As Americans grapple with the aftermath of the November 2024 presidential elections, Southeast Asia stands at the critical nexus of its fallout, confronting a new and uncertain geopolitical reality. As Donald Trump returns to the White House, it marks a pivotal moment for the region. Trump’s “America First” policies, characterized by heightened protectionism, volatile diplomacy, and diminished multilateral engagement, are poised to disrupt the delicate balance Southeast Asia has maintained between the United States and China. His proposed 60% tariffs on Chinese imports threaten to upend regional supply chains, while the likely rollback of U.S. commitments to green energy partnerships risks derailing critical climate transitions in countries like Indonesia and Vietnam.
At the same time, the intensification of US-China tensions under the Trump administration could force the Association of Southeast Asian Nations (ASEAN) into the unwelcoming position of choosing sides in a geopolitical contest they have long sought to navigate neutrally. As these challenges mount, it is clear that Trump’s policies will reshape Southeast Asia’s economic, geopolitical, and environmental landscape, with consequences that will ripple far beyond the region. In a world increasingly defined by power shifts and fractured alliances, understanding Southeast Asia’s response to Trump 2.0 offers critical insight into the future of global stability.
The Strategic Bridge Between East and West
Historically, U.S. engagement with Southeast Asia has been characterized by alternating waves of strategic focus and disengagement. Under Barack Obama, the “Pivot to Asia” sought to reassert U.S. leadership through economic initiatives like the Trans-Pacific Partnership (TPP), which was poised to encompass 40% of global GDP and establish high standards for trade, labor, and environmental practices. However, Trump’s first term abandoned multilateralism in favor of transactional diplomacy, withdrawing from the TPP and sidelining broader economic frameworks. In contrast, Biden’s Indo-Pacific Economic Framework (IPEF) aimed to re-engage the region, though its limited scope—focusing on digital trade and supply chain resilience without tariff reductions—failed to match the ambitions of its predecessors.
The geopolitical balancing act in Southeast Asia hinges on its dual reliance on the U.S. for security and China for economic integration. U.S. security guarantees, especially through defense treaties with the Philippines and Singapore, play a critical role in deterring aggression and maintaining regional stability. At the same time, China’s Belt and Road Initiative (BRI) has entrenched Beijing’s economic influence, funding vital infrastructure projects and fostering trade dependencies in nations like Malaysia, Indonesia, and Vietnam. This dual reliance places Southeast Asia in a precarious position as U.S.-China tensions intensify, forcing the region to navigate an increasingly fraught geopolitical landscape.
Geopolitically, Southeast Asia remains the linchpin of the Indo-Pacific, vital for maintaining global trade flows and ensuring regional security. Its strategic location links the Pacific and the Indian Ocean, making it a critical gateway for global commerce and energy supplies. Yet, the South China Sea—through which $3.4 trillion in annual trade flows—remains a volatile flashpoint, with China’s territorial claims and militarization of artificial islands clashing with international norms. Meanwhile, ASEAN’s energy transitions—crucial for combating climate change—are precariously dependent on international financing and cooperative frameworks like the Just Energy Transition Partnerships (JETPs). Trump’s expected rollback of climate funding and disengagement from multilateralism could derail these initiatives, compounding the region’s environmental and economic vulnerabilities.
Walking the Tightrope: Southeast Asia Amid Trump’s Second Act
Trump’s renewed promises of imposing sweeping tariffs on all Chinese imports is a move designed to decouple U.S. supply chains from China. These measures, while ostensibly aimed at protecting American industries, are poised to send shockwaves through global trade, with Southeast Asia positioned both as a potential beneficiary and collateral damage. During Trump’s first term, tariffs of up to 25% drove a wave of Chinese manufacturers to relocate operations to Vietnam, Malaysia, and Thailand, spurring short-term gains for these nations through increased foreign direct investment and export activity.
However, the scope and intensity of the proposed tariffs threaten to amplify the risks for Southeast Asia. Chinese exporters, unable to access the U.S. market directly, may flood Southeast Asian economies with excess goods, triggering anti-dumping concerns and undermining local industries. At the same time, while nations like Vietnam might attract additional manufacturing as companies seek tariff-avoidance strategies, the classification of these countries as “nonmarket economies” could expose them to higher U.S. tariffs, nullifying their competitive edge.
