Friends to All: Southeast Asia Diversifies, but ASEAN Falters

The outcomes of the 47th Association of Southeast Asian Nations (ASEAN) summit, held during intensifying US-China competition, did not reflect alignment with either superpower but a deeper commitment to avoid having to choose between the two. Leaders of the group’s 11 members—enlarged following Timor Leste’s admission—convened October 26-28 in Kuala Lumpur for the region’s still-central political and economic forum. They openly hedged, accepting US market access and security cooperation while deepening economic entanglement with Beijing. Malaysian Prime Minister Anwar bin Ibrahim embodied the approach in his opening remarks in which he emphasized maintaining autonomy and called for "dialogue over coercion, balance over binaries, cooperation over confrontation".

But the way in which the leaders maintained their balancing act dilutes ASEAN’s strategic autonomy and institutional clout. This is not a new development. The bloc’s consensus-building model has historically constrained its ability to act decisively. Member states have found greater short-term incentives in bilateral deals than in collective bargaining, and great powers have exploited internal divisions. That pattern was evident again recently. Just before the summit, the United States signed trade deals with Malaysia and Cambodia, and framework agreements with Vietnam and Thailand. Several of these pacts include measures that could be seen as targeting China, including unprecedented agreements to cooperate with Washington on third-country issues such as export controls, sanctions regimes, and investment screening. The deals help preserve bilateral relationships and ensure continued access to US markets, but they undercut ASEAN’s institutional leverage and agenda-setting role on the global stage.

At the same time, the bloc upgraded the ASEAN-China Free Trade Area 3.0 on the summit’s last day. That move, which marks a new era of trade between the parties, is designed to cushion against tariff pressure. It reduces trade barriers and increases supply chain connectivity. ASEAN also continues engagement with the EU, the Southeast Asian group’s third-largest trading partner after China and the United States, even as Brussels prioritizes bilateral agreements such as those negotiated with Indonesia, Singapore, and Vietnam. Talks with Malaysia, the Philippines, and Thailand are ongoing.

ASEAN, as a bloc, was similarly sidelined in the process to reach a peace deal between Thailand and Cambodia after border clashes resumed earlier this year. Engagement on the crisis was a chance for ASEAN to develop its capacity to deal with regional conflict, but US President Donald Trump grabbed the opportunity before taking credit for the eventual accord and halt to the fighting.

Southeast Asian states may be hedging out of necessity, but by simultaneously acting outside ASEAN’s orbit they are securing short-term flexibility at the cost of eroding the framework that gives them collective strategic weight. With the Philippines, an ASEAN member that is relatively more willing to challenge Beijing, set to chair the group in 2026, the bloc may have another opportunity to assert itself.