By: Cheng-Chwee Kuik

This paper was written in November 2024 prior to the inauguration of President Trump, and as such does not reflect or account for the changes that have occurred in the development space since then due to the second Trump administration's ongoing policies.

Introduction: The Imperative of Balanced Connectivity Building

While infrastructure building is an aspect of each country’s own national developmental effort, it may manifest into interstate cooperation when another country is involved in an infrastructure project’s initiation, financing, construction, and/or operation phases. Interstate infrastructure cooperation is especially common with big-ticket connectivity-building ventures. This essay offers a Southeast Asian perspective on how host countries in the region view foreign-backed infrastructure connectivity building and why some host countries are in a better position than others to pursue balanced connectivity building. It also provides a brief assessment of the roles of China and the United States in Southeast Asia’s quest for balanced connectivity building.

The term “balanced connectivity” was first coined by David Lampton et al. in their book Rivers of Iron: Railroads and Chinese Power in Southeast Asia, when they referred to the regional needs of having multiple major powers as partners in the construction of north-south and east-west connectivity in Southeast Asia.¹ The present essay applies the term at the national level: “balanced connectivity building” is defined here as infrastructure building that involves multiple points of partnerships that are roughly equal, mutually beneficial, and potentially interdependent, rather than a single source of unequal, dominant, and overdependent ventures. The main argument is that if an interstate partnership is imbalanced, chances are it would be unsustainable in sociopolitical, financial, or ecological terms.

These themes are particularly pertinent for Southeast Asian states, a group of small- and medium-sized nations with limited capabilities and resources. Due to their inherent limitations, all ten members of the Association of Southeast Asian Nations (ASEAN) realize that they must enlist external assistance and support (e.g., through multilateral development banks, big powers, regional partners) to pursue connectivity and infrastructure building—a prerequisite for economic growth and modernization. Out of pragmatism, the ASEAN states view asymmetrical power relations—the vast capability gaps between the members and the major powers—as a reality that must be lived with and leveraged upon.²

Hence, virtually all Southeast Asian states have sought to acquire as much capital, technology, and experience sharing from as many powerful and productive partners as possible. This is especially true for those states that are unable to access or gain sufficient funding from the World Bank, the Asian Development Bank (ADB), and other multilateral development banks. While these demands are not new, the intensifying geopolitical rivalries over the past decade have pushed the competing powers to use infrastructure connectivity building as a tool of economic statecraft to win the hearts and minds of regional states, thereby increasing the supply side of infrastructure cooperation.

Examples of this competition abound. The launch of China’s Belt and Road Initiative (BRI) in 2013 prompted Japan to announce the Partnership for Quality Infrastructure (PQI) in 2015. This was followed by a multitude of emerging connectivity cooperation schemes since 2018, including the U.S. BUILD Act (which created the International Development Finance Corporation, IDFC), the QUAD-related Blue Dot Network (BDN), the European Union’s Global Gateway, as well as the G7’s Build Back Better World (B3W) and the Partnership for Global Infrastructure and Investment (PGII). Southeast Asian states have, by and large, greeted these competing and overlapping schemes positively, with an eye to turn those connectivity-building opportunities into modernization gains and developmental dividends.

Legitimizing Elite Authority

Development is not only an economic matter but also a political issue. This is particularly true for Southeast Asian governing elites who rely heavily on economic performance as a pathway to enhance and legitimize their political authority to rule at home. Driven largely by performance legitimization, many countries in Southeast Asia (and elsewhere across the Global South) pragmatically engage China’s BRI and other available developmental partnership opportunities in a selective and prudent manner (some more so than the others), seeking to leverage external asymmetries and turning them into impulses to boost and legitimize the respective elites’ internal authority.³

Developmental performance, however, is not the only basis of elite legitimization. Identity-based and electoral-based legitimization are other pathways. As postcolonial states, Southeast Asian countries are highly sensitive about sovereignty, equality, and policy independence. Any interstate ventures, particularly those involving external powers that are perceived to be unequal or detrimental to national interests or identities risk engendering public resentment and eroding elite legitimacy over time. Examples include several BRI-related projects in Cambodia and Laos, even though some of these ventures do boost governing elites’ performance legitimization in the short term.

