[New Year Special Commentary Series - EAI Korean Diplomacy 2021: Prospects and Strategies] VI. Southeast Asia as the Core Space of the US Indo-Pacific Strategy in 2021: Prospects and Our Considerations

Editor's Note

In this sixth commentary of the New Year Special Commentary Series, "EAI Korean Diplomacy 2021: Prospects and Strategies," Professor Park Jae-jeok (Graduate School of International and Area Studies, Hankuk University of Foreign Studies) emphasizes the need to focus on the US-led security network as the core of the US Indo-Pacific strategy and forecasts that the Biden administration will face numerous obstacles in implementing its Indo-Pacific strategy in Southeast Asia. He suggests the need to engage 'swing states' that defer their choices between the US and China, promote democratic values and human rights, and address Southeast Asian countries' expectations for assistance from both the US and China in vaccine procurement and post-COVID economic recovery. The author argues that South Korea must make its decisions by comprehensively considering the unfolding of the US Indo-Pacific strategy in Southeast Asia in 2021, the extent of the US's demand for South Korea's participation in its Indo-Pacific strategy, and the situation of US-China military confrontation in Southeast Asia.

The Biden Administration's Indo-Pacific: Strategy: Inherited Assets and

The Biden administration, set to launch on January 20, 2021, is expected to inherit the Trump administration's Indo-Pacific (hereafter, IP) strategy. Although the prevailing forecast is that the Biden administration will not exert pressure on China across the board as the Trump administration did, this is a relative perspective. As both the Republican and Democratic parties in the US unanimously recognize China's military rise, intellectual property theft, and industrial espionage as significant threats to US national interests, the sharp strategic competition between the US and China will continue under the Biden administration. Moreover, while the US's IP strategy is closely linked to its China strategy, it is inherently a 'regional strategy' with its own self-sustaining power, not a strategy directed solely at China. With various economic, military, and demographic indicators projecting the IP region as the strategic and economic axis of the 21st-century world, the Trump administration's IP strategy will continue under the Biden administration (albeit under a different name).

What warrants attention is that the US-led security network is the core of the US IP strategy. This network comprises alliances with South Korea, Japan, Australia, Thailand, and the Philippines, as well as partnerships with security cooperation countries such as Singapore, Vietnam, and India. The US has focused on strengthening this network through layered, multi-stakeholder linkages among its members. Meanwhile, the Trump administration's explicit expansion of the regional space from Asia-Pacific to Indo-Pacific brought India to the forefront of the US-led security network. As evidenced by the 'Basic Exchange and Cooperation Agreement (BECA)' signed in October 2020 for sharing military geospatial information, the bilateral security relationship between India and the US has rapidly advanced. India is also enhancing security cooperation not only with the US but also with Pacific nations like Australia, Japan, and the Philippines. Along with India in South Asia, Japan in Northeast Asia and Australia in the South Pacific are also positioning themselves as key nodes in the US IP security network. The revival of the 'Quadrilateral Security Dialogue (Quad)' among the US, Japan, Australia, and India in November 2017, which initially launched in 2007 under the leadership of the US and Japan but collapsed within a year due to Australia and India's withdrawal, and Australia's participation in the 'Malabar' naval exercises involving the US, India, and Japan in November 2020, clearly demonstrate that India, Japan, and Australia have become regional hubs within the US-led security network. Furthermore, Western countries like France and the United Kingdom are expanding their operational scope in the vast IP space, which combines the Indian and Pacific Oceans. France, whose Exclusive Economic Zone (EEZ) is 85% in the Indian Ocean due to territories acquired during its imperial era, led the launch of a vice-ministerial trilateral strategic dialogue with Australia and India in September 2020. The UK has maintained the 'Five Power Defence Arrangements' with Commonwealth nations Australia, New Zealand, Malaysia, and Singapore since 1971. Recently, it has rapidly advanced security cooperation with Japan and actively participated in US-led 'freedom of navigation' operations in the South China Sea. A press release issued by Japan after the Quad ministerial meeting held in Tokyo in October 2020 welcomed the efforts of some European countries towards a 'free and open Indo-Pacific'.

