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			 China has stepped up activity to assert its claim to most of the 
			energy-rich South China Sea. 
 But Brunei, Malaysia, the Philippines, Vietnam and Taiwan also have 
			claims over parts of the sea through which about $5 trillion of 
			ship-borne goods pass every year.
 
 China's activity has in particular raised alarm in the Philippines 
			and in Vietnam, where a dispute over an offshore drilling rig 
			sparked deadly anti-Chinese riots last week.
 
 China and the 10-member Association of South East Asian Nations 
			(ASEAN) signed an agreement in 2002 to refrain from occupying 
			uninhabited reefs and shoals in the sea, and from building new 
			structures that would complicate disputes.
 
 "In our view, what they are doing there now is in violation of what 
			we had agreed in the Declaration of Conduct of Parties in the South 
			China Sea," Aquino told reporters.
 
			
			 "The problem is this code is not binding, not enforceable, so we 
			need to come up with a formal code of conduct to resolve the dispute 
			and prevent any potential conflict."
 
 Last week, the Philippine foreign ministry released surveillance 
			photographs of China's reclamation work in Johnson South Reef in the 
			disputed Spratly Islands. China appears to be building an airstrip, 
			its first in the Spratlys.
 
 Peter Paul Galvez, a Philippine Defense Department spokesman, said 
			the military noticed the reclamation work early this year. A Chinese 
			airstrip in the area could pose a serious threat to security and 
			stability in the region, he said.
 
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			China has rejected the Philippine protest over its work on the reef 
			saying it is its territory so China has the right to develop it.
 Elsewhere in the South China Sea, Vietnamese and Chinese vessels are 
			squaring off in disputed waters where China wants to place the oil 
			rig.
 
 China and ASEAN, which includes the Philippines and Vietnam, have 
			been negotiating a formal code of conduct but some ASEAN states are 
			getting impatient with the slow pace of progress.
 
 Aquino said Vietnam and the Philippines were pushing for the code of 
			conduct to be concluded quickly.
 
 (Editing by Robert Birsel)
 
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