In democratic countries with largely free electoral processes and competitive mechanisms, any big-ticket infrastructure deals that are seen as nontransparent or unfavourable for local economies are likely to invite voters’ discontent. An example is the Malaysian general election in 2018, where voters punished the Najib-led coalition over the 1Malaysia Development Berhad (1MDB) scandal, the China-backed East Coast Rail Link (ECRL) deal, and other government policies. Nonetheless, once the new government in Malaysia succeeded in renegotiating the ECRL deal with China with substantial cost reduction and more favorable local contents, the public and elite perceptions of China-related projects gradually turned from negative to broadly positive. This evolving trend has been steadily hastened by the resumption of ECRL construction during and after the COVID-19 pandemic years (scheduled to be completed in 2026), as well as the progress of other completed and up-and-running ventures in Malaysia—such as the CRRC Rolling Stock Center in Perak State and the Kuantan Industrial Park and Kuantan Port expansion in Pahang state—as well as in other parts of Southeast Asia, including the Vientiane-Boten Railway in Laos and the Jakarta-Bandung HSR in Indonesia.⁴

Similar trends can be observed elsewhere in the region, including in Brunei, where, a groundbreaking ceremony was held in August 2024 for the expansion project of Muara Port’s container terminal; in Cambodia, home of the Phnom Penh–Sihanoukville Expressway and Siem Reap International Airport; in Thailand, the ongoing construction of Phase 1 of the Thailand-China High-Speed Rail (HSR) project and the July 2024 announcement of the investment plans for Phase 2 of the project; and in Vietnam, where the government decided in April 2024 to begin construction on two HSR lines in cooperation with China by 2030, one connecting Haiphong with Lao Cai province bordering China’s Yunnan province and another linking Hanoi to Lang Son province, adjacent to China’s Guangxi province.⁵ These are all indicators that despite decreasing attention on the BRI’s projects in mainstream circles, BRI imprints have been quietly gaining ground in Southeast Asia.

All in all, from the viewpoint of Southeast Asian elites’ pursuit of authority enhancement, it is clear that while economically transformative infrastructure building is central to elite legitimation, so too are infrastructure deals that are undertaken in a balanced, transparent, and sustainable manner.⁶

Locating the Host-Country Agency

“Agency” refers to the capacity of a country to act independently and make its own choices. “Host-country agency” refers to the capacity of a sovereign host to make autonomous decisions in infrastructure and connectivity cooperation vis-à-vis its partner(s) based on its own interest, rather than the influence of others. Agency does not guarantee satisfactory outcomes. However, agency does mean that a weaker state, despite its disadvantageous position, is often inclined to actively cultivate options and optimize policy goals as much as circumstances allow.

Host-country agency may manifest in different stages: initiation, negotiation, and implementation. Southeast Asia has numerous examples of host countries taking the initiative to explore infrastructure cooperation with bigger countries. For example, Laos was the one that proposed the construction of the Vientiane-Boten railway to China. In Thailand, then–Thai Prime Minister Abhisit Vejjajiva took the initiative to explore the possibility of partnering with China on building an HSR in the country. Malaysia also invited China to collaborate on several big-ticket infrastructure projects even before the launch of the BRI, such as the Second Penang Bridge in Penang state and the Kuantan Industrial Park in Pahang state. These instances in Southeast Asia illustrate that foreign-backed infrastructure cooperation, such as BRI-related ventures, are often due to smaller-state pull, and not necessarily big-power push.

Host-country agency at the negotiation and implementation stages is more complicated. It depends on several factors, most notably the host government’s bargaining abilities and approaches, inter-elite dynamics, and civil society activism. Once a project is kick-started, a host country may exercise its agency by pushing for its priorities on the one hand and delaying, defying (partially or selectively), or denying (altogether) on the other. These three-D approaches are, in essence, the weapons of the weaker state in foreign-backed infrastructure cooperation. A host country, for instance, may defy by deciding to suspend selective project(s) and request renegotiation. This was evidenced in Myanmar under President Thein Sein and in Malaysia during Prime Minister Mahathir bin Mohamad’s second term, when the respective host government suspended the BRI-related projects on the grounds of public protest or populace resentments. These projects included the Myitsone hydropower dam and the Letpadaung copper mine in Myanmar, as well as the ECRL and two pipeline projects in Malaysia.

