also, we shared our concerns on east china sea and south china sea situation. we will deepen our defense cooperation and securing the peace and stability in east china sea as well as engaging nations in the south china sea. in order to secure seamless response in the alliance in any situation, we must constantly continue our efforts to strengthen the alliance. through today's discussion, we were able to seek specific direction for future efforts. moving forward, we will accelerate the implementation of further guidelines and move in cooperation under the peace and security legislation. we will expand peace and cooperation, such as surveillance and joint training. furthermore, we will continue to promote cooperation in ballistic missile defense, including acquisition [indiscernible] and enhanced ability domain, such as cyberspace. we plan to strengthen further our joint response posture. along with this, in order to strengthen our own defense capability, we intend to review the national defense program and also work on the new midterm defense program. this was e

we also discussed our concern about the security environment in the east china sea and south china sea. the united states and japan oppose any unilateral action that seeks to undermine japan's administration of the islands and we reaffirm article five of the u.s.-japan security treaty that covers these islands. we also oppose militarization activity in the south china sea. maritime disputes should be settled peacefully and maintain the freedom of navigation in accordance with the united nations conventions on the law of the sea. we maintain our unwavering commitment to the 2015 guidelines for u.s.-japan defense cooperation and we have instructed our staff to accelerate their implementation. we also will explore new and expanded activities and intelligence, surveillance, and reconnaissance, training and exercises, research and development, capacity building and joint and shared use of facilities. we discussed our deterrence to ensure the security and stability of japan and the asia-pacific region. we plan deep engagement through our extended deterrence and dialogue. both the united stat

china has what they regard as historical claim to the south china sea. it would be roughly as though the united states claimed to own the gulf of mexico. china's belief is that their ancient territorial right is the result of all of those voyages of admiral and as a result they own that water space, 80% of pacific trade passes through the south china sea and to reinforce this claim, china is building artificial islands and reefs, many of them, thousands of acres and they're militarizing, each one of those islands becomes a kind of aircraft carrier from which china seeks to operate and it reinforces their claims under international law. fortunately we have allies in the region, we have japan, which is increasing its military spending and is more incline to operate along side us, we have south korea, booming economy, new president, our allies are the heart of our merit time strategy in the region and it's good that we have them because we have an enormous tactual problem. china is a strategic challenge. the tactical problem is right here. it's north korea.

we have won oui’ china sea? absolutely not. case in the arbitration court but, as president rodrigo duterte rodrigo said, we will take theseissues duterte rodrigo said, we will take these issues up sometime in the administration but at this point it is important to build confidence in each other. before we tackle the difficult issues that are posed in the south china sea. we are not abandoning any claims but we think, the president thinks, this is time to be more friendly rather than contentious. china is growth is slowing down and the ruck and turns ofa slowing down and the ruck and turns of a debt bubble. many countries who have taken of a debt bubble. many countries who have ta ken loa ns of a debt bubble. many countries who have taken loans from there are now worried of being in debt to china. is the philippines in this position? we think chinese loans can be beneficial to us, particularly if we negotiate them in a clever man. , using our national interest is our prime measure as to whether we take the loan or not. nobody i

china has a reason to believe this is their sea. do they really pose such a threat to us that we cannot give them more room to maneuver in south china sea and avoid the confrontation? and seem there that control of that area like most of the world exceeds our control in caribbean. >> first of all i would say that mexico, cuba, jamaica, trinidad, et cetera in no way control the caribbean. what china is attempting to do to follow your analogy would be to actually take territorial control to make that a territorial sea. so i think the analogy breaks down a bit because of the expansioniveness of the chinese desire here. i think it's fair to say and i would agree with you that it is reasonable for us to e believe that china ought to have significant influence in asia. significant influence in asia. that makes sense. but we should not exceed to simply territorial control over an enormous body of water that would be an enormously bad precedent. i think that historic analogy that's actually more apt that -- you kind of pulled at was the con

