The following is an op-ed written by Daniel Russel, ASPI's Vice President of International Security and Diplomacy, and Blake Berger, ASPI Consultant. It was originally published in the Straits Times. 

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 U.S. 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 South-east 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 U.S. 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.

U.S. initiatives were valued for their past emphasis on governance, institution-building and longer-term capacity development. But we heard frustration with inconsistent US engagement, the slow pace of project delivery and the political volatility impacting Washington’s development posture.

The recent dismantling of USAID field operations and the erosion of U.S. presence on the ground have fuelled doubts about America’s staying power. Across Southeast Asia, there is deepening scepticism that the United States will continue to contribute to the region’s future.

We heard clearly that what countries in the region seek is not a choice between Washington and Beijing, but durable partnerships that align with their national development strategies, respect their sovereignty and support regional visions like Asean Connectivity and the Asean Digital Economy Framework.

The cost of rivalry between the U.S. and China is evident in development, not only in trade and security. In the Mekong region, for example, multiple overlapping infrastructure and water management projects – often backed by competing donors – have sometimes undermined environmental sustainability goals rather than reinforcing them.

The absence of meaningful coordination has produced duplication of effort and conflicting agendas, particularly in sectors where shared interests ostensibly exist, such as climate resilience, pandemic preparedness and digital infrastructure. Great power competition often drives external priorities that may not reflect national or regional strategies.

This rivalry is not merely inefficient; it is undermining regional autonomy. Countries are being pushed to make binary choices in areas such as infrastructure, energy transition pathways and public health systems. Rather than fostering resilience, this pressure undermines long-term development planning, narrows options and creates systems that are incompatible across borders. For a region that has historically prized its strategic autonomy, the growing cost of US-China rivalry is a serious concern.

The good news is that smarter engagement is possible. Full-scale cooperation between Washington and Beijing may be politically unrealistic, but “structured deconfliction” – practical steps to avoid working at cross-purposes – is both achievable and necessary. Southeast Asian countries often seek hard infrastructure from China and governance support, skills development and sustainable growth models from the U.S. and other partners. When these efforts are structured to be complementary rather than duplicative, they can deliver outcomes that are greater than the sum of their parts.

The U.S. is not going to match China dollar-for-dollar in infrastructure financing, and it doesn’t need to. Its comparative advantage lies in building human capital, strengthening regulatory frameworks, fostering transparency and supporting domestic resource mobilization – critical elements that make infrastructure investments more sustainable and societies more resilient.

Even if the U.S. government is pulling back from traditional foreign assistance, other American actors can step up. The U.S. can turn to its extensive network of universities, private companies and philanthropic organisations to expand capacity-building efforts. Initiatives that offer professional training, digital public goods and technical exchanges in fields like public health, environmental resilience and digital governance can directly strengthen Southeast Asian institutions. These programmes not only meet regional demand but also build enduring partnerships based on skills, standards and opportunity – not dependency.

Public health is one sector where structured deconfliction is especially urgent and actionable. With U.S. support for the World Health Organisation shrinking and global pandemic preparedness under strain, Southeast Asian governments are increasingly aware that they will need to take greater leadership in coordinating health initiatives across the region.

Structured deconfliction could mean aligning external support for sentinel surveillance systems to detect new strains of avian flu, coordinating vaccine cold-chain logistics across borders or ensuring that nutrition initiatives targeting childhood malnutrition – like those emphasised by Indonesia’s Prabowo administration – complement rather than compete. If host governments take a stronger role in steering donor activity, they can maximise public health gains while reducing political friction.

Multilateral institutions and regional organisations such as ASEAN, the Asian Development Bank and Asian Infrastructure Investment Bank offer pathways for smarter engagement. While ASEAN provides an important platform, regional coordination remains imperfect and bilateral efforts and sector-specific initiatives remain crucial.

Southeast Asian governments themselves can also promote transparency in project selection, strengthen regional infrastructure planning and use Asean mechanisms to set clearer standards for external partners. By steering external competition towards complementarity, they can maximise development gains while preserving strategic autonomy.Structured deconfliction is not a concession – it is a strategy for orchestrating competition in ways that minimise damage to the very partners both the US and China seek to assist.

South-east Asian governments are already taking steps to steer external engagement towards their own development priorities. They deserve partners who reinforce that agency – partners who work with their strategies rather than forcing artificial choices or deepening vulnerabilities.

Development strategy is at the heart of this region’s future. Infrastructure, digital platforms, public health systems and education networks are not just economic assets – they are strategic assets. The governments of Southeast Asia clearly want partnerships that respect their sovereignty, deliver sustainable results and support national and regional development objectives.

Washington and Beijing will not be judged by who wins a tariff war—but by who helps Southeast Asia build a future based on opportunity, resilience and lasting prosperity.