Across Southeast Asia, host countries typically also exercise their agency by seeking to diversify their partner countries in infrastructure building. Indonesia, which selected China to build its Jakarta-Bandung HSR, insists on engaging with multiple partners across various infrastructure projects. While also collaborating with China to construct its Bangkok-Nongkhai HSR, Thailand looks to Japan to build the potential Bangkok-Chiang Mai HSR. Vietnam, while eventually agreeing to work with China on the two cross-border HSR lines, prefers to keep Japan, South Korea, and potentially other partners as competitors to China as the developer(s) for its most important HSR line: the planned Hanoi-Ho Chi Minh City HSR project. These are among the examples where the host countries pursue balanced connectivity building: a continuing quest for multiple points of partnerships to ensure roughly equal and mutually beneficial ventures that are sustainable over the long run.

While virtually all host countries are inclined to exert their agency and pursue balanced connectivity building, not all are in the position of translating that desire into actual capacity. Cambodia, Laos, and Myanmar are among those seeking but still struggling to acquire the needed capacity and diversification beyond one single point of infrastructure cooperation.

Based on the above observations and findings of several previous studies, it is contended that the degrees and forms of a host country’s agency to pursue balanced connectivity building depend on multiple factors, two of which are the most important:⁷

• Internal resilience: The ability of a country to develop and mobilize nationwide resources to withstand and respond to certain challenges. Resilience is a function of multiple factors such as political systems, inter-elite dynamics, and bottom-up civil society activism.
• External options: The availability and the range of alternative or additional external partners. These are the key external conditions that a host country could leverage to enhance its bargaining ability and overall capacity to pursue mutually beneficial, productive, and balanced connectivity-building partnerships.

Driven in large part by the logic of and desirability for balanced connectivity building, Southeast Asian states positively view the successive announcements and implementations of Japan’s PQI, the U.S. IDFC, the QUAD’s BDN, the EU’s Global Gateway, as well as the G7’s B3W and PGII. These initiatives are often described by the West as the alternative” schemes to China’s BRI. In the eyes of Southeast Asian states, a credible alternative must be a concrete, accessible, and affordable scheme beyond announcements . Currently, Southeast Asian states tend to view these competing schemes as potential, additional partnership opportunities, rather than either-or alternative arrangements.

Conclusions: Leveraging on Concurrent Power Asymmetries

The United States and China have distinct comparative strengths and contributions to infrastructure and connectivity building in Southeast Asia.

The United States, through the U.S. Agency for International Development (USAID ) and related agencies, has long played a significant role in sustainable infrastructure development in Southeast Asia. In addition to addressing critical issues in energy, water, and sanitation, the U.S. developmental agencies have partnered with Southeast Asian countries on disaster preparedness, transportation networks, urban planning, and public health. Notable examples include the Asia Enhancing Development and Growth through Energy (EDGE) initiative aimed at improving energy access and infrastructure. Both the Philippines’ Energy Efficiency Project and Vietnam’s Clean Energy Program focus on increasing access to clean and renewable energy including solar and wind power and reducing greenhouse gas emissions through approaches such as promoting energy efficiency technologies, providing technical assistance to the public and private sectors, as well as improving regulatory frameworks. Through the Indonesia Urban Water, Sanitation, and Hygiene Project, the United States partners with Indonesia to improve access to clean water and sanitation services in urban areas, especially in underserved communities. The U.S. President’s Malaria Initiative has supported Cambodia’s National Center for Parasitology, Entomology, and Malaria Control objectives since 2013. As a result, Cambodia is on track to eliminate all forms of malaria. USAID has also worked with national authorities and through regional public health networks to train many Southeast Asian health professionals and institutions to tackle the tuberculosis and HIV/AIDS challenges while preventing, detecting, and responding to human and zoonotic disease threats.

Through these and related partnerships, the United States contributes to Southeast Asia’s infrastructure and connectivity building while promoting national resilience, policy transparency, and economic growth across the region. U.S. strengths and contributions concentrate primarily on promoting good practices and good governance, enhancing capacity building for governments at multiple levels, constructing technical facilities, cultivating community engagement for behavior change, fostering a transition to clean water and resources, enhancing sustainable energy security, and improving public health outcomes, thereby supporting the partnering countries’ policy development, broader development goals, and economic growth. While the U.S. government cannot direct private companies to invest in Southeast Asian infrastructure, the USAID encourages public-private partnerships to leverage private sector investment and expertise in innovative solutions to sustainable development.

