Southeast Asia in the face of intensifying great power rivalry

Former US Ambassador to China Nicholas Burn speaking at Shanghai’s celebration of 45 years of US–China relations in 2024

For much of its history, Southeast Asia has been the object of competing great power interests. From the cultural influences of Indic, Chinese, and Arabic civilizations, through the expansion of European and Japanese colonialism, to the Cold War rivalry that exploded in Indochina, the states of Southeast Asia—and their predecessor polities—have long been confronted by the challenge of preserving independence in the face of pressures from external powers. In keeping with these historical patterns, the region once again finds itself an arena for great power competition, this time between the US and China, the world’s two largest economies.  

Since the end of the Pacific War, the US has been an integral part of the regional security architecture in Southeast Asia—so much so that its status as the “indispensable offshore balancer” is hardly contested today by regional states (1).

The recent history of Chinese relations with post-colonial Southeast Asia has been somewhat ambivalent. In the maritime states of the Indo-Malay Archipelago, China had always been kept at a safe distance for fear of the influence it could exert on the small but consequential ethnic Chinese minorities in Indonesia and Malaysia.

Further to the north, even as Vietnamese communists sought assistance from Peking during their struggles against the French and later, the Americans, the baggage of a very difficult relationship with China always cast a long shadow. This culminated in the punitive action launched by China against Viet Nam in February 1979.  

With the end of the Cold War, however, the role of China in Southeast Asia has grown in considerable importance. Surrounded by major powers with which Beijing has a legacy of complex relations—Russia, India, Japan, and further afield, the US—the only direction where the extension of Chinese interests would not run up against another major power is southwards (2). It is for this reason that the South China Sea features prominently in the Chinese strategy to break through the first island chain (3).

USS Omaha conducts weapons exercise in South China Sea

China has endeavoured to strengthen its relations with Southeast Asia primarily through the avenue of trade. Since 2022, ASEAN, the regional organisation that encompasses all 10 Southeast Asian states, has surpassed the US and Europe to be China’s largest trading partner.

Southeast Asia also features prominently in Chinese President Xi Jinping’s Belt and Road Initiative (BRI), which seeks to provide welcome loans and investments for infrastructure-starved Southeast Asian states, particularly those in mainland Southeast Asia such as Cambodia, Laos, and Myanmar.

Beijing has also attempted to draw Southeast Asia deeper into its orbit by parlaying the concept of “Asia for the Asians” in terms of its desired reconfiguration of the regional geostrategic landscape. This latter bid has been met with studied distance on the part of Southeast Asian states, even as many nurse reservations towards the prevailing US-led order especially under the erratic leadership of Donald Trump. 

Two events in the recent past are instructive of how Chinese view its role and place in the region. First was the outburst from Yang Jiechi, former foreign minister of China, at the 2010 meeting of the ASEAN Regional Forum when he famously said: “China is a big country and other countries are small countries, and that’s just a fact (4).” Admittedly, the remarks were in response to what he perceived to be American provocations over Chinese activity in the South China Sea – and allegedly directed at the foreign minister of Singapore. Nevertheless, it also provided a sobering glimpse of how China viewed the smaller states in its neighbourhood.  

Former foreign minister of China Yang Jiechi: “China is a big country and other countries are small countries, and that’s just a fact.”

Second, during a 2016 meeting in Singapore between American and Chinese think tanks, a senior Chinese delegate, formerly from the People’s Liberation Army (PLA), opined that: “the Asia-Pacific may be big enough for everyone, but the West Pacific may not be big enough. The South China Sea is certainly not big enough (5).” He was, no doubt, referring to the presence of the US navy in what the international community maintains are international waters in the region. 

The unquestionable reality that China is an economic powerhouse has led many to define the central feature of the regional architecture as one where regional states turn to the US “for security” and China “for economics”. This is a mischaracterisation of how regional states view their relationships with the two great powers; and it further betrays a mindset rooted in flawed binary thinking that is not reflective of intra-regional discussions and postures.  

To be sure, Southeast Asian states have readily embraced economic relations with China. Indeed, no country in the world can afford to ignore the immense size and potential of the Chinese economy, not to mention its leading role in the development of artificial intelligence, robotics, electronic vehicles, and green energy. But this should not be confused with a single-minded turn to China as the driver of the regional economy.

There is grave concern among regional states about how the US under President Trump has upended global trade, not least because Southeast Asians are heavily invested in the rules-based free and open trading system which has allowed their economies to flourish in the last three decades. For this reason and more, regional states will still see the US as an integral actor in the economic architecture as well. How else can one explain the scramble among regional states to open negotiations with the Trump administration following their announcement of the “Liberation Day” reciprocal tariffs. 

US President Donald Trump announcing his 'Liberation Day' tariffs in April 2025

Moreover, while Beijing has made a great play of its economic initiatives, such as the establishment of the Asia Infrastructure Investment Bank, the introduction of the BRI and the Global Development Initiative, and its central role in the BRICS grouping, the US remains the largest investor in Southeast Asia by a considerable distance.

The (re)establishment of trade relations with Washington are therefore a priority for every Southeast Asian government today. In fact, China trails behind not only the US but also Japan and the European Union in terms of investment in Southeast Asia, though the gap is closing. Likewise, it bears recalling that in terms of infrastructure, Japan has been a longstanding partner of many Southeast Asian states since the late 1970s, and Tokyo continues to invest heavily in the region, both bilaterally and through the Asia Development Bank.  

As US-China relations continue to chart an uncertain path, the alignment choices of Southeast Asian states should not – indeed, cannot – amount to genuflection in the direction of either of the two great powers. Given its long and at times tortured history of interaction with external powers, Southeast Asia is acutely aware that a binary approach to geopolitics is not in the regional interest. What this means then, is the imperative of regional unity in the face of competing pressures is more urgent today than ever. 

About the author 

Joseph Chinyong Liow is the Asia New Zealand Foundation’s Non-Resident International Fellow, and the Tan Kah Kee Chair Professor in Comparative and International Politics at Nanyang Technological University, Singapore. 

The Foundation's Asia in Focus initiative publishes expert insights and analysis on issues across Asia, as well as New Zealand’s evolving relationship with the region.