SOUTHEAST ASIA: Southeast Asia’s economic and strategic significance is rising, prompting stronger collaboration between the United States and Japan. As global powers, both nations are taking proactive steps to foster economic growth, regional stability, and security. According to a discussion hosted by the Hudson Institute, this integrated approach is becoming increasingly crucial as geopolitical tensions persist.
Southeast Asia’s growing economic influence
Southeast Asia is home to nearly 700 million people and is the world’s fifth-largest economy. According to the Lowy Institute, the region has consistently achieved GDP growth rates of 4% to 5%, occasionally surpassing China’s. Rapid economic expansion has made the region a priority for both Washington and Tokyo.
Recognising its potential, the U.S. and Japan have intensified efforts to support the region’s infrastructure development, digital transformation, and supply chain resilience. This is evident in Japan’s Partnership for Quality Infrastructure (PQI) and the U.S. Indo-Pacific Economic Framework (IPEF), which seek to promote sustainable economic partnerships.
Strategic collaboration and security concerns
Beyond economics, security remains a key pillar of U.S.-Japan cooperation in Southeast Asia. According to the Ministry of Foreign Affairs of Japan (MOFA), both countries have ramped up support for ASEAN-led maritime initiatives. Given the strategic importance of the South China Sea, Japan has committed to providing patrol vessels and technical assistance. At the same time, the U.S. has expanded its freedom of navigation operations (FONOPs) in the region.
In April 2024, the U.S., Japan, and the Philippines formalised a trilateral security agreement to strengthen maritime defence capabilities. According to the Hudson Institute, this move highlights their shared goal of countering external coercion and preserving regional stability.
Key areas of cooperation
- Infrastructure and Digital Economy: Japan has invested in smart cities and high-speed rail networks in Vietnam, Indonesia, and Thailand. The U.S. supports digital transformation projects, ensuring cyber resilience across ASEAN nations.
- Maritime and Defence Cooperation: The U.S. and Japan have pledged to enhance ASEAN’s naval capacity through training and modernisation programs. Japan’s coastguard diplomacy continues with expanded patrol vessel donations to Southeast Asian nations.
- Supply Chain Resilience: With lessons from the pandemic, Japan and the U.S. are working to diversify supply chains by reducing over-reliance on any single country.
Challenges to overcome
While cooperation has expanded, challenges remain. MOFA Japan notes that economic disparities among ASEAN nations create hurdles for unified development strategies. Additionally, territorial disputes in the South China Sea continue to pose diplomatic challenges, requiring careful negotiation.
Environmental sustainability is another concern. The Lowy Institute highlights that Southeast Asia’s rapid urbanisation must be balanced with green energy initiatives to ensure long-term economic stability.
The collaboration between the U.S. and Japan reflects a long-term commitment to Southeast Asia’s stability. With continued economic integration, defence, and sustainable development efforts, both nations aim to bolster the region’s growth while maintaining strategic balance. As Southeast Asia’s role on the global stage expands, the combined efforts of Washington and Tokyo will remain instrumental in shaping its future.