While the Trump administration has thus handed over a strengthened and expanded US-led security network to the Biden administration, it has also left challenges that need to be addressed for the US to effectively pursue its IP strategy. Firstly, the Trump administration's IP strategy was heavily tilted towards security aspects, neglecting the geo-economic dimension. President Trump withdrew from the 'Trans-Pacific Partnership (TPP)' negotiations in 2017, whereas China, in contrast, led the conclusion of the 'Regional Comprehensive Economic Partnership (RCEP)' in November 2020. Furthermore, China is investing vast capital in infrastructure construction in regional countries under the banner of the 'Belt and Road Initiative (BRI)'. The Trump administration failed to provide a comparable alternative capital. Of course, the US has also been attracting investment funds through 'Public-Private Partnerships' since Secretary of State Mike Pompeo announced in Washington on July 30, 2018, that new investment commitments totaling $113 million would be provided at the 'Indo-Pacific Economic Forum.' It is also collaborating with Australia, Japan, and India in bilateral or trilateral formats to increase investment scale. The US-Japan-Australia Indo-Pacific 'Trilateral Infrastructure Fund' established in 2018, and the US-Japan-India 'Trilateral Infrastructure Working Group' and 'Trilateral Infrastructure Forum' are representative examples. However, the investment scale by Quad countries remains significantly small compared to the substantial investment capital pledged by China. Although Quad countries have discussed infrastructure investment in their eight official meetings since the Quad's revival in November 2017 and proposed the establishment of the 'Blue Dot Network' in 2019, they have not presented a blueprint for a substantial increase in investment scale.

Secondly, while President Obama attended the 'East Asia Summit (EAS)' annually during his eight-year term, except for the federal government shutdown in 2013, President Trump did not attend the EAS during his entire term. He also skipped the ASEAN-US Summit for three consecutive years after his first year in office. When National Security Advisor Robert O'Brien attended in his place, ASEAN leaders likely felt considerable displeasure. In summary, the Biden administration has been launched with the tasks of establishing a geo-economic mechanism to effectively counter China's BRI and returning to multilateral diplomacy in the IP region, which the Trump administration neglected.

Southeast: Asia: The Test Bed for the Biden

During his transition period, President Biden emphasized a 'secure and prosperous' Indo-Pacific in his calls with leaders of key allies and security cooperation partners. Given this firm commitment of the Biden administration to engage in the IP region and the continued heightened threat perception of China among Australia, Japan, and India, Quad cooperation, the core of the US IP strategy, is likely to proceed robustly at least through 2021. Therefore, Southeast Asia, with its numerous 'swing states' that maintain neutrality between the US and China under the banner of 'ASEAN Centrality,' will become the test bed for the Biden administration's IP strategy in 2021.

Vietnam, the Philippines, Malaysia, Brunei, and Indonesia, which are in potential territorial disputes with China, remember that China occupied Mischief Reef during the Democratic Clinton administration and Scarborough Shoal during the Democratic Obama administration, when the US refused military intervention. Thus, the Biden administration will likely seek to impress upon these nations that the frequency and intensity of 'freedom of navigation' operations, which were significantly strengthened under the Trump administration, will be maintained, and that this Democratic administration will be different from previous Democratic administrations. Simultaneously, it must strategically and delicately adjust the level of military intervention, as countries in territorial disputes with China do not desire a US-China military conflict in the South China Sea that could involve them. In this context, a pressing task for the newly launched Biden administration is to anchor the 'swing states' between the US and China—the Philippines, Indonesia, Vietnam, and Malaysia—within the US-led security network. The Philippines is a US ally, but President Rodrigo Duterte is pursuing a zigzag course between the US and China. Indonesia recently denied refueling for US P-8 reconnaissance aircraft within its territory. While Vietnam is expanding security cooperation with the US, the party-to-party relationship between the Chinese Communist Party and the Communist Party of Vietnam remains strong. Malaysia, along with Indonesia, is a leader of the Non-Aligned Movement.

