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Foreign Policy

A Geopolitical Rollercoaster: U.S.-China Competition in Southeast Asia in 2022

Jan 11, 2023

For Southeast Asia, geopolitics in the year 2022 began over eight thousand miles away on the other side of the massive Eurasian landmass. Russia’s invasion of Ukraine not only caught Europe by surprise, but also the majority of (if not all) nations in Asia. The initial shock was absorbed by the West, with European nations scrambling for an appropriate diplomatic, economic and military response. It didn’t take long, however, for Southeast Asian nations to appreciate the gravity of the latest crisis in Europe. 

To begin with, smaller regional states felt extremely vulnerable to great power predation, prompting the city-state of Singapore to impose sanctions against Russia. Moreover, the war in Ukraine triggered a global energy and food price surge, which imperiled tens of millions of Southeast Asians living close to the poverty line. 

Just as worrisome, was the sharpening of geopolitical fault lines between the United States and China, which adopted divergent positions on the crisis. Consequently, Southeast Asian anxieties grew over the trajectory of the great power rivalry in the region; these apprehensions reached a fever pitch when former U.S. Speaker of the House Nancy Pelosi embarked on a controversial visit to Taipei that  immediately triggered a naval showdown between the U.S. and China. 

Nevertheless, far from succumbing to strategic fatalism, Southeast Asian nations rose to the geopolitical occasion by displaying tremendous diplomatic proactiveness. By all accounts, the Association of Southeast Asian Nations (ASEAN), and key members of Indonesia and Singapore in particular, successfully managed to nudge the two superpowers towards responsible statesmanship and a much-needed détente, an indispensable pathway to peace and stability in Southeast Asia and the broader Indo-Pacific region. 

The First Shock 

It’s hard to overstate the geopolitical shockwaves unleashed by the war in Ukraine. Almost overnight, Europe’s massive financial and energy-driven relationship with Russia was put in jeopardy, with no less than Germany, the continent’s economic powerhouse, declaring a 'turning point' (“zeitenwende”) in its post-war foreign and defense policy. Together with the United States and other major Western partners, Europe imposed unprecedented financial, economic and energy sanctions against Russia, its largest and most consequential immediate neighbor. 

The North Atlantic Treaty Organization (NATO), meanwhile, mobilized massive military aid for Ukrainian forces, which managed to successfully repel a full-scale Russian invasion within a matter of weeks. To put things into perspective, Washington alone provided close to $22 billion in security assistance “to help Ukraine preserve its territorial integrity, secure its borders, and improve interoperability with NATO.”  

Though not as directly affected as Europe, the Southeast Asian region was visibly shaken by Russia’s military aggression. The city-state of Singapore decried the brazen invasion of Ukraine as an “existential issue” to all small, post-colonial nations. Accordingly, the Asian financial hub pressed ahead with a comprehensive sanctions package against Russia, thus imperiling a crucial bilateral free trade agreement. In response, Russia placed the Southeast Asian nation on a black list for its “unfriendly actions.”  

Despite their efforts, even Southeast Asian states that refused to condemn Russia’s actions in deference to longstanding strategic relations couldn’t escape the fallout of the crisis in Europe. Diplomatically neutral nations such as Indonesia and the Philippines, the two most populous nations in Southeast Asia, grappled with rising food and energy costs due to the disruptive impact of the war in Ukraine. The repercussions extended to Russia’s regional allies, who also began to suffer.

Thanks to Western sanctions against Moscow, Vietnam struggled to conduct even routine trade and investment activities with its top strategic partner. For instance, the Vietnamese Deputy Prime Minister openly admitted, “the sanctions imposed on Russia by the United States and Western countries pose big difficulties for us hampering the implementation of energy projects.”

