Anti-China riots in Vietnam have escalated following China’s towing of an oil rig into South China Sea waters contested by both countries.

More than 21 people have been killed and a huge foreign steel project has been set ablaze.

China’s top General Fang Fenghui said its oil rig will continue drilling in contested waters in the South China Sea, despite deadly anti-Beijing riots in Vietnam.

Fenghui said Beijing could not afford to lose an inch of territory, blaming Hanoi for stirring up trouble in the region.

He also warned that America’s efforts to increase its focus on Asia were fuelling tensions in the region.

"More than 21 people have been killed and a huge foreign steel project has been set ablaze."

China claims almost the entire oil and gas-rich South China Sea, rejecting rival claims to parts of it from Vietnam, the Philippines, Taiwan, Malaysia and Brunei. In the East China Sea, Beijing is locked in an increasingly bitter dispute with Japan.

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By GlobalData

But the area near the Paracel Islands where China National Offshore Oil Corporation (CNOOC) has placed a rig, known as HD-981, is conspicuous not for the oil and gas resources that lie there, but for the oil and gas resources that do not.

Critics claim that Beijing is simply interested in pushing its neighbours as much as possible to maximise the swath of sea it ultimately will control, rather than targeting an energy-rich zone.

The Vietnamese are also angered by what they call exploitation of its raw materials and resources by Chinese firms, and say although bilateral trade exceeds $50bn annually, Chinese investment in Vietnam is only around $2.3bn.

Properties in the Vietnam-Singapore Industrial Parks (VSIP) I and II in Binh Duong were targeted by thousands of protesters demonstrating over China’s deployment of an oil rig.

The Planning and Investment Ministry blamed the clashes on "extremists" and warned that they could seriously affect the investment environment in Vietnam.

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