Opening a Strategic Pandora’s Jar? US-China Uncertainties and the Three Wandering Genies in Southeast Asia

Uncertainty is nothing new in US-China relations. Indeed, it is a constant feature of all big power relationships. However, recent US-China interactions under Donald Trump and Xi Jinping have heightened uncertainties at multiple fronts, with an intensity that increasingly pushes the US allies and partners around Asia—including those in Southeast Asia—to reassess their fundamental outlooks and options. The escalating trade confrontation between the world’s two largest economies—alongside a series of profound events in late May and the first half of June 2018 (e.g. US disinvitation of China from the RIMPAC naval exercises, the widening cracks in the Western democracies at the tense G7 Summit, the show of “unity” among China, Russia, and key Eurasian countries at the expanded SCO Summit, Trump’s unilateral security promises at his meeting with North Korean leader Kim Jong-un)—not only signify a power shift from the West to the East, but also a widening divergence in interests between the world’s two strongest powers. They may well be part of what scholar Khong Yuen Foong describes as the initial “transition tremors” in today’s international system.¹  

I argue that these tectonic structural changes—particularly the perceived risks from the Trumpian unpredictability—have opened a strategic Pandora’s jar in Asia (and beyond). US allies and friends are more seriously thinking about and adjusting to the possibility of a less committed and less reliable (and for some, a potentially harmful) America—rather than a highly engaged, committed, and indeed, indispensable patron—as a factor in their respective external strategies. These fundamental reassessments are pushing many countries to review their options, exploring ways to protect their own core interests while coping with uncertainties and risks from diffuse directions. The genies are out of the jar, with implications for Asian countries’ external calculations and the broader international order.

Three genies are the most intense: the region-wide anxieties over the relative credibility, trust, and capabilities among the big powers.² To be sure, these anxieties have always been present in post-1945 Asia. Throughout the past decades, they were managed—and contained—through a combination of hegemon-dominated alliances, norm-based institutions, and interest-linked interdependence. However, the Trumpian unpredictability and the worsening uncertainties in US-China relations have loosen the jar’s lid, unleashing the genies and engendering a cycle of actions-reactions among the Asian countries.

Strategic Adjustments and Adaptations

Realizing that they might no longer be able to continue counting on the United States for their security to the extent and in the ways they have, the US allies and partners are slowly adjusting and adapting—albeit unevenly—to the emerging reality by pursuing a multi-pronged strategy. In addition to further strengthening one’s own defense capability while continuing to support the US-centered “hub-and-spoke” system and retain Washington’s involvement in regional affairs for as long and as much as possible, they have simultaneously pursued two seemingly contradictory measures. These include: 1) gradually stepping up efforts to develop stronger ties between the “spokes”, and among the other “likeminded” nations near and far, who share the strategic goal of wanting to “push back” an increasingly powerful China; and 2) mending fences and improving their bilateral relations with China.

This is not to suggest that US allies and partners have departed from their long-held policy of relying on America as the cornerstone of their security strategy. Most, if not all, still want American-led order. However, the more they are worried by Trump’s statements and actions, e.g. his questioning of the longstanding alliances and his preference for bilateral deals over multilateral ones, about the reliability of the United States as a patron, the more they see the growing needs of expanding partnerships around and beyond the “hub,” rallying under the aegis of a “free and open Indo-Pacific” strategic concept to constrain China, but taking steps (in different degrees) to mend fences with China.³ The two contradictory measures, in essence, are precautionary moves aimed at hedging against the risks surrounding an increasingly unpredictable America and an increasingly powerful China in the years to come.