The specter of secondary tariffs targeting goods routed through Southeast Asia—an approach championed by Trump’s China hawks—raises significant uncertainty for the region’s role in global supply chains. These measures threaten to undermine Southeast Asia’s emerging status as a manufacturing hub, particularly in high-value sectors like electric vehicle production in Thailand and semiconductor manufacturing in Malaysia. Higher trade costs and logistical challenges could disrupt these industries, deterring multinational firms from investing further in the region. Moreover, while Southeast Asia has been a significant beneficiary of supply chain realignment amidst U.S.-China tensions, Trump’s aggressive protectionist measures risk blunting this advantage. For instance, stricter scrutiny and potential reclassification as a transshipment risk could discourage foreign direct investment in Malaysia’s semiconductor industry and beyond, prompting firms to favor markets with more predictable regulatory environments.
In the broader context, this heightened risk environment threatens to undermine Southeast Asia’s economic resilience and competitiveness. By discouraging supply chain diversification, these policies could slow the region’s growth, particularly as global trade volumes adjust to a more fragmented system. This risk, compounded by weak global demand and increased trade tensions, underscores the precarious balance ASEAN economies must maintain to remain attractive investment destinations in the face of growing protectionism.
In this intensified U.S.-China rivalry, Southeast Asia faces a stark dilemma: capitalize on the opportunities presented by trade realignment or suffer economic repercussions from protectionist policies and weakened global demand. As regional leaders scramble to navigate this precarious landscape, they must weigh the short-term benefits of increased manufacturing activity against the long-term risks of economic dependency and retaliatory trade measures.
Additionally, the return of Donald Trump brings renewed uncertainty to Southeast Asia’s security landscape, particularly regarding U.S. commitments in the region. During his first term, Trump often prioritized immediate economic or political gains over traditional alliance-building, a trend expected to intensify during his second term. This approach, while benefiting certain bilateral engagements, left US allies like the Philippines grappling with strategic ambiguities. For instance, while Trump reaffirmed defense commitments under the U.S.-Philippines Mutual Defense Treaty, he also expressed frustration with the costs of maintaining military bases and questioned the broader value of some longstanding alliances.
The Philippines finds itself in a precarious position as regional tensions escalate in the South China Sea. The Philippines has been at the forefront of maritime disputes with China, facing frequent confrontations and territorial intrusions by Chinese vessels. While Manila seeks to leverage U.S. security guarantees, the unpredictability of Trump’s approach raises concerns about the reliability of American support in the event of heightened conflict. Philippine officials have highlighted the importance of multilateral approaches to regional security, emphasizing partnerships with nations like Japan and Australia to counterbalance any perceived U.S. disengagement.
Accordingly, Trump’s focus on “America First” policies will complicate Southeast Asia’s strategic landscape as his second administration is expected to prioritize economic and security concerns over traditional alliance mechanisms or collective defense commitments, potentially emboldening Beijing’s assertiveness in the South China Sea. China has already taken advantage of regional uncertainties to solidify its claims, intensifying its military presence and conducting large-scale exercises in disputed waters.
The implications for regional stability are profound. Without assured U.S. backing, Southeast Asia risks becoming a stage for heightened U.S.-China rivalry, with individual nations forced to hedge or align more closely with Beijing. For countries like the Philippines, which rely heavily on U.S. security assurances, this unpredictability raises the issue of strategic vulnerability in the face of Chinese assertiveness. Thus, Trump’s transactional diplomacy and the anticipated recalibration of U.S. commitments under his administration signal a critical juncture for Southeast Asia’s security calculus.
Furthermore, Trump 2.0 will bring significant challenges to Southeast Asia’s energy transition and global climate goals. Trump’s withdrawal from the Paris Agreement during his first term deprioritized international climate cooperation, actions which created a leadership vacuum that China has sought to fill. As Trump returns to D.C., his likely rollback of U.S. commitments to climate initiatives threatens critical financing for Southeast Asia’s efforts to transition away from coal dependency. The withdrawal from multilateral climate frameworks could severely restrict the $20 billion in pledged investments under these partnerships.
Trump’s prioritization of fossil fuels—reflected in his “drill baby, drill” rhetoric and planned deregulation of the energy sector—further complicates Southeast Asia’s ambitions for clean energy development. His administration is expected to scale back programs like the Inflation Reduction Act (IRA), which has been a key driver of U.S. global clean energy investments. Southeast Asia, which requires significant external funding to harness its solar and wind potential, will likely face funding shortfalls as U.S. investment shifts inward.
China is poised to capitalize on this vacuum. Its dominance in renewable energy technologies, particularly in solar panel manufacturing and electric vehicles, positions Beijing as the primary alternative partner for Southeast Asia’s energy transition. Already, Chinese companies command over 70% of the region’s electric vehicle market, and their influence in renewable energy financing is unmatched. However, this dependence raises concerns about over-reliance on a single global power, particularly in a region striving for strategic autonomy.
