Korea Policy Vol. 3, Issue 1

The return of Donald Trump to the Oval Office has ushered in an era of uncertainty. From Ukraine and the Middle East to the global climate agenda and “Liberation Day” tariffs, the second Trump administration has embarked on a foreign policy behavior that departs—certainly in form if not in substance—from his predecessors. Against this backdrop of uncertainty and transformation, the nature of U.S. competition with China will have consequential significance for the entire world and most certainly Southeast Asia, a region that has found itself an arena for this great power rivalry.

Southeast Asia needs to consider greater diversification and integration efforts to improve their collective resilience in order not to be held hostage to U.S.-China rivalry. This will entail deepening engagement at both bilateral and multilateral levels with other external powers, in which some have fared better than others. Vietnam and Singapore, for instance, are enmeshed within robust trade networks such as the Comprehensive and Progressive Agreement for Trans-Pacific (CPTPP) and trade agreements with the European Union, while Thailand is seeking to conclude long-overdue trade talks with the European Union. Indonesia and Malaysia, on the other hand, are moving in the other direction in seeking closer ties with Russia and Central Asia as well as the BRICS grouping. Cambodia recently forged free trade deals with South Korea and the United Arab Emirates, but such efforts at diversifying trade ties are still too incipient to offset being cut off from what is its largest export market, the United States.

In addition, Southeast Asian states must double down on their efforts at regional integration. Economic integration among Southeast Asian countries has long figured in the region’s agenda, but heightened global uncertainties have injected new urgency into this mandate. They must also look to each other as real, viable complements to shared strategic interests, rather than taking a myopic view focused on external powers. Such efforts can and should start small rather than through the cumbersome processes of ASEAN. Recent defense cooperation between the South China Sea claimants of Vietnam and the Philippines and the new special economic zone between more developed Malaysia and Singapore are modest but welcomed signs of mutual confidence-building. Such efforts are easier said than done, but there is a common denominator on which they can build a common cause: no Southeast Asian state wishes to be in a position where they have to choose between the United States and China, and all Southeast Asian states are staring at the possibility of being collectively squeezed by the two great powers.