 The most notable dispute is over the second Thomas Shoal, which the Philippines occupies. A crucial deal was reached that aimed to establish a mutually acceptable arrangement at the Shoal without conceding either side's territorial claims. China has disputes with several governments over land and sea borders, many of them in the South China Sea. The rare deal with the Philippines could spark hope that similar arrangements could be forged by Beijing with other rival countries. I'm Karen Chamas.