Examples of these precautionary measures abound. Japanese prime minister Abe Shinzo, while endeavoring to keep TPP alive in the absence of US involvement, has actively sought to build a coalition of likeminded nations in the Indo-Pacific region to counter Chinese hegemony. Tokyo has attempted to do so by pursuing a “free and open Indo-Pacific” strategy, through initiatives in both the security and development domains. These include: strengthening Japan-Australia and Japan-India partnerships; providing defense assets to ASEAN claimant countries in the South China Sea; and advocating the Partnership for Quality Infrastructure (PQI) as an alternative vision to China’s ambitious BRI. Since late 2017, however, there are signs of reconciliation between Japan and China. In November 2017, Abe and Xi met on the sidelines of the APEC Summit in Danang, both sides agreeing to promote better bilateral ties.⁴ In May 2018, Abe initiated a historic phone call to Xi—the first-ever teleconference between Japanese and Chinese leaders—ahead of the China-Japan-Korea Trilateral Summit in Tokyo, where Abe played host to Chinese premier Li Keqiang and South Korean president Moon Jae-In.⁵ Moon had visited China in December 2017, in an attempt to restore ROK-PRC ties after a year-long row over THAAD deployment.⁶

Similar patterns can be observed in India’s and, to some extent, Australia’s regional strategies. India-China relations hit a new low in 2017 over their border standoff in Doklam. In November 2017, India took part in a working-level meeting of the Quadrilateral Security Dialogue or “the Quad,” a grouping of four like-minded democracies of Australia, India, Japan, and United States, which was first mooted by Abe in 2007. Held in Manila on the sidelines of ASEAN-plus summits during Trump’s maiden tour to East Asia, the meeting saw each of the four partnering states releasing its own statements that reflected varying priorities, with India welcoming the opportunity to cultivate “a free, open, prosperous and inclusive Indo-Pacific region,” while emphasizing the need to develop regional connectivity for the Quad “based on their converging vision and values.”⁷ The Quad has been developed in tandem with various sets of bilateral ties within the bloc, such as India-Japan, India-US, and India-Australia partnerships. While each of these bilateral partnerships is motivated by a distinctive set of drivers, their evolutions are all shaped by the states’ shared—albeit differing degrees of—desire to counter the perceived Chinese expansionism. Moreover, the four countries have simultaneously sought to develop partnerships beyond the Quad, with ASEAN as a focus, both bilaterally (e.g. Australia-Indonesia, India-Vietnam, Japan-Philippines) and at the group level (e.g. India-ASEAN Commemorative Summit in January 2018, Australia-ASEAN Summit in March 2018).⁸ These countries’ ASEAN pivot is shared by South Korea, whose new Moon administration has launched its New Southern Policy. Significantly, alongside efforts to diversify their own partnerships, each of these players has also attempted to mend fences with Beijing. Following the footsteps of Abe and Moon, Indian prime minister Modi travelled to Wuhan in May 2018 for an informal summit with Xi. Australian prime minister Malcom Turnbull reportedly will visit China later this year to smooth the bumpy bilateral ties.⁹     

Notwithstanding the Quad countries’ common desire to check China’s regional ambitions, there is a divergent set of interests among them. Australia and Japan, who are more skeptical about the value of engaging Beijing, view the Quad as the key platform for the likeminded countries in the Indo-Pacific region to push back China. India, on the other hand, insists on pursuing a more balanced policy: while New Delhi shares its fellow Quad members’ goal of constraining and if necessary challenging Beijing, it also insists on engaging its fellow Asian giant for a combination of pragmatic economic and security reasons. India thus feels it necessary to signal that: 1) the Quad is not about containing China; 2) it is “one of the many multilateral dialogues” in the Indo-Pacific region; and 3) India’s maritime partnerships “would not be restricted to the Quad formation with the U.S. and its allies,” but would engage other players in the region, such as Russia.¹⁰ Hence Modi’s informal summit with Russian president Vladimir Putin in Sochi, his summit with China’s Xi in Wuhan, India’s participation in the SCO, and New Delhi’s decision to decline a request from Canberra to join the 2018 Malabar naval exercises with the other Quad members.

In short, while the US allies and partners have all pursued the contradictory measures of diversifying likeminded partnerships and mending fences with China, they have chosen to do so in different ways and to different degrees. They have hedged differently.

