Jorge Costa Oliveira
Against a historical backdrop where the U.S. (and much of the West) have aimed to contain China’s rise, starting in Asia, the analysis of China’s and the U.S.’s (and other Western countries’) relationships with Southeast Asian nations is of particular importance. These countries formed the Association of Southeast Asian Nations (ASEAN), which is now a free trade area with nearly 700 million inhabitants.
The increase in foreign trade and investment between China and ASEAN countries shows a gradual economic integration. Trade between ASEAN and China has significantly increased, from $235.5 billion in 2010 to $878 billion in 2022, with China being ASEAN’s top trading partner since 2009. Chinese investment flows to ASEAN reached $15.5 billion in 2022, making China the fourth largest source of FDI in ASEAN (6.9% of the total). ASEAN is now China’s main trading partner, surpassing the U.S. and the EU.
On the other hand, China’s claim and effective occupation of almost the entire South China Sea conflicts with the claims of other coastal countries, which have sought military partners (especially the U.S.) to counterbalance China’s growing naval power.
Successive U.S. administrations and analysts have highlighted the “upward trend of unhelpful and coercive and irresponsible Chinese actions in the South China Sea” and their threat to the maritime interests of Southeast Asia. In turn, Chinese analysts and policymakers emphasize to Southeast Asian officials the dangers associated with the “provocations” of the so-called “new Cold War” by the U.S. This battle in which U.S. and Chinese officials are clashing is still in its early stages.
However, ASEAN countries wish to have the best of both worlds.
On one hand, they want to maintain access to the vast Chinese market and benefit from Chinese investments, especially in infrastructure (largely under the BRI); on the other hand, they wish to maintain close relations with Western countries – particularly with the United States – whether due to the relevance of these markets or military cooperation, in order to mitigate the centripetal effect of China’s growing economic, commercial, and military power in the region.
For the avoidance of doubt, the Prime Minister of Singapore, Lee Hsien Loong, warned that “Indo-Pacific cooperation” proposals are welcome if they are inclusive and deepen regional integration, but they should not undermine ASEAN agreements or “create rival blocs, deepen divisions, or force countries to take sides.” And the former Indonesian president, Joko Widodo, called for a vision of the Indo-Pacific that includes China, stating that ASEAN and China have no alternative but to collaborate.
Moreover, attention should be paid to the 2024 Survey-Report of the ISEAS – Yusof Ishak Institute. This survey-report reveals that Japan, the U.S., and the EU are trusted more than China. However, it also shows that when asked which country they would prefer to align with if forced to, for the first time, China (slightly) surpasses the U.S. in preference.
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