Engaging Southeast Asia in a Time of Flux

November 17, 2016

Welcome to our rebooted Southeast Asia from Scott Circle newsletter. The newsletter will continue to bring you commentary about U.S. engagement with Southeast Asia and highlights of key developments in the region on a biweekly basis. We are also consolidating our SitRep announcements and program highlights into this one regular update.

I owe a huge debt of gratitude to my predecessor, Ernest Z. Bower, who launched this newsletter seven years ago and built the Southeast Asia program at CSIS into a formidable platform for sustaining high-level policy focus on Southeast Asia. As many of you know, I joined CSIS in June to lead this program, and my overriding goal is to maintain the spotlight on Southeast Asia in Washington, D.C.

This focused attention is more critical than ever during this time of transition to a new U.S. administration, one that may well have very different foreign policy priorities and perhaps a distinctive approach to Asia and the world. Donald Trump was an unconventional candidate who ran an unconventional campaign, and while some of his views on foreign policy are well known, it remains to be seen how his campaign rhetoric on trade and alliances will translate into actual policies.

As of this writing, his foreign policy team has not yet been announced, making it difficult at this point to make predictions about whether a Trump administration will maintain the basic contours of Asia policy that have guided both Democratic and Republican administrations for decades, or whether the new president will question traditional assumptions and seek to chart a new course for U.S.-Asia relations.

This uncertainty is creating some understandable and palpable anxiety in the region. Moreover, this political transition in the United States is occurring at a time of unusually high flux and uncertainty in the region itself. Domestic political developments in several Southeast Asian countries have reshuffled their priorities and alignments and raised questions about the future trajectory of the region.

In the Philippines, President Rodrigo Duterte has sought rapprochement with China over maritime disputes in the South China Sea and has signaled a shift in U.S.-Philippine relations, including scaling back joint military exercises and other forms of cooperation. Malaysia has also moved toward closer defense and economic ties with China at a time when Prime Minister Najib Razak remains mired in the 1Malaysia Development Berhad (1MDB) corruption scandal.

Meanwhile, Thailand is in the third year of military rule since the overthrow of its civilian government in May 2014—the second coup in a decade—and deeply mourning the loss of their beloved King Bhumibol Adulyadej. Indonesian president Joko Widodo continues to focus heavily on domestic policies rather than exerting Indonesia’s traditional influence over regional affairs. In many ways Myanmar is a bright spot in the region as it continues its remarkable political transition under Aung San Suu Kyi’s leadership, yet formidable obstacles to full democratization and reconciliation remain.

These internal dynamics in Southeast Asian countries have created a leadership vacuum in ASEAN, causing drift and divisions within the organization, particularly over the issue of how to respond to China’s increasingly assertive behavior in the South China Sea. Whether ASEAN can maintain its centrality without unity is an increasingly relevant question. Overt friction in the South China Sea has eased in recent months, but the underlying tensions and concerns about China’s behavior remain and will continue to drive the strategic calculus of claimants and other countries in the region.

There is also growing uncertainty about the emerging economic landscape in Asia. Although the economic prospects of many Southeast Asian countries look bright—particularly for Vietnam, the Philippines, and Indonesia—the region relies heavily on trade and access to global markets. Yet global trade has been declining since 2007, and the failure of trade talks— including what looks now to be a failed effort to launch the Trans-Pacific Partnership (TPP), which would have linked the United States with 11 Asia-Pacific trade partners—raises questions about the ability of countries in the region to get back on track with trade liberalization.

Certainly, it raises profound questions about American economic and strategic leadership in Asia. Whether the collapse of TPP will inject momentum into regional negotiations led by China and ASEAN for a Regional Comprehensive Economic Partnership (RCEP) remains to be seen. It is also unclear how meaningful an RCEP deal would be in terms of trade liberalization and economic integration. But key countries, including the Asian TPP signatories as well as China, are likely to want to fill the economic void created by TPP’s demise.

In short, we are entering a period of strategic flux as policy shifts on both sides of the Pacific may reshuffle economic and security alignments. It is worth keeping in mind that America’s interests in Asia are deeply rooted and enduring. There remains tremendous economic opportunity in Southeast Asia for U.S. businesses and workers. Many American states that supported Trump remain tied to agricultural exports that depend on access to world markets.

And, according to recent Pew and Chicago Council on Global Affairs polls, Americans continue to favor free trade by a large margin. Moreover, the strategic stakes for U.S. engagement in Southeast Asia, and for upholding a rules-based order that preserves peace and prosperity for everyone in the region, remain extremely high. These kinds of strong national interests tend to win out in the end, although the twists and turns of U.S. policy developments in the short run in a Trump administration are harder to predict.

In this critical moment as we begin the next chapter of U.S.-Asia relations, the CSIS Southeast Asia program remains committed to bringing you our assessment of the latest developments and emerging trends in the region, and providing policy analysis and recommendations as president-elect Trump and his team begin the task of policy formulation. Now more than ever, close communication and exchange of ideas and perspectives across the Pacific are needed to inform policy choices and maintain strong ties, and we will strive to further strengthen and highlight this dialogue.

(This Commentary originally appeared in the November 17, 2016, issue of Southeast Asia from Scott Circle.)

Amy Searight is senior adviser and director of the CSIS Southeast Asia Program at the Center for Strategic and International Studies in Washington, D.C.

Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2016 by the Center for Strategic and International Studies. All rights reserved.