This report was published by the Center for Strategic and International Studies on April 12, 2023, and is reprinted with permission from CSIS.

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This report focuses on how Southeast Asian economies can more effectively attract the vast monetary capital circulating in today’s global market by embracing a new political economy that prioritizes financial inclusion, investment attraction, marginal productivity, trade expansion, political stability, and talented leaders able to facilitate the achievement of these goals.

This report contends that for this new political economy to flourish in Southeast Asia, the distribution of power and other essential public goods will not be effective without the meritocratic selection of talent for positions of leadership and governance—a fundamental dimension of robust liberal democracies. More monetary capital through foreign direct investment (FDI), borrowing, and trade will allow Southeast Asian governments to bolster their domestic liberal democratic systems—enhancing their rule of law, transparency, ease of doing business, and political stability.

These factors increase countries’ trustworthiness, which will then enable them to consistently benefit from the tremendous global financial capital that has historically failed to funnel into the region. Despite the fundamental challenge of finding the right balance between talent and power to promote liberal democratic values and institutions in order to attract monetary capital, one can be cautiously optimistic about Southeast Asia’s prospects in the long run.

The Association of Southeast Asian Nations (ASEAN) is stuck at an impasse. The political and economic union of 10 member states in Southeast Asia has faced mounting internal divisions and has struggled to deliver on its mandate of promoting intergovernmental cooperation and facilitating economic, political, security, military, educational, and sociocultural integration between its members and other countries in the Asia-Pacific. As the rise of neighboring China provokes a shift in the global balance of power, many questions arise about how Southeast Asian nations will respond.

On April 6, 2023, APARC’s Southeast Asia Program hosted a group of experts who shared their views on how international relations in the region might unfold over the next decade. The speakers highlighted the prevailing challenges facing the region, including the deteriorating effectiveness of intergovernmental bodies like ASEAN, China’s ascendancy, the resultant shift in the global balance of power, prospects for economic growth, innovation in the digital sphere, and challenges to democracy.

The event was the fourth installment in a special series celebrating APARC’s 40th anniversary. Titled Asia in 2030, APARC@40, the series highlights core areas of the center’s expertise, examines Asia’s transformation over the past four decades, and considers the drivers and shapers of the region’s future.

The event featured Richard Heydarian, a Manila-based scholar and columnist who is currently a Senior Lecturer at the Asia Center of the University of the Philippines Diliman, Quezon City; Elina Noor, a Senior Fellow at the Asia Program of the Carnegie Endowment for International Peace in Washington, DC; and Thitinan Pongsudhirak, a Professor in the Faculty of Political Science and Senior Fellow at the Institute of Security and International Studies at Chulalongkorn University, Bangkok.

ASEAN’s Existential Crisis

Taking a cue from the event title, “Southeast Asia in 2030: The Future of Intermestic Relations,” the speakers first shared their reflections on what the region might look like in 2030. The future of the region is often correlated with ASEAN’s effectiveness. However, according to Thitinan Pongsudhirak, in order to answer this question, one must first disentangle the region and ASEAN, as analysts tend to conflate the two. “Perhaps we should not equate the positive future of Southeast Asia with the success of ASEAN,” he said. 

Pongsudhirak argues that ASEAN has remained in a state of perpetual decline since 2012, “when China began to become belligerent in the South China Sea and a divided ASEAN was not able to come up with a joint statement to address it.” The most salient points of division have also included ASEAN’s response to the humanitarian crisis in Myanmar and the emerging U.S.-China competition. “We are no longer seeing the buzz of ASEAN centrality, it has dissipated, and we now see a prolonged existential crisis of the organization.”

Furthermore, ASEAN has been eclipsed by new intergovernmental partnerships like The Quad and AUKUS. Pongsudhirak predicted that “in 2030, ASEAN will still be around, but in what form? If ASEAN continues in the way it has been working, with its informality and non-interference, it will lose its potency and will be an ineffective organization.” A potential future conflict between the U.S. and China would exacerbate these tensions, and in that case, “ASEAN as we have known it, will be finished,” he said. A possible alternative to this scenario would see “more minilateral partnerships or a restructuring of ASEAN with ‘the original five plus X’ as a better arrangement.”

Mixed Economic Prospects

Shifting away from the political sphere, Elina Noor provided a more optimistic view of ASEAN’s economic future, arguing that “we have to consider, when we look at ASEAN as a grouping, that we are dealing with ten very different nations, and we should come up with different metrics for success.” For Noor, one metric of success is what ASEAN has done for its people. “In this case, in the last 50-60 years of its existence, [ASEAN] has done quite well for its citizens. Proof of ASEAN’s success can be seen in its reducing reliance on the U.S. dollar and increasing use of local currency within the region.”

Noor also indicated that ASEAN has been bullish on everything digital. Malaysia, Indonesia, Singapore, and Thailand have all opened up digital currency systems, to use currency via QR codes. Noor pointed out that “we should view ASEAN as a success economically, not so much politically or in the security dimension.” For Noor, ASEAN’s capacity to facilitate commercial opportunities and enterprise puts the organization on the right track. Whether ASEAN will continue to innovate in the economic and commercial space and act more decisively on geopolitical issues remains to be seen.