Precautionary Recalibration or “Plans B”? 

For now, the two contradictory measures are more strategic precautionary efforts than alternative “plans B.” For the US allies, the former (expanding and diversifying partnerships with likeminded nations) would be neither a credible nor a feasible substitute to their extant alliance with the United States, because the combined strengths of all possible partnerships would still be far below that of the US security umbrella, and because the threat perceptions among the “likeminded” countries do not entirely overlap. The latter (working with China), on the other hand, would probably never be a desirable scenario, because the differences in political values and strategic visions prevent them from viewing China as a friend. The fundamental trust is absent.

Of course, the magnitudes and manifestations of these measures are not static, but dynamic. If and when the United States showed sufficient signs of getting back on track as a more firmly committed and reliable patron—either as a result of self-reassessment, or as a response to allies’ efforts, or both—there will be corresponding recalibration on the part of the US allies, where they feel less need to hedge through the two contradictory measures (and the opposite is true: if America under or beyond Trump shows no signs of getting its act together to restore its role as the indispensable patron, the secondary states are likely to—however painfully—dilute or downgrade Washington in their strategic equation). In a similar vein, if and when China does not respond positively or reciprocate enough the secondary states’ overtures, the states are likely to step up their efforts to persuade the United States to revive its preeminence in Asian affairs, and they are likely to double up their self-strengthening and omni-partnership endeavors (and the converse is true). Finally, if and when the other likeminded countries show increasingly stronger strength—and resolve—in closing their perceptual and action gaps in forging a more concerted, coordinated, and capable coalition vis-à-vis their strategic concerns, the secondary states are likely to feel less pressure to relax or compromise their own interests in interacting with China. (The converse, again, is true.)

What factors ultimately determine these interactive and cyclical processes? Based on the above, it can be inferred that the processes will depend on the distribution of three attributes across the emerging power structure in Asia, i.e. relative credibility, trust, and capability. They shape and limit the policy options and actions of the weaker states in Southeast Asia.

Three Wandering Genies in Southeast Asia

The distribution of credibility, trust, and capability across the international system has to do with all big powers of the day; it is not exclusively confined to any single power. However, in the contemporary international relations where the Trumpian unpredictability is the principal driver (alongside other systemic factors) loosening up the stabilizing lid of the Asian strategic jar, the released genies manifest themselves in: 1) the US credibility lag; 2) the trust deficit on China; and 3) the activism gaps associated with “the other powers.”

Each of these genies carries different types of apprehension—as well as hope—among the weaker states in Southeast Asia (and other parts of the East Asia and Pacific region). These include: the risk of abandonment and the risk of subservience, as well as the dangers of alienation, escalation, and entrapment.

The 1st genie: US credibility lag and weaker states’ fear of abandonment

America’s engagement with Asia is shaped by others’ perceptions of—and reactions to—the relative capability and credibility of its commitment as a “resident power” in this vast and diverse region. Given the superpower’s sheer superiority in strength, very few, if any, doubt the US capability to project and deliver its commitment in Asia. Credibility is a different story. It does not necessarily go in tandem with capability. Indeed, Trump’s unpredictability and his transactional approach to international affairs have increasingly raised concerns about the US credibility to maintain and materialize its security commitment in Asia, its unrivalled capability notwithstanding.

This trend is not a trivial matter, because credibility is the key to commitment. Without credibility, no pledged commitment—however strong one’s capability—will be taken seriously by others (actual and potential followers, sympathizers, and/or opponents). This is particularly crucial for America, which is not geographically resident in Asia. Once credibility is eroded, it will take a long time for Washington to regain the confidence, support, and affinity of its Asian allies and partners. If the trend persists—if the credibility genie wanders and increasingly lags behinds its commitment—this could shake the foundation of the US-led order in Asia. The greater the regional states are concerned about US credibility as a patron, the greater their fear of abandonment.

