That's China's actual territorial waters claim. From this article. Much better and more thorough analysis of Chinese naval ambitions here.
(For actual alternate history go here.)
The Confederacy was not a bunch of generally well-meaning dudes who went a little too far, it was a gang of racist traitors who launched a bloody war to defend a monstrously unjust institution [and tried to destroy the Union in the process - MC]. Having neo-Confederate sympathies in America should be equivalent to supporting the reconstituted Fascist party in Italy, or worse.