Hitherto, the real challenge for China in the South China Sea has been to safeguard its sovereignty. However, for Beijing to cater to its energy demands and domestic economy, it is expected to lessen its dependency upon hard power and rely more on the soft power it possesses.

Why it is important for China to embrace soft power in the SCS? What could be the major components of soft power measures? And lastly, to what extent, this approach will restore confidence among the claimants of the South China Sea?

South China Sea and Beijing's Soft Power
In Beijing’s perspective the effectiveness of soft power vis-à-vis the SCS dispute will depend on, firstly its ability to shape the preferences of other claimants; Secondly, its ability to legitimate Chinese values, culture and policies; and lastly, its capacity to construct rules and norms which limits other’s activities(majorly the United States).

In contrast to China’s reliance upon its military in the region, the PRC possesses advantages of abundant soft power resources. Cultural exchange between China and Africa can be a representative example of how China has been spreading its soft power.  The commitment ranges from health and financial assistance to academic and cultural exchanges. China's expanding soft power might be demonstrated by taking a look at China's economic growth and economic engagement with numerous African nations. China's development of trade and infrastructural investment on the African mainland and the spread of Chinese-led Confucius centres could give a positive impression about China towards individuals in Africa.

In context of Southeast Asia, both China and its neighbours enunciate a broader idea of soft power. China appears to be using soft power to incrementally push Japan, Taiwan and the United states. For instance, China’s aid to Philippines in 2003 and to Indonesia in 2002 was roughly greater than the United States. Beijing has also rebuilt relations with South Asian’s ethnic Chinese organisations, and in nations like Cambodia, a feeder system has been created in which Cambodian student attend Chinese-language school funded from the sources in mainland China. 
 
Similarly, China does not want to take the risk of sacrificing its domestic economy by taking coercive measures. China’s leverage over Southeast Asia includes major economic interest. As late as the 1990s, the US and Japan were major economic partners of Southeast Asia. No longer- China has displaced both to become the major trading partner to the region. With ASEAN-China Free Trade Agreement as a centrepiece, China has negotiated a plethora of economic agreements with the region including an array of infrastructure projects linking Southeast with southern interior China. In addition to free trade agreements with Southeast Asia, Beijing is negotiating closely with individual Southeast Asian states. In order for China to dangle budgetary carrots before the members of the ASEAN it is important to take some steps closer to its peaceful rise.

The Rationale: Quest for Energy Security
China’s demand for oil and gas resources and its drive for energy security are a political challenge of global dimension. The failure to persuade ASEAN states to cooperate on energy security may lead to disastrous consequences. It can only do so by placing mechanisms which allows Sino-ASEAN joint exploration. 

As a country increasingly dependent on oil, China believes the U.S and the major western oil companies wield influence over the world oil market and oil industries. China has earned limited rate of investment (ROI) on its investment in the energy sector in the South China Sea as it has already made headway in the same in the Persian Gulf, Central Asia, Russia, Africa and Latin America. One of the reasons for low ROI is due to the opaqueness in the quantum of resources that the Islands and reefs in the South China Sea has. Secondly, China is squandering time and money by expanding its naval fleet well beyond what is required to protect its coast and sea line of communications. It is wary of foreign oil companies conducting joint explorations with ASEAN countries.

Will Chinese Soft Power Work?
The improvement at the ARF is acknowledged as a huge step towards the peaceful resolution of the dispute. The reception of the guidelines lessened pressures and promoted Confidence Building Measures (CBM’s). Also given the economic leverage that China has on the South East Asian nations, it certainly would not want to lose its place to the US or Japan in playing the role of major funder or technology provider in the joint development to explore oil and gas reserves.

Moreover, economic interests are not a fundamental guarantee of stable bilateral relations in the long term, though deep-rooted economic and trade exchanges would make each nation more cautious when considering strategic issues. However with the rise of national sentiment and intensification of conflict, economic and trade ties may be obliged to give way to political and strategic considerations. Therefore, if the China-ASEAN relations are to maintain long-term stability, their relationship cannot be limited merely to the level of economic interests. In the future, when the time is ripe, both China and ASEAN jointly need to introduce a new bilateral exchange mechanism.