also concerns about china and its claims to the south china sea. calm in this situation. in terms of its own defence mechanism and what is looking for. japan is rightly concerned. japan is on the side of the us. you would expect them to be together, pushing for a diplomatic solution. japan is being much, in its language than america is. but undoubtedly somebody, and i suspect it is someone not in the region, will have to emerge as a peacemaker to the regional crisis that is emerging, with china, japan, us and north korea — who that will be we have yet to see. it could play out in two ways, couldn't it, where we see this situation with north korea, the us and with china in its role possibly solving some issues, or making them worse, like the south china sea. this is the problem - there is no sign of china moving quickly i would say to resolve the situation, it is in their own interest that they keep the sides talking longer, it is in their own interest that they try to find territorial gain in the region, sol am not convinced china can be the answer

i'm still concerned about the south china sea and potentially the east china sea. yeti think we have not particularly in recent months figured out how front and center we will put that issue in a bilateral relationship. north korea, as important as that is, cannot overshadow our attention to that issue. would beea -- steve i interested to see how you would play out the scenario of ending up in conflict with direct results -- i do think that what verysk is our understandable frustration with the failure to address the problem sufficiently leading to miscalculations on our side or the part of the north koreans or our allies such that we end up on a slippery slope. we can spend more time on north korea but, those of the two issues, north korea and the south china sea where the inpetition could end up worst case, resulting in confrontation. >> thank you. i imagine someone will ask about north korea. -- last words on the china and north korea relationship? >> the china relationship has to be nested in overall u.s. policy. connie said it right earlier. few nations on the

the south china sea issue, for example. at times president duterte has distanced himself from the united states and really said he doesn't need the type of security arrangement that we have now. >> he has. you know, it's been a challenge, i think, in the south china sea trying to figure out how to calibrate the relationship with the philippines over the last year. at times, president duterte has seemed like he, obviously, wants to take a much more conciliatory approach towards china. most recently he's discussed things like joint exploration again, in some of the areas like reid bank. but he faces domestic challenges at home facing a-- you have seen parts of the philippine congress, as well as parts of the philippine government, including the ministry of defense really saying they're not okay with that approach. and he's had to walk that back at times. so he's trying to tow a fine line between wanting to be more open with china but recognizing at the same time a lot of people in the fill feens pooens have real concerns abou

i am quite concerned about the south china sea and potentially the east china sea. i think we have not yet, particularly in recent months, figured out how front and center we will put that issue in the bilateral relationship. i think north korea, as important as that is, cannot overshadow our attention on that issue. on north korea steve, i would be , interested in hearing how you play out the scenario of the u.s. and china in direct confrontation over that. i think what we risk is our very understandable frustration with the failure to address the problem sufficiently relating to miscalculations on our side or the part of the north koreans such that we end up on the slippery slope. we can spend more time on north korea, but i think those are the two issues, north korea, south -- china sea where the competition could end up in confrontation. >> i imagine some of his son to -- i imagine someone is going to ask about north korea. tom and condi, last words on the china relationship. >> a couple of things, number one is that the china relationship has to be nested in yo

. >> this is in the diplomatic lane, talking about china, south china sea, freedom of navigation. says the recent u.s. navigation operation harms chinese sovereignty. this is issue and response we've seen before, but do issues of freedom of navigation, some economic issues, do they make for a more difficult campaign on north korea with china? >> freedom of navigation operations happen all around the world. they tend to get the most attention when they happen in the south china sea. they happen off the coast of canada. they happen, in the waters offshore of our major allies, friends, partners, all around the world. that is why we're focusing on it right now. that's why you're asking me of that question because of the issue of dprk as you know secretary tillerson coming back from the asean conference where there was a joint statement issued about the south china sea. we talked about that pretty extensively yesterday. as you all know u.s. forces operate in the asia-pacific region. they do that on daily basis including the south china sea. the operations are conducted within internatio

the south china sea, that china wants the natural resources under the sea. kay, they don't worry about the freedom of passage. and who is going to win, china or america? it all depends on, it all depends on who has upperhand. it all boils down to international relations as who has the upper hand and who has the say. so in a way i'm wondering, okay, that what we discussed today and all the discussion has some at times in different vocations, it will not bear any consequence to the ultimate outcome. thank you. >> anyone on the panel want to tackle that? >> perhaps i will just say that i respectfully do not share your pessimism with regards to the future being, the destiny be outside the head of the taiwanese people. i think that does nevertheless, highlight to build consensus within taiwan, and it taiwan can successfully build consensus, then i think that destiny is from within the grasp of the taiwanese people to be able to present, if i may say, a united front in order to deter and resist chinese, political, economic and military. and so i would say that ther