The Fourth Taiwan Strait Crisis 

For many Southeast Asian nations, another troubling result of the war in Ukraine was the exacerbation of geopolitical tensions between the U.S. and China. In fairness to China, the Asian powerhouse adopted a broadly nuanced stance on the crisis, repeatedly emphasizing the importance of respecting the territorial integrity and sovereignty of all nations, including Ukraine. 

Nevertheless, China also echoed Russia’s grievances by blaming NATO expansion into the post-Soviet world as the main driver of the latest crisis. Furthermore, the Asian powerhouse expanded its trade with Russia, which offered affordable energy products, in clear contravention of U.S.-led sanctions against the Eurasian power. 

Earlier this year, Russian President Vladimir Putin and Chinese paramount leader Xi Jinping also expressed their shared commitment to create a post-American, multipolar order – signifying a budding alliance between the two Eastern powers. These geopolitical tensions among great powers reached a dangerous level following U.S. Speaker Nancy Pelosi’s controversial visit to Taiwan, which is considered a ‘renegade province’ by Beijing

Ahead of Pelosi’s visit, the U.S. deployed warships to the area to prevent any potential military intervention by China. Despite showing relative restraint, the Asian powerhouse still forged ahead with massive wargames all around Taiwan to express its diplomatic outrage as well as display its modern warfare capabilities. 

China also announced sanctions against Pelosi herself as well as multiple individuals in Taiwan while suspending a series of institutionalized dialogues and confidence-building measures with the U.S. It was precisely at this critical geopolitical juncture that Southeast Asian nations began to rise to the occasion by proactively mediating between the two superpowers. 

ASEAN Steps In 

Perturbed by the direction of the Sino-American rivalry, the ASEAN embraced principled neutrality. During a foreign ministers’ summit in August, which saw representatives from U.S., China, Japan, Russia, and Europe in attendance, ASEAN warned against any “provocative action [that] could lead to miscalculation, serious confrontation, open conflicts and unpredictable consequences among major powers.”  Kung Phoak, Cambodia’s deputy foreign minister, who represented this year’s ASEAN chairman, underscored how Southeast Asian nations “hope de-escalation happens… and normalcy returns to the Taiwan Strait.” 

Meanwhile, key ASEAN members also cranked up their diplomatic efforts. For instance, top Singaporean leaders publicly counseled the superpowers to “mishap or miscalculation” lest they “sleepwalk into conflict”. As a major financial hub and trade-driven nation, Singapore also warned against disruptive economic sanctions that could create a ‘digital iron curtain’ at the expense of peace and prosperity in Asia. 

While Singapore leveraged its historical status as a mediator between China and the West, neighboring Indonesia optimized its position as this year’s Group of 20 (G20) chair as well as the incoming ASEAN chairman next year. Accordingly, Indonesian President Joko Widodo embarked on an unprecedented trip to Kyiv and Moscow to explore a lasting peace plan in addition to its confidence-building measures to prevent further disruptions to the global food and energy supply.   

Thanks to Indonesia’s leadership, all G20 powers, except for Russia, released a strongly-worded statementcalling for the immediate end to the war and, accordingly, measures to ensure sustainable food and energy exports from Ukraine and Russia. Days later, leaders at the Asia-Pacific Economic Cooperation (APEC) Summit adopted an identical position, underscoring Indonesia’s global consensus-building capabilities. 

Even more impressive, however, was Jokowi’s successful efforts at mediating between the U.S. and China, culminating in the fateful meeting between Chinese paramount leader Xi Jinping and U.S. President Joseph Biden on the sidelines of the G20 summit in Bali, Indonesia. 

The two global leaders acknowledged their shared responsibility in (i). managing their inevitable competition and, accordingly, (ii). restoring frayed channels of communications and other cooperative bilateral dialogues to avoid unwanted conflict and jointly address shared global concerns such as climate change, terrorism, and post-pandemic economic recovery. Thanks to the strategic maturity of the two superpowers, and the proactive diplomacy of ASEAN, the world can head into a new year with greater geopolitical optimism.

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