Under Trump, the United States is continuously undercutting its credibility and undermining its traditional roles in Asia. Upon assuming office in January 2017, the president withdrew America from the TPP. He has repeatedly questioned the value of US alliances, pressuring allies for burden sharing and asking them to do more for their own security in the context of his “America First” agenda. His recent statements and actions have further deepened the anxieties of America’s allies and partners. These take place around the same time as Xi’s China is asserting its resolve—via a combination of economic, diplomatic, and military means—to expand its presence and influence around its peripheries.¹¹ The past weeks, when Trump clashed with the closest US allies over tariffs and other issues at and after the G7 Summit on June 8-9, Xi hosted the annual meeting of the expanded SCO on June 9-10, calling for world harmony while projecting China’s global leadership vision with its cooperative agenda and connectivity-based statecraft. China made gains even at the meeting it did not attend, i.e. the Trump-Kim summit in Singapore on June 12. While Trump’s cozying up to the North Korean dictator left US allies shocked and the Pentagon worried, China was viewed as a winner because of the US leader’s unilateral pledge to call off the annual military exercises and possibly to pull out US troops from South Korea.

To be sure, the Trump administration does attempt to reaffirm America’s commitments through a number of actions, speeches, and documents. The US military has—for the purposes of deterrence, swaggering, and reassurance—continued to mobilize and project its forces in different parts of the region. Some of the activities are traditional routines; some are new initiatives; and some at the invitations of its partners. These include: dispatching the USS Carl Vinson aircraft carrier to Vietnam for a port call at Danang on March 5, 2018 for the first time since the end of the Vietnam War; launching the construction of a US military facility at a Philippine Air Force base in Pampanga on April 17, as part of the 2014 US-Philippine “Enhanced Defense Cooperation Agreement” (EDCA);¹² as well as conducting the 13th iteration of the US-led Pacific Partnership, the largest annual multilateral, multi-service humanitarian assistance and disaster relief preparedness mission in the Indo-Pacific region, from March to June. Key policy statements and documents were issued. At the Shangri-La Dialogue (SLD) in Singapore on June 2, 2018, Secretary of Defense James Mattis declared that “America is in the Indo-Pacific to stay,” emphasizing that the region is the US “priority theatre,” and that the US interests and the region’s “are inextricably intertwined.”¹³ The statement came one day after the secretary’s announcement that the US Pacific Command would now be called the US Indo-Pacific Command. These statements and operations are in line with the strategic ideas spelt out in the National Security Strategy (NSS) in December 2017 and the US National Defense Strategy (NDS) in January 2018.

Nevertheless, the above actions and postures, as important as they are, may not be significant enough to restore Washington’s already eroded credibility in the eyes of its allies and partners. Trump has a long and growing list of flip-flops and unilateral pledges. His on-again, off-again summit with the DPRK leader, as well as his assessment and reassessment about the North Korean threat, were simply the latest examples of the Trumpian unpredictability. This has generated growing unease among US allies and partners in Asia. Malaysian prime minister Dr. Mahathir Mohamed, who returned to power after a surprise election victory on May 9, 2018, stated that he “doesn’t know how to work with someone who kept changing his mind.” He later called Trump “mercurial.”¹⁴

For now, the US credibility lag has not reached a point leading any Southeast Asian states to scale down or stop their strategic ties with Washington. The earlier decisions by the Philippines’ Rodrigo Duterte and Cambodia’s Hun Sen to respectively downgrade their country’s military partnership with America had more to do with the leaders’ own response to US political actions (i.e. criticizing the leaders’ domestic practices), rather than a response to US security behavior. However, if America’s credibility lag persists, it is not inconceivable that more US allies and partners in Southeast Asia would hesitate to add their policy eggs in the US basket, or worse, dilute the US factor in their external strategy in the future.

The 2nd genie: Trust deficit with China and weaker states’ fear of subservience

Trust deficit has long been a problem in China’s interactions with its smaller neighbors to the south. This is mainly due to the unresolved territorial disputes in the South China Sea, but also the weaker states’ problematic past with the giant, as well as their deep-seated fear over power asymmetry.¹⁵ Size does matter.

