is continuing to modernize its armed forces and strengthen its alliance with the United States, while Washington has made clear its commitment to defending the first island chain. Joint U.S.-Philippine maritime exercises with allies are expected to continue.
further progress toward a comprehensive and effective ASEAN-China Code of Conduct remains uncertain. The situation in the South China Sea will continue to demand careful diplomacy and a commitment to maintaining stability in the region.
The next key development to watch will be the outcome of the ongoing COC negotiations as the Philippines assumes the ASEAN chairmanship in 2026. The ability of all parties to address the remaining contentious issues will be crucial in determining whether a meaningful agreement can be reached.
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