The Biden administration is expected to utilize the provision of 'Intelligence, Surveillance, and Reconnaissance (ISR)' information and asset sharing for maritime security as a means to anchor 'swing states' within the US-led security network. Various non-traditional security issues such as piracy, illegal fishing, human trafficking, environmental pollution, and major maritime accidents are emerging in Southeast Asian waters. Southeast Asian countries, which are severely lacking in essential ISR equipment for maritime security, welcome contributions from external powers to build their maritime security capabilities. In this context, the US is focusing on enhancing the maritime capabilities of key countries in Southeast Asia. The US has been donating decommissioned warships, aircraft, and surveillance radars, and providing training, recently upgrading the quality of donated items. For instance, the US Department of Defense is operating a program to provide a total of 34 unmanned aerial vehicles through the 'Maritime Security Initiative in the South China Sea,' focusing on strengthening the ISR capabilities of four countries: the Philippines, Vietnam, Malaysia, and Indonesia. Australia, another Quad country, is actively leading the enhancement of maritime capabilities of regional countries in Southeast Asia, drawing on its experience in the South Pacific. Japan, after providing patrol vessels to Southeast Asian countries on a loan basis for some time, has recently revised its domestic laws to allow for grant aid and is proceeding with military equipment donations. In August 2020, Mitsubishi Electric Corp. signed a contract to sell four radar systems to the Philippines. India has been exporting defense equipment and transferring military technology to countries such as Singapore, Vietnam, Myanmar, and the Philippines.

China perceives that the underlying intention behind the Quad countries' contributions to enhancing the maritime capabilities of regional nations, while ostensibly aimed at effectively responding to non-traditional security issues, is to prepare for China's military rise, given the characteristics of the donor and recipient countries. The donors are the US and its allies, and the main recipients are US allies or countries in security competition with China. While China's contributions to building the maritime capabilities of regional countries have so far been limited to low-performance small patrol boats, if it judges that the Quad countries are focusing on enhancing regional maritime capabilities with a view to hedging against China's military rise, China is likely to increase the quantity and quality of its contributions. Therefore, the Biden administration is expected to soon face competition with China in providing ISR information and donating assets to Southeast Asian countries.

Another test for the Biden administration in implementing its IP strategy in Southeast Asia is that the democratic values and respect for human rights, which President Biden has emphasized, do not align with the domestic political situations of most Southeast Asian countries. As the majority of Southeast Asian countries have authoritarian government systems, they are concerned that the Biden administration might try to project values such as good governance, transparency, and democracy onto ASEAN policies. Beyond pro-China countries like Cambodia and Laos, the US could raise issues regarding President Duterte's human rights abuses in the Philippines, a US ally, and the undemocratic legitimacy of the Thai government. Myanmar could also clash with the US over human rights abuses against the Rohingya population.

Meanwhile, President Biden, who emphasizes the restoration of multilateralism, is likely to directly attend the EAS and the ASEAN-US Summit, unlike President Trump. During Biden's term, the ASEAN chair countries will be Brunei in 2021, Cambodia in 2022, Indonesia in 2023, and Laos in 2024. If President Biden, who values human rights and democracy, makes critical remarks about the human rights and democracy situation of the host country, the atmosphere of the EAS and the ASEAN-US Summit could be dampened. Therefore, it remains to be seen whether the Biden administration will mitigate its emphasis on democratic values and human rights principles in Southeast Asia, considering the domestic political situations of Southeast Asian countries, in order to reduce friction.