we talk about the chinese, the south china sea, and other matters as well. >>. >> united nations securityouncil unanimously passed the new u.n. security council. china voted along with that means they have toen for enforcr sanctions. >> i have been suggesting you could have waiting longer to bear fru before threatening fire and fury. how long do you think it will take before we will see more from this? >> we talked yet about the pressure campaign. we had many countries, countries we are close friends with. that is because the world recognizes the severe threat they face. >> the pressure campaign, is it to seek isolation of north korea. they have been invited to attend next year's tor forum. was there a failure to isolate them or futility -- >> my understanding is that the conversations are on going. we are not part of asean. we do not have the ability to extend or rescind an enviation. the nationing all joined us in a pretty condemning statement on the part of the dprk? >> we're going to keep an eye on this state department briefing. president trump has just made a couple comments, one on

between japan and china today with the balance of forces, i would bet on japan. it was just a sea encounter. that won't continue, but over time, currently. and the mutual defense treaty is very strong. so i would say japan is a big player. and one of china's problems and one of the reasons why it's different than in the case of the emergence of the u.s. is that there are strong and powerful other, you know, actors in the region. but as neil said, what this'll end up doing if the athenian/spartan case is the touchstone, is that the relationships with these allies will evolve and adapt and adjust, and the entanglements with the allies can often end up becoming the reason why one thing leads to the other and the two parties end up where they don't want. india, i think, is a wildcard. india, i mean, i'm probably prejudiced about india, because i'm too much influenced by lee kwan yu. we have a great chapter on the future of india. it's a terrific book, but it's not this book. a previous book where it's a great book because 90% of the words in there are lee kwan yu's words. we just do t

so this was happening what close to chinese territory is in this disputed south china sea we'll examine exactly can china do in response to those drills. well i think the first thing that it will do is to simply call attention to this as a provocative act and try to get world opinion to be against the united states to really try to put some pressure on the trump administration to back down a little bit. and in the past it stung this this this is not the first time there's been exercises in that area is not the first time that there's been a dispute between china and the united states about territory in that area either so this is this isn't that part's not novel what is different is what everything else is and that is the growing tensions over north korea the close partner to china and what can be done about that i think china will want to make any moves side of its own free will of its own accord and not do so out of being pressured or intimidated by vericut maybe and i think that. this is this is probably an unnecessary step by the trip administration to get china in line it's not one

talking about china, south china sea, freedom of navigation. china says the recent u.s. harms chinese sovereignty. this is an issue in response to what we've seen before. do issues like freedom of navigation, some economic issues, do they make for a more difficult campaign on north korea with china? >> freedom of navigation operations happen all around the world. they tend to get the most attention when they happen in the south china sea. they happen off the coast of canada. they happen in the waters offshore of our major allies, friends, all around the world. that's why we're focusing on it right now. that's why you're asking me that question because of the issue of dprk. as you know, secretary tillerson coming back from the asean conference where there was a joint statement that was issued about the south china sea. we talked about that pretty extensively yesterday. as you all know, u.s. forces will operate in the asia pacific region. they do that on a daily basis including the south china sea. the operations are conducted in accordance with international law and the p

turn in terms of security for the united states washington sells arms to taiwan patrolling south china sea regularly and much of the cold war for it employment intact and secondly china did do quite a lot quite a bit actually under as a member of the security council imports from north korea down thirteen percent import of coal from north korea down seventy five percent western headlines focused largely on the overall trade volume increasing but that happened largely before the un sanctions kicked in finally present argument was that you know how can china why didn't the china stop trading with the north koreans not using leverage against north korea well that's a physiological flawed argument if china did all trade with north korea. how could beijing's leverage your opinions come from of course of course you know paul can you weigh in on that there because the united states doesn't recognize that north korea in respect of how you feel about the regime in north korea it does have security interests the united states doesn't recognize that it has north korea as a sovereign country a member

