Introduction

The twenty-three chapters in Southeast Asian Affairs 2016 address a vast range of pressures and opportunities for the peoples of the region, from the political impact of spreading social media, to economic and political models showing signs of atrophy, to the large and turbulent regional ripples of economic transformations and policy adjustments around the world. States of Southeast Asia in 2015 faced bottom-up pressures for political and economic change, a tough global economic environment, and more major-power involvement, and even contestation, in the region. Times were very interesting. All of these pressures are likely to persist and potentially intensify in 2016 and beyond. Political and policy changes to address these structural continuities will be paramount.

External Forces

Global and wider regional forces — most, negative — had greater impact in Southeast Asia in 2015. Cassey Lee’s regional economic outlook chapter analyses how the fall in commodity prices, slowing growth in China and tightening U.S. monetary policy affected Southeast Asian economies. None were spared, but the effects were very varied. Brunei was the hardest hit and remained in recession given its undiversified economy heavily dependent on oil export revenue. The most open economies in the region as measured by trade flows — Singapore and Malaysia — also suffered from these external headwinds. The headwinds are expected to continue throughout 2016, suggesting politically difficult reforms will be necessary across the region to maintain growth and development.

Carlyle Thayer’s regional security outlook chapter focuses on challenges to ASEAN’s goals of regional autonomy, centrality and community building. China’s rapid construction of artificial islands on seven disputed land features in the South China Sea stoked the strongest ASEAN language on the disputes and more intense U.S.–China rivalry. Movement on the long-discussed ASEAN–China Code of Conduct in the South China Sea progressed at a much slower pace. In 2015 the threat of regional spillover from the Islamic State’s rise in Syria and Iraq and the growing number of Southeast Asians joining those conflicts and returning home became imminent and then, in January 2016 in Jakarta, realized.

The Major Powers

While the domestic political developments of Southeast Asian countries in 2015 strongly reflected the diversity and fluidity of the region as a whole, the strategic policy settings with relation to Southeast Asia of the four most important extra-regional major powers — the United States, China, Japan and India — had two powerful commonalities. All were established before 2015, with 2015 being a year of continuity and constancy, not change and fluidity. All four major powers saw their economic and strategic interests in Southeast Asia, and consequently their engagement with individual Southeast Asian states and with ASEAN, intensify. For all four, Southeast Asia is a key subregion for their broader strategic interests and concerns. For China, greater focus on “peripheral diplomacy” is part of the Xi administration’s interest in China’s new global major-power status and U.S.–China relations. For the United States, the “rebalance to Asia” is about maintaining the U.S. position as the leading power globally and U.S.–China relations. For Japan, greater economic, diplomatic and security engagement with Southeast Asia is part of Abe’s “proactive contribution to regional security” in the Asia-Pacific and Japan–China relations. Modi’s “Act East” policy is focused on enhancing India’s major-power ambitions in the Asia-Pacific and globally.

As argued by Amitendu Palit, India’s Act East policy under Prime Minister Modi is starting to take a clear shape, with this approach likely to remain for the duration of the Modi administration. Act East has a wider Asia-Pacific focus compared with its more modest Look East predecessor. It is focused on integrating the Indian economy into the Asia-Pacific and East Asian production networks and enhancing India’s security role in the region in line with India’s expanding security interests. The lack of a single coherent expression or master plan for the Act East approach though is undermining its clarity and the ability of states in Southeast Asia to respond to it.

Zhang Zhexin argues that China’s...