Philippines in the South China Sea. But Beijing is still vent on claiming the

waters for itself. Why the obsession and what's the strategic

value of the area? Our Kim Jung-soo breaks it down for us.

The South China Sea refers to a three-point-five million square kilometers area in the Pacific

Ocean where mainly six nations, which are China, Philippines, Taiwan, Vietnam, Malaysia

and Brunei, share and claim territorial rights.

The most recent dispute between China and the Philippines was mediated a day ago by

an international tribune in the Hague, which ruled in favor of Manila, but Beijing claims

Chinese presence in the sea dates back to the 3rd century BC.

In 2013, the Philippines took China to court demanding its right to exploit the territorial

seas that are part of the South China Sea, but Beijing refused to participate, and responded

by increasing the number of military drills in the disputed area.

In 2014, China further alarmed its neighbors by enlarging artificial reefs on the Spratly

Islands, and therefore attempted to create "exclusive economic zones," which allow countries

uncontested sovereignty of territorial seas within 200-miles from the coastline.

But the reluctance to compromise on where each nation's territorial seas start or end

is primarily motivated by a number of economic factors.

According to the Council on Foreign Relations, about half of international maritime trade

routes pass through the South China Sea,

amounting to an annual 5.3 trillion U.S. dollars worth of commerce, while more than 60 percent

of oil-tankers transit through the area. 23 billion tons, or 13 percent of the planet's

crude oil, are estimated to be buried deep under the sea as well, along with more than

5 trillion cubic meters of natural gas.

In other words, the South China Sea represents a vast fortune in resources, and regional

power for the nation that claims the sea for itself.

With China refusing to accept the ruling announced on Tuesday, experts say that neighboring countries

must closely monitor Beijing's reaction in the months to come. In particular, experts

advise that new Philippines President Rodrigo Duterte must strive to avoid direct confrontation

with China and foster a flexible economic relationship.

Kim Jung-soo, Arirang News.