they do that on a daily basis including the south china sea.tions are conducted in accordance with international law and the point of that is to demonstrate that the united states will continue to fly, sell, and operate wherever international law allows. it's true in the south china sea, it's true in other places around the world as well. >> in the u.s. deals with china and speaks with china, does it view these issues as compartmentalized or as one big issue? >> we have lots of ongoing conversations. before we dialogue with china, we've had two of the four meetings that are set to take place, such take place later this year. we discuss all kinds of issues. secretary mattis was over here not too long ago having spoken with secretary tillerson and our chinese counterpart about many of these issues. among the issues, we talk about the chinese from the china sea, we also talk about a 15 and other matters as well. >> it doesn't hamper? 's people you know what happened at the united nations. they unanimously passed the new u.n. security council resol

mass search and rescue mission is underway in the south china sea. rob: ten u.s. missing after a navy destroyer collided with an oil tanker and kelly wright joining us with details, kelly. kelly: searching for survivors in the south china sea as the uss john mccain arrives at singapore base with serious damage, ten soldiers are missing and five are hurt after slamming into commercial

a third of the world's merchant tonnage goes through the china sea. china decided to shut it down , that would have dramatic consequences to the united states. so we are going to make sure the sea lanes are open. we are going to make sure our allies are strong. we are going to make sure no country can dominate other countries and be adverse to our interests in doing so. charlie: what do you think the chinese want? jake: ultimately, the chinese would like to be the preeminent power in the asia pacific. their notion of what that looks like is quite different from the american notion. the united states for all of our faults -- charlie: you can also argue they were the preeminent power at some point in the long history of china. jake: yes, but, of course with technology, force projection, economic interdependence what that means today compared with centuries ago is dramatically different. and what chinese dominance in asia looks like compared with american influence in asia is quite stark. you know, the united states had failures and flaws in its foreign

coast guard recently said that the arctic could be the next south china sea and territorial disputes you agree i'm not sure becomes the next south china sea where you have the chinese going up and building islands artificial islands like they're doing in the south china sea the arctic still a pretty even though it's melting it's still a pretty forbidding environment but he is correct in that. they're territorial claims with denmark and greenland with norway with russia with canada with the united states the arctic powers and then also the non arctic powers that want to have the right to pass through the northern passage now that you know climate change is creating a ceiling there and so there are going to be competing claims and when there are competing claims in the maritime spear that draws in coast guards and navies and there's going to and there are a bunch of folks that we shoulder to shoulder in the arctic you know russia claims most of the arctic right they right i don't think they're right look everybody has pretty expansive claims that's what you do and there's never been a

military moves in the south china sea, they dispatch the warship, the uss john mccain to sail past ones artificial islands. the third time the pentagon has conducted one of these "freedom of navigation challenges" 2s claims in that region since president trump took office. what's the message there? >> the message is that we're not going to be as passive as the obama administration was. the problem with the freedom of navigation operations, they're good things to do and we should have been doing them a lot sooner and frequently. it's good that they're doing them. it doesn't change the fact that the chinese bases that they built in the south china sea and militarized, those are not going away, so on the one hand, we are sending messages that we are going to remain present and this is going to be an administration that presses what it considers to be freedom of navigation and the like, but it doesn't change with the chinese are doing and that's actually the same dynamic we have with north korea. despite the presidents rhetoric, the north koreans have basically brushed it off and they have

earlier this month it was involved in an operation in the south china sea concealed within 6 miles of an artificial island built by china. it has damage on the left rear side in trying to get back to a port for safety reasons to assess the damage. they are out there searching for ten sailors were missing. we are getting more details. lucas tomlinson has been following the story. what are you hearing from the department of navy over there at the pentagon. it collided with a cargo ship. photos are being released from the singapore military showing a massive hole in the portside in the rear of the ship. officials coming from the navy fleet, they don't think the damage is as extensive as the fitzgerald earlier. there are still ten u.s. navy sailors missing which is very concerning. a massive search and rescue operation is underway with local resources and uss america which is a large navy assault ship that will have dozens of helicopters taking part in the search operation. singapore is 11 or 12 hours ahead of us. it is daytime right now locally which will help search efforts. >> we are a