Another test that the Biden administration may face in Southeast Asia in 2021 is that Southeast Asian countries are looking to both the US and China for assistance in vaccine procurement and post-COVID economic reconstruction. Countries with large populations in Southeast Asia, such as Indonesia and the Philippines, are currently experiencing severe COVID-19 situations, making vaccine procurement their top priority. Philippine President Duterte has stated that if China provides vaccines to the Philippines preferentially, the Philippines might adopt a more lenient stance on territorial disputes in the South China Sea. He has also pressured the US by threatening to abrogate the temporarily suspended 'Visiting Forces Agreement (VFA)' if the US does not supply vaccines, demonstrating the urgency of vaccine acquisition. Which country, the US or China, can provide more assistance in securing vaccines for Southeast Asian countries will be a crucial variable in their future competition in the region.

As pointed out earlier, the US IP strategy lacks a geo-economic mechanism to counter China's BRI. If China, which is recovering from the COVID-19 economic downturn relatively earlier than other countries, exploits the urgent need for post-COVID economic recovery in Southeast Asian countries through large-scale infrastructure projects, the US IP strategy will be undermined. China adopted the 'New Infrastructure Construction (新基建)' policy at the Two Sessions in May 2020 and proposed a 'Digital Silk Road' to ASEAN countries in an address at the opening ceremony of the 17th China-ASEAN Expo on November 27, 2020. Despite international concerns that accepting Chinese capital could lead to a 'debt trap,' it will be difficult for Southeast Asian countries, which urgently need post-COVID economic reconstruction, to resist the allure of massive Chinese capital. Moreover, China is aware of international criticism that the BRI could lead to financial crises in recipient countries, and Chinese leaders consistently emphasize 'high-quality infrastructure construction projects.' It is now difficult to persuade regional countries not to accept China's large-scale infrastructure investments solely based on the argument of rising debt. The US is now facing a test where it must present a large-scale investment program that can provide tangible assistance to Southeast Asian countries for their post-COVID economic recovery.

Our Considerations:: Infrastructure Investment vs. Maritime Capability Building

As part of its New Southern Policy, the South Korean government has been striving to enhance economic cooperation with Southeast Asian countries and India since announcing the 'Korea-ASEAN Future Community Initiative' in November 2017. The policy's direction aims for a People Community, a Community of Mutual Prosperity, and a Peace Community. For the past three years, the focus has been more on the first two 'P's than the third. However, with the launch of New Southern Policy 2.0 from 2021, the proportion of policies in the 'Peace' domain is increasing. This reflects the intention to elevate Korea-ASEAN relations in the areas of peace and diplomacy to the level of relations with the four major surrounding powers, in addition to economic, social, and cultural fields. Furthermore, the emphasis on the 'Peace' domain is not unrelated to South Korea's efforts to expand the common ground between its New Southern Policy and the US Indo-Pacific strategy, amidst US requests for South Korea's participation in its IP strategy. As the US IP strategy expands its scope from security to geo-economics, common interests and benefits have emerged in areas such as economy-centric New Southern Policy and infrastructure investment. Additionally, as the New Southern Policy expands its scope from economy to peace and diplomacy, it is seeking points of convergence with the US IP strategy in areas like maritime security. The 'Joint Statement on Regional Cooperation between the ROK and the US,' announced in November 2019, and the 'Joint Fact Sheet on Cooperation between the US Indo-Pacific Strategy and the ROK New Southern Policy,' announced in November 2020, reflect the efforts of both countries to expand the common ground between the New Southern Policy and the IP strategy.

Regarding infrastructure investment, a common interest between the New Southern Policy and the US IP strategy, as examined earlier, the Quad countries and China are expected to actively engage in infrastructure investment in Southeast Asia during the post-COVID economic recovery phase. As the US, Japan, Australia, and India are coordinating their individual policies by establishing joint development funds, working groups, and forums, South Korea should also consider participating. In particular, since South Korea, Japan, India, the US, and Australia are technologically advanced nations, there is a need to explore ways to jointly bid on or finance infrastructure projects that require advanced technology or involve critical security issues.

