Southeast Asia is increasingly central to a complex web of geopolitical and economic competition, particularly between the United States and China. A recent forum hosted by the London School of Economics and Political Science highlighted the intensifying “geoeconomic” rivalry and “weaponized interdependence” shaping the region, with implications for economies, political systems, and societies across the Association of Southeast Asian Nations (ASEAN).
The growing contestation isn’t limited to traditional diplomatic or military spheres. It extends to critical infrastructure projects – from large-scale transportation networks to vital submarine fiber-optic cables – and increasingly, to the supply chains for essential technologies like semiconductors. The incoming Trump Administration, as discussed at the forum, is expected to further escalate trade disputes and the “chip war” with China, adding another layer of complexity to the regional landscape.
Southeast Asia as a Key Arena for Geoeconomic Competition
Experts convened at the Southeast Asia Forum in May 2025 to analyze these trends. The forum, organized by the LSE Saw Swee Hock Southeast Asia Centre, brought together specialists to discuss the implications of global shifts for the region. A key focus was China’s growing economic influence in Southeast Asia, particularly through infrastructure investment. Evelyn Goh, of the Australian National University, presented research on how this investment impacts regime security in the region, noting that it creates both opportunities and strategic concerns.
Since the 1990s, Southeast Asia’s economic ties with China have deepened, leading to increased dependence on Chinese investment in both infrastructure and industry. This has generated political debate about the extent of China’s influence on Southeast Asian politics and societies. The assumption is that such investment creates leverage for China, though the precise nature and extent of that influence remain a subject of ongoing analysis.
Beyond Infrastructure: The Expanding Scope of Contestation
The geoeconomic competition extends beyond large-scale infrastructure projects. It encompasses critical digital infrastructure, such as transoceanic submarine fiber-optic cable links, and the increasingly vital semiconductor supply chains. These areas are becoming focal points for strategic maneuvering as nations seek to secure their economic and technological futures. The potential for further escalation of trade disputes, particularly concerning semiconductors, adds to the uncertainty.
Recent analysis from the East Asia Forum highlights the multifaceted nature of these economic dynamics. Articles published in March 2025 discuss topics ranging from China’s selective anti-scam campaign and its paradoxical effects on Southeast Asia to Thailand’s political landscape and the broader implications of Chinese investment for economic security in the region. East Asia Forum provides ongoing coverage of these developments.
Navigating a Connected and Contested World
A report by McKinsey & Company, published on March 14, 2025, underscores the interconnected yet contested nature of the global order. The report notes that ASEAN member states, collectively representing the world’s fifth-largest economic bloc, are emerging as key connectors in a reconfiguring global trade landscape.
The LSE forum also addressed the broader implications of these trends for Southeast Asian economies and societies. Discussions centered on how regional actors can navigate this complex environment, balancing economic opportunities with strategic considerations. The forum schedule included opening remarks by John T. Sidel and a presentation by Henry Wai-chung Yeung of The Chinese University of Hong Kong.
Looking ahead, the geoeconomic contestation in Southeast Asia is likely to intensify. The interplay between major powers, the evolving dynamics of global supply chains, and the internal political and economic developments within ASEAN member states will continue to shape the region’s trajectory. Monitoring these developments will be crucial for understanding the future of the Indo-Pacific region and the global economy.
What are your thoughts on the increasing geoeconomic competition in Southeast Asia? Share your insights in the comments below.