The potential loss of U.S. support also jeopardizes global climate goals. Southeast Asia, with its abundant reserves of critical minerals like nickel and rare earths, plays a pivotal role in the global supply chain for renewable energy technologies. Without robust international collaboration, these resources may be exploited in ways that undermine sustainability and economic equity.
China’s Regional Playbook Under Trump 2.0
China is likely to capitalize on the unpredictability of U.S. foreign policy under Trump 2.0 to strengthen its foothold in Southeast Asia. Trump’s transactional diplomacy and potential disengagement from multilateral frameworks present Beijing with a prime opportunity to expand the BRI. Through extensive infrastructure projects—such as railways, ports, and digital networks—the BRI has already established China’s economic influence across the region. These investments not only address critical infrastructure needs but also advance Beijing’s strategic agenda by fostering economic reliance and drawing regional governments closer to its sphere of influence.
The region’s skepticism about U.S. reliability, exacerbated by Trump’s erratic policies, may drive countries like Malaysia, Indonesia, and the Philippines to deepen economic and political ties with Beijing. This trend is expected to intensify as countries like Malaysia and Indonesia turn to Chinese investments in railways, ports, and digital infrastructure to bridge their economic gaps, particularly amid fears of U.S. disengagement from the region. Additionally, the New Development Bank (NDB) associated with BRICS offers an alternative financial resource that aligns with the Global South’s push for greater economic autonomy, creating another avenue for Beijing to strengthen its influence.
In addition to its economic strategies, China is likely to bolster its military presence in the South China Sea to capitalize on Trump’s potential ambivalence toward multilateral security arrangements. Beijing’s “salami-slicing” strategy—incrementally advancing territorial claims through militarized artificial islands and coast guard patrols—could intensify. Without robust U.S. commitments to counterbalance Chinese maneuvers, regional nations may find themselves increasingly reliant on Beijing to maintain stability, furthering China’s strategic ascendancy.
In addition, China’s technological dominance presents another avenue for influence. Southeast Asia’s growing demand for renewable energy, 5G networks, and electric vehicles aligns with China’s global leadership in these sectors. Investments in green technologies and digital infrastructure, particularly underpinned by Chinese state-backed enterprises, could fill the void left by potential U.S. climate disengagement under Trump. For example, as the United States scales back its support for renewable energy initiatives, China could extend its reach through renewable energy exports and financing, further entrenching its economic ties in the region.
By leveraging its comprehensive strategy, China aims to consolidate its position as the dominant power in Southeast Asia, capitalizing on opportunities presented by U.S. unpredictability. These dynamics not only reshape the balance of power in the Indo-Pacific, but also redefine Southeast Asia’s economic and security landscape in a post-Trump global order.
Surviving and Thriving Under Trump 2.0
As Donald Trump embarks on his second presidency, Southeast Asia must confront the dual challenges of U.S. unpredictability and intensifying U.S.-China rivalry by pursuing a multi-pronged strategy to diversify partnerships, strengthen regional unity, and build domestic resilience. Over-reliance on the U.S. for security and China for trade exposes the region to disproportionate risks, making strategic recalibration essential for its stability and prosperity in an era of shifting global dynamics.
Alternative global powers like the European Union (EU), Japan, and Australia offer Southeast Asia avenues to hedge against this dependency. The EU’s focus on sustainable development and trade liberalization aligns with ASEAN’s aspirations for balanced growth. The recently ratified EU-Vietnam Free Trade Agreement (EVFTA) exemplifies the potential for deepened economic ties that emphasize high standards in labor and environmental practices, creating a blueprint for future agreements with other ASEAN members.
Japan’s strategic vision under the “Free and Open Indo-Pacific” framework complements Southeast Asia’s balancing act by providing significant infrastructure investments and technological collaboration without overt geopolitical strings. Tokyo’s commitment to renewable energy projects, such as Indonesia’s geothermal plants, offers a counterbalance to China’s BRI while fostering sustainable development.
Australia, too, plays a pivotal role, particularly as a partner in defense and education. Its partnerships with ASEAN nations on maritime security and its leadership in Quad-related initiatives provide Southeast Asia with additional security assurances amid uncertainties in U.S. commitments under Trump. These collaborations ensure a multipolar balance that can dilute the destabilizing effects of the U.S.-China rivalry.
As Trump’s policies deepen geopolitical fragmentation, strengthening ASEAN’s unity is more critical than ever for navigating external pressures. Historically, the bloc’s principle of non-alignment has allowed it to balance superpower rivalries while maintaining regional cohesion. However, Trump’s transactionalism and China’s assertive maneuvers risk exploiting internal divisions, threatening to erode ASEAN’s collective influence and its ability to act as a stabilizing force in the Indo-Pacific.