China, on the other hand, makes important contributions to Southeast Asia’s infrastructure development primarily by providing financing and constructing railways, highways, ports, pipelines, energy plants, industrial parks, and economic corridors. Promoted under the BRI framework and implemented on bilateral grounds, many of these partnerships serve to attract investment and stimulate economic growth while promoting connectivity within and across national boundaries. Better physical infrastructure and digital connectivity, in turn, helps enhance developmental benefits in terms of transportation, trade, tourism, and telecommunications. China’s infrastructure financing is provided primarily through state-owned banks and state-linked enterprises through loans or investments. Some of these loans are offered with fewer conditionalities compared to those of Western counterparts. While these arrangements provide many Southeast Asian states with extra sources of infrastructure funding beyond the ADB and the World Bank, they have also raised concerns about debt sustainability, terms of partnerships, and aspects of implementation. The BRI ventures are typically better known for being successful in engaging powerholders but inadequate in cooperating with stakeholders at the societal and local levels. As BRI enters into its second decade and as China promotes its Global Development Initiative, China’s role in Southeast Asia’s infrastructure building is expected to focus more on smaller, greener, and sustainability-based cooperation in the years ahead.

End Notes

[1] David M. Lampton, Selina Ho, and Cheng-Chwee Kuik (2020), Rivers of Iron: Railroads and Chinese Power in Southeast Asia (Oakland: University of California Press).

[2] Cheng-Chwee Kuik (2024), You Can’t Eat Your Cake and Have It Too: The Impossible Trinity in Middle-State Alignment Choices, Keynote Address at the 2024 China in the World Forum (Australian Centre on China in the World, https://www.youtube.com/watch?v=3iyXavV5i6I.

[3] Cheng-Chwee Kuik (June 15, 2021), “Irresistible Inducement? Assessing China’s Belt and Road Initiative in Southeast Asia,” Council on Foreign Relations, https://www.cfr.org/sites/default/files/pdf/kuik_irresistible-inducemen…; Cheng-Chwee Kuik (2021), “Asymmetry and Authority: Theorizing Southeast Asian Responses to China’s Belt and Road Initiative,” Asian Perspective 45, no. 2, 255–276, https://dx.doi.org/10.1353/apr.2021.0000.

[4] Cheng-Chwee Kuik (2021), “Malaysia’s Fluctuating Engagement with China’s Belt and Road Initiative: Leveraging Asymmetry, Legitimizing Authority,” Asian Perspective 45, no. 2, 421–444, https://dx.doi.org/10.1353/apr.2021.0007; “Social Impact and Community Perception of Belt and Road Initiative Projects in Malaysia,” Merdeka Center for Opinion Research, April 14, 2022, https://asiafoundation.org/wp-content/uploads/2022/04/Social-Impact-and…; Cheng-Chwee Kuik and Zikri Rosli (2023), “Laos-China Infrastructure Cooperation: Legitimation and the Limits of Host-country Agency,” Journal of Contemporary East Asia Studies 12, no. 1, 32–58, doi:10.1080/24761028.2023.2274236.

[5] Cheng-Chwee Kuik (2022), “The Politics of Thailand-China Railway Cooperation: Domestic Determinants of Smaller State BRI Engagement,” in China's Belt and Road Initiative in ASEAN: Growing Presence, Recent Progress and Future Challenges, ed. Suthiphand Chirathivat et al. (Singapore: World Scientific Publishing), 221–248, https://doi.org/10.1142/9789811241314_0009.

[6] Manoj Kewalramani, Oyuna Baldakova, Margaret Myers, Oscar Meywa Otele, and Cheng-Chwee Kuik (May 9, 2024), “The Belt and Road Initiative at 10: Regional Perspectives on China’s Evolving Approach,” Centre for Strategic and International Studies, https://interpret.csis.org/the-belt-and-road-initiative-at-10-regional-….

[7]Cheng-Chwee Kuik (2021), “Elite Legitimation and the Agency of the Host Country: Evidence from Laos, Malaysia, and Thailand’s BRI Engagement,” in Global Perspectives on the Belt and Road Initiative: Asserting Agency through Regional Connectivity, ed. Florian Schneider (Amsterdam University Press, https://doi.org/10.2307/j.ctv1dc9k7j.12; Cheng-Chwee Kuik (2021), “Host-Country Agency and Hedging in Infrastructure Cooperation: Definitions, Drivers, Determinants.” Working paper, Institute of Malaysian and International Studies, National University of Malaysia, Malaysia,.