US-China Rivalry Increases Tension in Southeast Asia
Lim Peh Hong
WASHINGTON, VOA — As the United States and China compete for influence worldwide, tension is rising between the superpowers in Southeast Asia over economic policies, territorial disputes in the South China Sea and Taiwanese independence.
The Regional Comprehensive Economic Partnership (RCEP) came into effect on January 1. RCEP is a China-led free-trade agreement among 15 Asia Pacific nations including all 10 members of the Association of Southeast Asian Nations (ASEAN), as well as Australia, Japan, South Korea and New Zealand. It is the largest free trade agreement in the world.
At the 25th China-ASEAN summit last month in Cambodia, China’s Premier Li Keqiang said in a speech that trade volume between China and ASEAN had reached a new high of $798.4 billion in the first 10 months of 2022.
“We have worked together for the Regional Comprehensive Economic Partnership (RCEP) to be signed and implemented, and hence built the world’s largest free trade area, taking our open and interconnected development to a new level,” he said in the speech.
However, it might be too early to determine whether RCEP has delivered significant economic benefits to ASEAN, according to Hunter Marston, a doctoral candidate at Australian National University (ANU) studying great power competition in Southeast Asia.
“ASEAN-China trade hit a record high in [the first 10 months of] 2022, which is something to watch, but it’s hard to say whether its trade growth will come mainly from RCEP,” he told VOA Mandarin. “RCEP just lowers barriers and makes trade more efficient, but so far, it is difficult to say that it has brought immediate and clear benefits.”
To counter RCEP, U.S. President Joe Biden launched the Indo-Pacific Economic Framework (IPEF) in May.
With 14 members, including Australia, India, Indonesia, South Korea and Japan, the IPEF is intended to reaffirm U.S. economic engagement in the region and provide a Washington-led alternative to Beijing’s RCEP.
“The future of the 21st century economy is going to largely be written in the Indo-Pacific — in our region,” Biden said during IPEF’s launch event in Tokyo. “We’re writing the new rules.”
Ian Chen, a professor at the Institute of Political Science at Taiwan’s National Sun Yat-sen University, questions whether IPEF will be able to have an impact on Southeast Asia’s economic dependence on China anytime soon.
“I think it is unlikely in the short term,” he told VOA Mandarin. “IPEF doesn’t require very strict commitments, so participating countries can actually determine how involved they want to be. With such loose requirements, it can be difficult to achieve the goals you want to achieve.”
Josh Kurlantzick, a senior fellow for Southeast Asia at the Council on Foreign Relations, disagrees that Biden’s IPEF was purely in response to China’s RCEP.
“The Indo-Pacific Economic Framework is in some ways in response to China’s economic actions in the region, but it’s more generally in response to complaints that the U.S. had no trade policy in the region,” Kurlantzick told VOA Mandarin. “I don’t think the U.S. is just reacting to China.
“The U.S. has abandoned trade leadership and trade participation in Asia for a long time,” Kurlantzick added. But “the Indo-Pacific Economic Framework, a pseudo economic cooperation thing, doesn’t really do much.”
A lot of IPEF’s details have still not been made public, but ANU’s Marston predicts Biden will announce more about the economic initiative in 2023.
“Although IPEF is more symbolic than substantive, I think seven of the 10 ASEAN countries have been invited and agreed to join, which shows that U.S. economic engagement in the region is still attractive,” Marston said.
Washington still leads in investment in the region — U.S. investments rose by 41% in 2021 to $40 billion — but Beijing’s investments rose by 96% to nearly $14 billion, according to the 2022 ASEAN Investment Report.
“Although the United States still leads in investment, I think ASEAN is becoming a more multipolar competition region,” Marston added.
Economic rivalry between Washington and Beijing has taken center stage this year, analysts told VOA Mandarin, but other flashpoints have arisen, too.
Some Southeast Asian countries worried that U.S. House of Representatives Speaker Nancy Pelosi’s August visit to Taiwan might make China more likely to take military action, according to Alan Yang, a professor at National Chengchi University in Taiwan.
“From the United States, to China, to the Taiwan Sea, to the South China Sea, it is difficult to separate these issues,” Yang told VOA Mandarin. “There was no major South China Sea action this year. To some extent, it is still subject to two major external forces. One is the U.S.-China rivalry, and the other is the impact of the pandemic.”
Kurlantzick also pointed to China’s ongoing militarization of the South China Sea, as well as Washington’s escalating efforts to block China’s access to highly coveted advanced semiconductor chips. Still, looking ahead to 2023, he added that conflict over Taiwan is perhaps of greatest concern.
“The U.S. and China are engaging in a dance with Taiwan, getting closer and closer to possible conflict,” Kurlantzick said.