ASEAN must advocate for multilateral solutions, particularly in the South China Sea, where a binding Code of Conduct (CoC) is urgently needed. A unified ASEAN stance would not only constrain China’s unilateral actions but also strengthen the bloc’s credibility as a stabilizing force in the Indo-Pacific. Multilateral platforms like the ASEAN Regional Forum (ARF) and the East Asia Summit (EAS) should be revitalized to engage external powers in dialogues that prioritize regional stability over narrow national interests.
Moreover, ASEAN’s institutional capacity needs bolstering to address emerging challenges like digital transformation and climate change. Establishing centralized mechanisms for regional energy transition funding, modeled on the European Green Deal, would reduce reliance on external financing and promote sustainable development. Additionally, enhancing disaster response capabilities through joint task forces can address vulnerabilities exacerbated by climate disengagement under Trump 2.0.
Trump’s protectionist trade policies and potential withdrawal from climate initiatives highlight the strategic necessity for Southeast Asia to build domestic resilience. Investments in local industries, particularly in sectors like electronics, manufacturing, and agriculture, can mitigate the economic fallout from disrupted global supply chains. Countries like Vietnam, which have benefited from trade realignment during previous tariff wars, should leverage these advantages by enhancing value-added production and reducing dependency on foreign inputs.
Renewable energy presents another critical area for capacity building. Southeast Asia’s abundant resources—solar, wind, and geothermal—offer the potential to become a leader in the green energy transition. However, the region’s progress is heavily reliant on external funding through initiatives like the JETPs. With Trump’s climate disengagement threatening these flows, ASEAN nations must prioritize public-private partnerships and domestic investments to accelerate energy diversification and reduce coal dependency. Indonesia’s and the Philippines’ geothermal energy projects, as well as Vietnam’s solar initiatives, serve as models for scaling up regional renewables while fostering local job creation and technological innovation.
Furthermore, governments must invest in workforce upskilling to prepare for an increasingly digitized global economy. By fostering local expertise in emerging sectors like electric vehicles and semiconductors, Southeast Asia can reduce its vulnerability to external shocks and position itself as a critical player in future global supply chains.
Adapting to the Era of Global Uncertainty
The tumult of Trump’s second term offers a sobering lesson for Southeast Asian policymakers: resilience and strategic foresight are no longer optional—they are imperative. The region’s reliance on external powers for security, trade, and climate funding has exposed vulnerabilities that Trump’s policies will likely exacerbate. U.S. protectionism and China’s growing dominance underline the need for Southeast Asia to reassess its economic dependencies and security alliances.
Policymakers must recognize that a fragmented global order requires adaptable strategies. The diversification of partnerships with alternative powers such as the EU, Japan, and Australia provides an essential buffer against U.S.-China tensions. Strengthening ASEAN unity is equally vital, as a cohesive bloc can wield greater influence in negotiations and serve as a stabilizing force in regional disputes. Finally, investments in domestic capacity—be it in renewable energy, high-tech manufacturing, or workforce development—can mitigate the impact of external shocks and empower the region to assert its autonomy in a multipolar world.
This moment also demands bold leadership. The region cannot afford to react passively to external pressures. Instead, policymakers must anticipate shifts, craft innovative solutions, and leverage Southeast Asia’s collective bargaining power to secure favorable outcomes in a rapidly changing geopolitical landscape.
Southeast Asia stands at a crossroads. The challenges posed by Trump 2.0 are formidable, but they are also an opportunity for the region to redefine its role in the global order. ASEAN and its member states must take proactive steps to ensure their voices are not sidelined in the U.S.-China rivalry. This requires moving beyond traditional strategies of hedging and neutrality to embrace a more assertive and forward-looking approach.
Finally, the region must focus inward to build resilience. Investing in renewable energy and sustainable industries can reduce dependency on volatile external funding while positioning Southeast Asia as a leader in the global energy transition. Furthermore, fostering innovation and enhancing workforce skills will ensure that the region remains competitive in the face of changing global trade dynamics.
Trump 2.0 is not just a challenge; it is a test of Southeast Asia’s ability to adapt, innovate, and lead. In the multipolar era of unpredictability, the region’s strategic choices today will determine its trajectory for decades to come. By embracing a proactive and unified strategy, Southeast Asia can transform this moment of uncertainty into an opportunity for long-term stability and growth. The world is watching, and Southeast Asia must rise to the occasion.
Featured Image: Asia Times
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