The trust problem has become more complex in recent years. On the one hand, China’s charm diplomacy towards ASEAN states and its progressively constructive role in regional integration since the 1990s have over time earned Beijing considerable collaboration and accommodations in Southeast Asia. On the other hand, however, its increasingly assertive maritime actions since 2008-09 have aroused anxieties about the rising power’s long-term intentions in Asia. China’s construction of artificial islands and its ongoing militarization in the disputed areas—at the same as it actively promotes Xi’s BRI with pledges of peace, prosperity, and “common destiny”—have left the impression that the increasingly mighty China is pursuing a contradictory strategy.¹⁶ This has deepened the anxieties of many Southeast Asian states, not only claimants but also non-claimant countries, who are concerned about freedom and safety of navigation in the Asian waters. Some have become particularly frustrated with what they see as Beijing’s delaying strategy on the talks over the Code of Conduct (COC) in the South China Sea. Even though the majority of the ASEAN states have avoided openly criticizing Beijing both before and after the July 2016 arbitration ruling, there has been quiet unease among the weaker states.¹⁷

Beyond territorial issues, the genie of trust deficit has wandered into economic domains. China has been the largest trading partner of virtually all ASEAN states over the past few years, with expanding investment links. Despite the robust commercial cooperation, there is a widespread concern that deepening economic ties with China will end up with becoming over-dependent and losing autonomy. As Beijing’s BRI makes inroads into Southeast Asia through an array of infrastructure projects ranging from railways and roads to ports and pipelines, some have expressed concern about unfavorable financing terms, unsustainable practices, and other problems surrounding China-related projects. From Cambodia and Laos to Myanmar, Malaysia, and the Philippines, observers have warned that the massive influx of China’s funding into the Southeast Asian countries will turn them into the latest victims of “debt trap” after Sri Lanka.¹⁸ A Manila-based journalist cautioned: “Like Laos and Cambodia, the Philippines could become beholden to Beijing, preventing the exercise of a truly independent foreign policy.”¹⁹ A Vietnamese researcher observed that Hanoi is cautious about China’s BRI, because of “the lingering distrust between the two countries and rising anti-China sentiments in Vietnam due to recent tensions over the South China Sea disputes, especially following the 2014 oil rig crisis.”²⁰

What are the implications of the deepened trust deficit for Southeast Asia-China interactions and wider regional affairs? The impacts are two-fold: 1) on the South China Sea: The greater the trust deficit, the greater the tendency for most ASEAN states to engage in power-balancing, borrowing strength from external powers in order to constrain China’s security actions on the disputed areas; and 2) on regional responses to BRI: So long as the mistrust of China persists, China’s BRI push will continue to face skepticism and even resistance. The greater the trust deficit, the lower the regional receptivity to China-linked projects. 

The 3rd genie: The other powers’ activism gaps

The increasing activism of “the other powers” (mainly Japan and Australia, and to some extent, India, France, and Britain)—driven principally by their concerns about the heightened uncertainties surrounding the US commitment and/or China’s intentions—is generally welcomed by most Southeast Asian states, for the same reasons. Nevertheless, as the weaker states, the ASEAN countries’ responses are ambivalent. While they welcome the expanded opportunities to leverage the secondary powers’ growing activism for their own development and strategic gains, they remain wary of the multiple risks that come with it: the dangers of alienation, entrapment, and regional marginalization.