If we actively cooperate on infrastructure investment, a geo-economic element of the US IP strategy, it paradoxically creates grounds for conditional participation in China's 'Belt and Road Initiative.' Japan, while actively investing in infrastructure development in regional countries alongside the US, Australia, and India, decided in 2017 to conditionally participate in China's BRI. Japan established the 'Japan-China Third Country Market Cooperation Forum' in 2018 and signed 52 memorandums of understanding for joint investment in third countries. Similar to Japan's approach, if South Korea explicitly declares cooperation with the US, Australia, Japan, and India for infrastructure investment and then participates in China's BRI, it can prevent the US from misinterpreting South Korea's participation in the BRI as leaning towards China. From this perspective, the agreement reached at the 16th ROK-China Economic Ministerial Meeting held virtually on October 19, 2020, to continuously strive for linkage and cooperation between the New Northern/Southern Policies and the BRI initiative is encouraging. At the meeting, both countries agreed on the need to strengthen cooperation channels to vitalize joint ventures of Korean and Chinese companies in third countries and decided to continuously discuss specific measures.

Meanwhile, in the area of maritime security, which is emerging as a new point of convergence between the New Southern Policy and the US IP strategy, South Korea has been increasing its contributions to enhancing maritime capabilities in Southeast Asian countries such as Cambodia, Vietnam, the Philippines, and Indonesia. The purpose of these contributions was to contribute to 'Peace,' one of the directions of the New Southern Policy, and the contributions also yielded economic benefits through defense exports to countries like the Philippines and Indonesia. Given that the Quad countries are expected to be active in enhancing the maritime capabilities of key countries in Southeast Asia in 2021, as examined earlier, while we should continue our individual contributions to Southeast Asian countries, strategic deliberation is needed regarding cooperation and coordination with the Quad countries, unlike in the case of infrastructure investment.

Assuming that we continue to contribute to enhancing the maritime capabilities of Southeast Asian countries to substantially promote security cooperation and generate economic benefits from defense exports, there are three possible scenarios regarding cooperation and coordination with the Quad countries. First, considering China, we could focus solely on our individual contributions without cooperating or coordinating our efforts with the Quad countries. This is because the Quad countries are increasing the quantity and quality of their contributions to maritime capability building and making it an agenda item in every Quad meeting. If we contribute while cooperating and coordinating with the Quad countries, China might perceive that we are participating in the Quad's hedging strategy against China. Second, as the US is strengthening and expanding its self-led security network and demanding a division of labor among its members, we could cooperate and coordinate with the Quad countries within the framework of 'security burden sharing' for the US security network. Third, by cooperating with the US's IP strategy outside the Korean Peninsula, we could 'invest in the alliance' by cooperating and coordinating with the Quad countries to encourage the US to give greater consideration to our interests as an ally in alliance issues where the US and South Korea are in conflict on the Korean Peninsula. The US would likely prefer the second scenario, but we must make our decision in 2021 by comprehensively considering the unfolding of the US IP strategy in Southeast Asia, the extent of the US's demand for South Korea's participation in its IP strategy, and the situation of US-China military confrontation in Southeast Asia. ■

■ Author: Park Jae-jeok_Professor, Graduate School of International and Area Studies, Hankuk University of Foreign Studies. He holds a Ph.D. in International Relations from the Australian National University. He has served as a visiting professor at the Institute of Foreign Affairs and National Security and a research fellow at the Korea Institute for National Unification. His research areas include US-led security networks in the Indo-Pacific region, regional security order, multilateral security cooperation, the US-Australia alliance, and Australian security policy. His recent publications include (2021), (2020), (2020), (2020), and "The Status and Contributions of Quad Countries to Maritime Situational Awareness in the Indo-Pacific Region: Issues and Prospects" (2020).

■ Editor: Seo Jeong-hye EAI Research Fellow

Inquiries: 02-2277-1683 (ext. 207) jhsuh@eai.or.kr

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