Southeast Asia’s Taiwan Scenario Stakes Go Far Beyond US-China Competition

One component of the discourse around U.S.-China competition and Southeast Asia has been the region’s role in a future Taiwan contingency. Much of the focus has centered around how individual states would respond to particular scenarios relative to Beijing or Washington. Though this is a key aspect of potential responses, it also belies the wider stakes for Southeast Asia in a Taiwan contingency and the wider range of actions and responses that the region and other relevant and interested partners would need to consider.

Despite the greater focus on Southeast Asia’s Taiwan stakes amid U.S.-China competition over the past few years, these stakes have been visible for decades. Though Southeast Asian states maintain versions of their own One China policies, there have long been economic links that were subsequently deepened through Taiwan’s Go South policies in the 1990s up to the New Southbound Policy under the tenure of Taiwanese President Tsai Ing-wen from 2016 to 2024

People-to-people ties are also visible across the region. These include tourism, growing student exchanges, and the hundreds of thousands of Southeast Asian migrant workers in Taiwan which by some counts amount to about 3 percent of its population.

Taiwan has also continued to loom large in geopolitical conversations around Southeast Asia by virtue of its geography and strategic significance. Taiwan is central to any effort by China to break out of the first island chain, which is a key variable for all Southeast Asian states that track Beijing’s future trajectory. This is apart from individual links, such as Taiwan’s historically-rooted military exercises with Singapore or its proximity to the Philippines, which President Ferdinand Marcos Jr. himself publicly noted when he observed that the flight time from Taiwan to his home province of Illocos Norte was under an hour.

Southeast Asia’s stakes in a Taiwan scenario would be extensive. Some of this relates directly to U.S.-China competition, such as the extent to which U.S. partners like the Philippines, Singapore, or Thailand would allow use of their facilities in particular contingencies. Yet there are also wider issues that would affect all Southeast Asian states. One is the massive economic fallout, with one estimate forecasting that a war would tank Southeast Asia’s GDP as a region by over 20 percent and cost the globe $10 trillion. Major economic disruptions are still expected in the event of a blockade rather than a major war, particularly for those with greater exposure to trade and links to Taiwan and sectors like electronics, such as Malaysia and Vietnam.

Southeast Asian states and the Association of Southeast Asian Nations (ASEAN) as a bloc would also face intense scrutiny in their race to secure their citizens and even in their diplomatic rhetoric, as we witnessed even in the basic congratulatory messages issued following Taiwan’s January 2024 presidential elections. Geopolitically, a Taiwan scenario could also quickly spread to other theaters and intersect with other flashpoints. There are several uncertainties here, including the role of Russia and North Korea as well as linkages to the South China Sea through touchpoints such as the future of Itu Aba island, the largest disputed feature in the South China Sea, which Taiwan currently possesses.

Recognizing these realities is critical not only to correctly framing the stakes, but also to planning for future contingencies given responses by individual Southeast Asian states, interactions between them as well as actions taken by ASEAN as a grouping. The first aspect of this is the responses by individual Southeast Asian states, and one critical component within that surrounds the securing of Southeast Asia citizens from Taiwan. That significance has only been reinforced by the backlash surrounding what was perceived as an initial veiled public threat from Beijing about the security of some of these Southeast Asian citizens and their linkage to diplomatic positions.

Additionally, recent flashpoints such as the Myanmar civil war and the Israel-Gaza conflict have illustrated the complexities in both accounting for citizens amid growing public pressure as well as the logistics of coordinating evacuation flights, which, given the differential positions and capabilities of each country, may at times require intergovernmental cooperation. Some countries like Indonesia and the Philippines have already disclosed they are thinking through potential evacuation plans. Yet conversations with Southeast Asian policymakers reveal that the level of attention to this is uneven across the region and in some cases does not match the national stakes at play.

Another aspect of the impact of a potential Taiwan contingency on the region is how Southeast Asian states relate to each other. There is a tendency to assume that a Taiwan scenario would automatically result in a descent into a Hobbesian world of conflict and warring interests given the sensitivity of the issue, the differences among Southeast Asian countries as well as the limitations of the Association of Southeast Asian Nations (ASEAN) in addressing some sensitive geopolitical questions such as Myanmar or the South China Sea despite its best efforts. Yet even if one were to concede this point, the actions and responses of individual countries would still impact others. Take for instance the possibility that the United States, either on its own or with select partners, may conduct exercises or other operations as a signaling mechanism during a Taiwan contingency. At a basic level, each Southeast Asian state would need to determine if participation of some sort would be in its own interest. But the extent of coordination would also matter given that the decision of more forward-leaning countries like the Philippines may determine what less active countries are able and willing to do. There is also the potential for this to intersect with unilateral actions. One example is how Indonesia chooses to exercise control of critical sea lanes, particularly given previous sensitivities over and closure of the Sunda and Lombok Straits.

Another component is ASEAN’s regional diplomatic response. ASEAN’s role will be contingent on how Southeast Asian states negotiate the range of views about how to respond diplomatically amid internal tensions and external power pressures. Much of this would depend on specific intraregional dynamics beyond the Taiwan scenario itself, including not just the heft of individual countries but also who holds key roles like ASEAN’s annually rotating chairmanship or the role of dialogue partner coordinator for both China and the United States.

A key consideration in this regard is how ASEAN can urgently and accurately reflect the full stakes and diversity of perspectives at play in parts of its response including statements issued. ASEAN has displayed an ability to employ stopgaps short of more controversial minilateral or “ASEAN Minus-X” suggestions, such as the so-called troika mechanism on the Myanmar issue. Yet the urgency of the Taiwan issue would likely demand more pressing solutions. Beyond this, much like the COVID-19 pandemic, where even former top diplomats publicly noted that the grouping was lacking in some areas, ASEAN’s actions will also be closely scrutinized in a Taiwan scenario. For instance, though ASEAN has a series of processes and mechanisms already in place for areas such as relief efforts, the extent to which these can be utilized if the circumstances fit remains to be seen in scenarios involving evacuation or rescue.

To be sure, a specific Taiwan scenario can be difficult to plan for given that all kinds of permutations can arise out of a combination of variables. Nonetheless, we know enough to understand that given Southeast Asia’s vast stakes in a Taiwan scenario and the multilayered interests at play, there is an urgency for policymakers and other stakeholders to be thinking across countries and sectors about potential contingencies and responses around some of these eventualities. And despite the focus on aggregate choices made by a particular Southeast Asian state relative to the United States or China, practitioners and planners also understand that there will in reality be myriad choices across domains that need to be made quickly under pressure. The more prepared more actors are, the better.