A key factor underlying these fears is the triple gaps inherent in these powers’ activism: 1) the hitherto unbridgeable gap between their current capabilities and their activism goals (constraining China’s security actions, complementing and retaining the US regional involvement, advancing their own interests); 2) the differences among the powers on how far they should “push back” against China, and through what means (e.g. the differences between Australia and Japan on the one hand, and India on the other, about the role of the Quad in the Indo-Pacific region, as discussed above);²¹ and 3) the supply-demand gap: while the weaker states in Southeast Asia demand an increase in the supply of security partnerships, they also demand an increase in the supply of infrastructure investment and financial backing; the latter, however, is not yet the prime focus of the secondary power activism. Thus far, Japan is the only player among the secondary powers which offers infrastructure funding (through the Partnership for Qualitative Infrastructure), as an alternative scheme to compete with China’s BRI. There has been talk about setting up infrastructure financing plans among the Quad, as well as between Japan and India, and between Japan and the United States, but none of these has been materialized.

In the eyes of the Southeast Asian states, these gaps reduce the appeal of the powers’ activism. The gaps increase the perceived multiple risks. Partnering too closely with these players (especially on domains appeared to be targeting China) risks antagonizing Beijing. Excessive push-back activities risk escalating tensions (between China and the United States, as well as China and other players), and risk turning “constrainment” into containment, which, would entrap weaker states into possible conflicts between the giants. Encouraging the other powers playing a greater regional role risks marginalizing ASEAN centrality and undermining its group unity. Hence the weaker states’ cautious responses to the secondary powers’ expanding activities in the region.

The best example to illustrate Southeast Asian states’ cautious responses—in the face of the three wildly wandering genies—is the weaker states’ selective, conditional, and mixed reactions to the Quad and the notion of the “Indo-Pacific,” the overarching policy frame of the powers’ activism. While most, if not all, ASEAN countries see eye-to-eye on the importance of leveraging competitive power-balancing dynamics to uphold the rules-based order and safeguard free and open international waters, they have refrained from embracing the Indo-Pacific concept completely and openly. Their responses are “selective” in that they are inclined to collaborate with the Quad countries only on domains that are positive-sum and inclusive in nature (as opposed to exclusive, threat-based, and targeted at a specific country), such as policy exchanges, capacity building, and asset modernization. They are “conditional” in that the Indo-Pacific collaboration should not be pursued at the expense of ASEAN centrality and unity. Finally, they are “ambiguous” in that the Southeast Asian states have reacted in a mixed and diffuse way in order to avoid locking themselves into any rigid commitment vis-à-vis any of the competing powers.

Take the responses of Singapore and Indonesia. Singaporean foreign minister Vivian Balakrishnan said at a public lecture organized by the IISS-Asia in May 2018 that Singapore would not join the Quad and would not sign on to the free and open Indo-Pacific strategy, because “the strategic concept does not adequately address if ASEAN could continue to be central to the region’s architecture, and whether multilateralism and the rule of law would remain the order of the day.”²² Indonesia, the ASEAN state most enthusiastic about the Indo-Pacific concept, has similarly stressed ASEAN centrality, while underscoring inclusivity and neutrality amid the fluid regional situation. At the 32nd ASEAN Summit in April 2018, President Jokowi presented Jakarta’s proposal on the Indo-Pacific concept to other Southeast Asian leaders, where he “urged ASEAN to strengthen its unity and take a central role in developing the framework of the Indo-Pacific strategy to move toward inclusive cooperation.”²³ Earlier, in her annual foreign policy speech in January 2018, Foreign Minister Retno Marsudi remarked that Indonesia would deploy its diplomacy “not only in the Asia-Pacific region, but also across the vast Indian Ocean,” adding that Indonesia, along with ASEAN, “will continue to contribute to the strengthening of positive and inclusive cooperation, and not cooperation based on suspicions or even threat perceptions.”²⁴

Indonesia’s embrace of the Indo-Pacific is understandable, given the archipelagic republic’s location between the vast Indian and Pacific Oceans, and given its president’s vision of developing Indonesia into a “global maritime fulcrum.” Other smaller Southeast Asian states may not hold the same level of enthusiasm about the Indo-Pacific, but they clearly share Indonesia and Singapore’s sensitivity about the risks associated with collaborating with the Quad members in light of the reduced US credibility and uncertain Chinese intention.