In the 1920s, also known as the “Roaring Twenties”, the United States adopted mass production techniques, leading to lower prices for everyday goods and more employment opportunities for its citizens. This, in turn, stimulated greater demand for goods, resulting in a consumer boom that propelled the young but burgeoning nation into the economic superpower we know today.
Fifty years later, on the other side of the world, China implemented numerous economic reforms, focusing on industrial production and manufacturing exports. This strategy, reminiscent of the US’s earlier approach, was bolstered by China’s vast landmass and resource availability, transforming it into a formidable economic force on the global stage.
Today, both countries are engaged in a relentless tug-of-war to claim the title of the world’s leading economic superpower. This rivalry has sparked widespread debate among nations about their preferred ally in this race to the top.
According to a survey by the ASEAN Studies Centre, nearly 2,000 respondents from Southeast Asian countries were asked about their sentiments regarding the United States and China’s geopolitical influence on their respective nations. Despite being geographically closer to China, the responses were surprisingly varied.
Source: https://www.visualcapitalist.com/charted-southeast-asias-worries-american-and-chinese-influence/
How do we really feel?
In the case of our close neighbours in Singapore, it seems that the small island nation has mixed feelings towards the superpowers. While 74% of respondents express anxiety over China’s influence, a notable 63% welcome the United States’ growing influence. This preference is likely influenced by the strong economic ties between Singapore and the US, exemplified by the U.S.-Singapore Free Trade Agreement (USSFTA), which has been in effect since 2004 and has attracted over 5,800 US companies to Singapore.
At home in Malaysia, opinions on China’s rising influence are more divided, with 44% of respondents welcoming its dominance while 56% express concern. However, there is less enthusiasm for the United States, with 68% of Malaysian respondents expressing concern versus 32% who welcome its influence. This sentiment may be partly due to the United States’ open support for Israel in the Gaza conflict, which has led to boycotts of US and Israeli-based companies in Malaysia.
Similarly, respondents from both Brunei and Indonesia share their dissatisfaction with the United States, with 73% of respondents from both countries expressing concerns about its popularity. It is important to note that Malaysia, Brunei, and Indonesia have Muslim-majority populations that are significantly more likely to show solidarity with Palestinians in the conflict, resulting in a negative outlook towards Israel’s biggest ally, the United States.
However, China is not universally favoured either. Citizens of Vietnam and Myanmar are openly antagonistic towards the rising superpower, with 96% and 95% of respondents, respectively, expressing opposition to China. In Vietnam’s case, this animosity likely stems from China’s 1979 invasion during the Sino-Vietnamese War, which left lasting scars. For Myanmar, while China maintains a good relationship with the country’s official government, the citizens’ dissatisfaction with the ruling party has also been directed towards China, similar to the United States’ situation with the Gaza conflict.
When viewed as a whole, it appears that Southeast Asian countries are generally concerned about China’s rising influence (27% in favour and 73% against) while having mixed feelings about the United States (41% in favour and 59% against).
Asia Looking Ahead
What does this mean for investors, especially those in foreign markets? The lack of clear enthusiasm for either side suggests that despite the economic wrestling between China and the United States, the rest of Asia might be keen to forge its own path and emancipate itself from both superpowers’ influence.
A notable example is Thailand, where concerns over both China and the United States are high, with 84% and 80% of citizens, respectively, expressing concerns about both countries. This sentiment indicates a potential shift towards regional independence, reminiscent of the economic trajectories followed by Japan and South Korea in recent years.
As Southeast Asia navigates its geopolitical landscape, investors should remain attentive to the region’s evolving dynamics and be prepared for a future where Asian nations might chart their own course towards economic prominence.
