The Better Way Forward for Southeast Asia Caught in the US-China Tussle

Instead of forced geopolitical choices, a development strategy of 'structured deconfliction'—practical steps to avoid working at cross-purposes—is both achievable and necessary.

- Daniel Russel and Blake Berger

President Xi Jinping's recent visits to Vietnam, Malaysia, and Cambodia showcase China's sustained engagement with Southeast Asia. These trips by the Chinese leader, coming at a time of mounting global uncertainty, signal that Beijing is doubling down on the region as a strategic priority.

At the same time, regional leaders are quietly expressing concern about the other side of the ledger—the ripple effects of massive US tariffs, a shift towards protectionism and the dismantling of USAID programmes that have long supported valuable development partnerships.

These shifts highlight a strategic realignment in Southeast Asia's development landscape, with external players increasingly seen as pursuing a destructive rivalry, while local priorities risk being sidelined.

In our recently released report, Development as Strategy: The United States, China, and the Global South (Asia Society Policy Institute, 2025), we draw on more than a year of closed-door dialogues that brought together senior US and Chinese development experts—a mix of former government officials and prominent scholars—along with a spectrum of practitioners and policymakers from Southeast Asia and Africa.

Those conversations revealed how regional governments are navigating the intensifying great power competition. The message was consistent: Southeast Asia is focused on tangible investment, infrastructure upgrades, workforce skills, public health resilience and digital capacity—not ideological contests.

Development assistance is judged by whether it delivers these outcomes—not by whose flag it bears.

Many regional stakeholders welcomed China's swift financing and acknowledged that Chinese-backed infrastructure fills urgent gaps. But they also expressed doubts about the long-term sustainability of some projects, concerns about debt and transparency shortfalls and dissatisfaction with inadequate technology and skills transfer to local populations.