Historical context is crucial. Beginning in the early 21st century, China’s “Belt and Road Initiative” (BRI), initially framed as a cooperative investment program, rapidly evolved into a vehicle for projecting its economic and political influence across Asia. The ASEAN Regional Forum, established in 1996, initially served as a platform for dialogue, but China’s growing participation and the scale of its investments – particularly in infrastructure projects – have demonstrably shifted the dynamics. Preceding events, such as the 2019 territorial dispute in the South China Sea and the resulting sanctions, cemented a pattern of assertive diplomacy and economic pressure used to advance Beijing’s strategic goals. The 2023 Cambodian election, marked by significant Chinese investment and political support, highlighted the evolving vulnerability of nations within the region to Beijing’s sway.
Key stakeholders are now deeply entrenched. China’s motivations are multifaceted: securing access to vital resources, expanding its maritime trade routes, and positioning itself as the dominant economic power in Asia. Simultaneously, Beijing seeks to erode US influence, undermine regional governance structures, and ultimately, reshape the international order. ASEAN member states – Indonesia, Malaysia, the Philippines, Singapore, and Vietnam – face a critical dilemma: leverage China’s economic benefits – infrastructure development, trade opportunities – while mitigating the risks associated with Beijing’s growing dominance and potential for coercion. The United States, under the Biden administration’s “Indo-Pacific Strategy,” seeks to counter China’s influence through strengthened alliances, increased military presence, and diplomatic engagement, although recent budgetary constraints and domestic political divisions have hampered the strategy’s effectiveness. “The challenge isn’t just military,” explains Dr. Anya Sharma, Senior Fellow for Geopolitics at the Singapore Institute of International Studies. “It’s fundamentally about demonstrating a credible alternative – a robust and inclusive regional architecture that addresses the developmental needs of Southeast Asia without imposing conditions tied to Beijing’s geopolitical agenda.”
Data paints a concerning picture. According to the World Bank’s 2025 report on infrastructure investment in Southeast Asia, Chinese financing accounts for over 60% of all projects, a dramatic increase from 15% a decade prior. Debt-to-GDP ratios for several nations, including Laos and Cambodia, are already dangerously high, largely due to BRI loans. Furthermore, independent analysis by the Center for Strategic and International Studies (CSIS) indicates a 35% increase in Chinese naval activity within the First Island Chain over the past five years, effectively extending Beijing’s reach into strategically important maritime areas. Below illustrates this trend:
Chinese Naval Activity in the First Island Chain (2021-2026)
The “5S” Foreign Affairs Masterplan, launched in 2020, represents Thailand’s calculated response – focusing on strategic diversification of partnerships, strengthening economic resilience, and bolstering regional security cooperation. The country’s presentation at the APFSD, advocating for a coordinated approach to sustainable development, underscored a desire to maintain a neutral stance while promoting responsible engagement. “Effective multilateralism is not about aligning with one power,” stated Vice Minister Isarabhakdi. “It’s about fostering an environment of mutual respect and shared prosperity.”
Short-term (next 6 months): We anticipate continued expansion of Chinese influence in infrastructure projects, exacerbated by the ongoing economic slowdown in the West. Increased pressure on vulnerable ASEAN nations through debt diplomacy and potentially, through leveraging their dependence on Chinese trade. The Philippines, facing intensifying territorial disputes with China in the South China Sea, could be a flashpoint. Long-term (5-10 years): The trajectory depends heavily on the evolution of US-China relations. A further deterioration in relations could lead to a more pronounced “cold war” scenario in Asia, fragmenting the region into competing spheres of influence. Conversely, a negotiated détente might allow for a more stable and predictable geopolitical environment, albeit one still heavily influenced by China’s economic power. However, the increasing militarization of the South China Sea and the potential for miscalculation remain potent threats. The challenge will be to build a genuinely inclusive regional order that balances economic development with strategic stability. “The future of Southeast Asia hinges on the ability of nations to navigate this complex landscape with foresight and a commitment to diplomacy,” concludes Professor Li Wei of Peking University’s School of International Studies. “The potential for a constructive dialogue, however, remains, if both sides acknowledge the limitations of their respective ambitions.” The question remains – will Southeast Asia become a battleground for great power rivalry, or can it forge a path toward a future of shared prosperity and regional security?