china is buying time to implement all of its strategies in the south china sea. s.ad: thanks for that howill be looking at realistic china's hopes are in bringing north korea to the negotiating table. next, how the asian markets have been so far to the strong u.s. job support on friday. this is bloomberg. ♪ rishaad: you are back with "bloomberg markets." haidi: a quick check of the latest business headlines. taking a look at should link commodity house. off the weekg looking a little bit unchanged at the moments. the company making its first comments on the latest. there were no comments last week as they were "destined to fail." they should address the claim or the money and openly. they have responded to earlier allegations and has nothing more to say. toshiba is taking another stab at its u.s. partner saying western digital has no rights to new production that is crucial to both companies. .t concerns a new facility toshiba says it will be built with no input. cutting the company off from new technology. western had a stake in the venture when it bought toshiba

china is moving aggressively in the south and east china's seas. north korea threatens war in the pacific and beyond. the baltic and black see is hazardous as ever, and the islamic state is being pushed partby a war conducted in from ships in the eastern mediterranean. talk about the growing responsibility of the navy here. guest: what is interesting is in the last 25 years, the number of ships in the navy has declined by 20% to our present level of 270. the obama administration had a voting that to 300 and eight -- 308, which is more than today and the from administration wishes to build 25% larger navy that today. smaller --as gotten has gone no smaller in that time. our sense of what to do in the world and what we need to protect and the role the navy plays insecurity and prosperity of this nation as trade has globalized, all of things has created much higher demand in the navy. those are peace time missions. then you look at the threat, the action threat, china and the south china sea, looking to expand its influence further than it has already

top stories, missing sailers in the south china sea.ter for survivors after the navy destroyer collided with an oil tanker. kelly wright with the breaking details. kelly: tough day for the navy. the uss john mccain arrived at naval base in singapore, ten sailers are unaccounted for and five are hurt after the navy destroyer slammed into a commercial tanker east of singapore. you can see a large hole on the side of the ship the u.s. naval ship, the navy reporting significant damage leading to flooding and machinery and communications rooms. president trump responding to the collision on twitter saying, thoughts and prayers are with our u.s. navy sailors aboard the uss john mccain with search and rescues are underway. arizona senator john mccain also tweeting, cindy and i keeping sailers in our prayers tonight. appreciate the work of search and rescue crews. the ship named after senator mccain's father and grandfather, both men received as navy admirals. fourth mishap in the pacific this year, most recently in june uss fitzgerald collided

naval destroyer sailing close to a chinese island in the disputed south china sea the u.s. destroyers actions have violated chinese and international laws as well as severely harmed china's sovereignty and security china will bring up the issue with the u.s. side the u.s. navy destroyer was carrying out a so-called freedom of navigation operation it's the third one conducted during trumps presidency the u.s. says though that there is nothing provocative in this thirty percent of the world's trade goes through the south china sea and the rule such as been in place has been one that is orderly open architecture that's why you know freedom of navigation operations are the least provides good thing that you can conceive of. a spoke earlier to tom brooks professor of law and government at durham university he says that china will not give in to washington's pressure. i think it's definitely provocative clearly an area that china wants to exercise some. control over to some degree or at least have keep or at least keep other military powers out of the region but in light of other

a third of the world's merchant tonnage goes through the south china sea, if china decided to shut that down that would have traumatic consequences for the united states. part of the american naval presence says we will make sure the sea lanes are open, we will make sure that our allies are strong and make sure that no country can dominate other countries and be adverse to our interests in doing so. >> rose: do you think the chinese won. >> i think ultimately the chinese would like to be the preeminent power in the asia-pacific. and their notion of what that looks like is quite different from the american notion. the united states for all of our faults. >> rose: they also can argue they were the preeminent power at some point in the long history of china. >> yes. but of course with technology forced projection, economic interdependence, what that means together compared to centuries ago is quite dramically different. and what chinese dominance in asia looks like compared with american leadership in asia is quite stark. you know, the united states has had flaws and failures in its foreig