Washington will engage more with South-east Asia

Significance She addressed two key issues during her trip: tensions in post-coup Myanmar and China’s growing regional footprint. Shortly after she left the region, the United States announced that it would donate unused COVID-19 vaccines abroad, including to South-east Asia. Impacts Washington will tighten its sanctions on the Myanmar military while supporting ASEAN’s five-point plan to ease the country’s crisis. The National Unity Government, a parallel administration to Myanmar’s junta set up by its opponents, will try to attract greater US backing. Manila and Washington may extend negotiations over renewing their Visiting Forces Agreement to prevent the pact expiring in August.

Subject Outlook for Thai-US-China relations. Significance Chatchai Thipsunaree, Thailand’s permanent secretary in the Ministry of Transport, confirmed on May 17 that construction of the long-awaited Thai-China high-speed railway will begin this year. The project reflects the growing momentum in Thailand’s relations with China, and refiguring of ties with the United States. Impacts Trump administration officials see less strategic imperative in the US-Thailand alliance than previous administrations. China’s growing presence in South-east Asia, particularly on the Mekong, will trigger resistance from affected populations in Thailand. Thai officials will allow Chinese infrastructure projects to proceed despite local protests.


Subject South-east Asian defence budgets. Significance The pressure of responding to the COVID-19 pandemic is prompting many South-east Asian governments to cut defence spending and postpone or cancel new arms acquisitions. Meanwhile, China and the United States continue to vie for influence in the region. Impacts Piracy attacks will increase across the region as socio-economic distress rises and budgets for navies and coast guards fall. ASEAN unity will fracture as tensions among member states increase. Economic problems will cause political instability across South-east Asia, possibly even leading to military coups in certain countries.


Subject Development of South-east Asian coastguards and their geopolitical implications. Significance Senior coastguard officers from Australia, Japan, the Philippines and the United States will meet later this year to discuss cooperation and capacity-building -- and the assertive actions of China's coastguard in littoral waters. With external partners' support, South-east Asian states are developing their coastguards to fight crime and assert maritime territorial claims. Impacts Fishing activities will probably trigger spats between South-east Asian and China's coastguards. Gradually, inter-operability between South-east Asian coastguards will expand. Tokyo and Washington will use coastguards to deepen ties with South-east Asian countries. There could be frictions between Indonesia's and Malaysia's coastguards over waters around Ambalat.


Significance The preferential US trade programme faces renewal or lapse by December 31. South-east Asia’s economies are structured to take advantage of the GSP and many of the products exported to the United States under GSP (such as light manufactures and seafood) are important for South-east Asia’s supply chains. Impacts Vietnam may make another application for inclusion in the US GSP programme. The more authoritarian South-east Asian countries could find it easier to gain US GSP preferences under Trump. The Trump administration could use the GSP as a bargaining chip in trade negotiations or renegotiations.


Significance Japan is viewed by ASEAN states as the most constructive player among the major powers. China is seen as aggressive and the United States as unreliable under President Donald Trump. Impacts Suga is unlikely to remain in office for more than a year. Post-pandemic economic recovery in Japan will be slow due to weak demand for its manufactured goods at home and abroad. China’s stance over the disputed Senkaku/Diaoyu Islands and the missile threat from North Korea will be Tokyo’s top security concerns.


Subject Headwinds for US-ASEAN trade. Significance The Office of the United States Trade Representative (USTR) last month withdrew ‘developing country’ status from several countries, including half the ASEAN states. This 'developing' status to a large extent protects countries that have it from US investigations into their trade practices. Impacts US companies will file more trade complaints against their South-east Asian rivals because the threshold for such complaints will be lower. More US tariffs on goods from ASEAN countries would increase the cost of doing business for South-east Asia. South-east Asian public opinion towards the United States will deteriorate.


Significance The region’s states try to avoid being drawn in, individually and under the aegis of ASEAN. If tensions between Washington and Beijing were to get out of hand, they could come under greater pressure to take sides. Impacts Washington is unlikely to press the region’s states to allow it to establish military bases in their territories. If Donald Trump is re-elected US president next month, he will continue to take a hard line on Huawei and other Chinese tech companies. China and the United States will struggle to increase their soft power in South-east Asia.


Subject The outlook for the current migrant crisis in South-east Asia. Significance Over the last three weeks, an estimated 25,000 Rohingya and Bangladeshi migrants have sought to reach Indonesia and Malaysia, on boats mostly abandoned by people smugglers based in Myanmar, Bangladesh and Thailand. Malaysia and Indonesia have received around 3,000 such migrants so far. Seeking a solution, a regional summit will be held in Bangkok on May 29, including representatives from Myanmar, Australia and the United States. Meanwhile, suspected people-smuggling camps discovered in Thailand and Malaysia in May have led to allegations of official complicity. Impacts Amid allegations of official complicity in people smuggling and trafficking, scrutiny of the Thai and Malaysian governments will increase. Discovery of further people smuggling camps in other ASEAN countries, and allegations of official complicity, are possible. Capacity-building for ASEAN states' police forces, and ASEAN itself, is needed to counter people smuggling and trafficking. South-east Asian countries will enhance maritime patrols to search for other migrants.


Subject Outlook for India-ASEAN ties. Significance Speaking at the ASEAN-India and East Asia summits in Vientiane in September, India's Prime Minister Narendra Modi singled out South-east Asia as central to India's 'Act East' policy, referring to the "common strategic priorities of securing our societies and bringing peace, stability and prosperity to the region". India has also upgraded defence links with Vietnam, signalling that it seeks a more proactive stance against China's economic influence and territorial assertiveness in South-east Asia. Impacts Regional transport corridors would help ASEAN manufacturers develop supply chains and attract South Asian investment. However, such corridors face security constraints, especially around border areas. India's deepening security ties with the United States, Japan and Australia will help it advance defence relations in South-east Asia.


Significance South-east Asia provides the Kremlin opportunities to advance its ‘great power’ interests. Meanwhile, the region remains a key theatre for the United States and China to play out their growing rivalry. Impacts Russia may try to sell nuclear power plants to the region, although it would face strong competition from other countries. Military action by Russia against Ukraine would hurt Moscow’s image in South-east Asia but no regional state would respond with sanctions. Russia-China relations will strengthen but the two countries will stop short of agreeing a formal political-military alliance.


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