US-China tensions rise after Beijing launches missiles into the South China Sea

U.S.-China tensions over the South China Sea escalated on Wednesday, with Beijing firing four missiles into the waters around the same time as the Trump administration took action against Chinese companies that helped set up outposts in the disputed region.

China launched four medium-range ballistic missiles into the South China Sea on Wednesday amid broader military exercises by the People’s Liberation Army, according to a U.S. defense official who asked not to be identified. The missiles landed in the sea in an area between Hainan Island and the Paracel Islands, the official said, and were fired a day after Beijing protested a flyover by a U.S. spy plane.

“As long as they’re doing it in accordance with international law and norms they have every right to do so," Scott D. Conn, a U.S. navy vice admiral, told reporters on Thursday in response to a question about the missile tests. He said the U.S. is ready to respond to any threats in the region, and said if all militaries operate professionally “you can have the same ships in the same water space."

U.S. Defense Secretary Mark Esper, addressing the Daniel K. Inouye Asia-Pacific Center for Security Studies in Hawaii, called the Indo-Pacific the “epicenter of great power competition with China" and said Beijing had repeatedly fallen short on promises, including abiding by international law.

Separately on Wednesday, the U.S. announced trade and visa restrictions on 24 companies for their efforts to help China “reclaim and militarize disputed outposts" in the contested maritime area, according to a statement from the U.S. Department of Commerce. The most prominent were units of state-owned China Communications Construction Co., one of the largest builders of projects in President Xi Jinping’s “Belt and Road" initiative, which saw its shares slide as much as 5.6% on Thursday in Hong Kong.

The escalating tensions come as the Trump administration is trying to push back against what the U.S. sees as an intensifying Chinese campaign to dominate the resource-rich South China Sea and smaller nations in the region. Last month it explicitly rejected China’s expansive maritime claims in the region for the first time, and sent aircraft carriers to the waters to conduct military exercises.