Richard Heydarian agreed that, like Noor, he is very optimistic about the region on the economic front. Heydarian predicted that a shifting balance of power might lead to greater economic success for the region by 2030, stating that “we may have a new global GDP leader, China, which will have huge psychological and economic impacts. America’s financial supremacy is a pillar of its primacy [in Southeast Asia].” Heydarian predicted that Vietnam, the Philippines, and Thailand will grow to become trillion-dollar economies and reside more comfortably among the top 20-25 economies, stating that those nations may become part of an expanded G20. Heydarian also predicted movements of major supply chains to Southeast Asia, especially as Apple and other global brands attempt to back out of China. “Some will go to India, but a lot will go to Vietnam…Indonesia and the Philippines are going to be in the mix, so economically, I'm a little bit bullish on this part of the world in terms of aggregate growth.”

Pongsudhirak added a dissenting opinion, indicating that “the narrative of ASEAN’s economic success, with the region being one of the fastest-growing regions, with 700 million people combined with a combined GDP of over 3 trillion dollars, a growth trajectory of about 5.5 percent pre-COVID, a young demographic with a growing middle class and geographical proximity, this narrative now no longer holds.” He identified Thailand as subpar in terms of economic performance and argued that “the era of high growth—more than six to eight percent combined—is finished. In the 1980s and 1990s we saw a lot of that high growth, even in the 2000s, but in 2020, that narrative of regional economic success is now very mixed…Now you have to look at the different economies and economic engagements with the regions ‘à la carte’.”

Escalating Ideological Tensions

Breaking with his economic optimism, Heydarian identified ideological conflict as perhaps the most pressing challenge that the region will face in the coming years, stating that “this is where the ‘New Cold War’ will be entering a different phase. We went from strategic competition five to ten years ago, now we're already in strategic rivalry, but I think in five to ten years from now we may look at strategic enmity between China and the United States.”

In terms of gradations of competition between two superpowers, Heydarian predicts a far more intensified scenario in which a Taiwan contingency might unfold in the next decade. “Things could get very intense in Taiwan, and this is important because this is already putting pressure on countries like the Philippines. My sense is that the Philippines seems to be once again moving away from the pack, we're doing less hedging, and increasingly, there are already discussions of whether the Philippines is going to go for alignment.” For countries like the Philippines, which are close to Taiwan and have robust defense agreements with the United States, Australia, and other partners, “by 2030, some of us would be forced by that time to make a choice.”

Such fragmentation of existing partnerships may, in the view of the panelists, lead to increased minilateralism, the emergence of trans-governmental partnerships, flexible, ad hoc frameworks whose membership varies based on situational interests, shared values, or relevant capabilities. Heydarian indicated that “minilateralism is the de facto alternative to the ASEAN ten-state multilateralism deficit, but minilateralism will also cut across the region… JAPHUS for instance, the Japan-Philippines-U.S. trilateral could be something big in the next five to ten years because not only the U.S. but also Japan are bringing the Philippines into a broader Indo-Pacific strategy.”

Despite the challenges discussed, the stimulating conversation between the panelists served as an opportunity to explore avenues pointing towards a future rich with productive engagement with the region. While “Southeast Asia in 2030” may be unknowable for now, the panelists clarified some of the trends and directions in which the region may be headed, and envisioned some of the possibilities for its complex inter-state affairs.

This interview was first published by The Diplomat magazine.

The growing strategic and economic competition between China and the United States has prompted renewed U.S. attention to the nations of Southeast Asia, a region of 11 nations that sprawls at the center of the Indian and Pacific oceans. Yet, as Ambassador Scot Marciel details at length in his new book, “Imperfect Partners: The United States and Southeast Asia” (Shorenstein APARC & Rowman & Littlefield), Southeast Asia remains poorly understood by many in Washington.

That’s certainly not true of Marciel, a U.S. diplomat who has spent a large part of his 35-year career based in and working on Southeast Asia. After an initial posting to the Philippines that coincided with the 1986 People Power revolt that overthrew President Ferdinand E. Marcos, Marciel would go on to serve as the first U.S. ambassador to the Association of Southeast Asian Nations (ASEAN), and as ambassador to Indonesia (2010-2013) and Myanmar (2016-2020), the latter at a time of great turbulence. These postings were preceded by a period during which he oversaw U.S. relations with Southeast Asia as principal deputy assistant secretary for East Asia and the Pacific at the U.S. State Department.

Marciel, now a member of the Southeast Asia program at the Shorenstein Asia-Pacific Research Center at Stanford University, spoke with The Diplomat’s Sebastian Strangio about the recent trajectory of U.S.-Southeast Asia relations, the “enigma” that is ASEAN, and how Washington should approach a region that desires fruitful relations with the U.S., but is congenitally leery of superpower tensions.

In the introduction to the book, you write, “My friends in the region often talk about how the United States does not truly understand Southeast Asia or how to engage effectively with it. They are not wrong.” This is something that we have seen most recently with the response of some nations in the region, Indonesia chief among them, to the formation of AUKUS, which has been accused of stoking regional tensions. What do you think U.S. policymakers most often get wrong about Southeast Asia?

The AUKUS example highlights the high degree of sensitivity that many in Southeast Asia have toward major powers either raising the geopolitical stakes in the region or establishing mechanisms that might challenge what ASEAN considers its central role in regional diplomacy and security. The advent of the Quad is another example. It’s not that these initiatives were mistakes. Rather, they reflect a tendency that U.S. policymakers sometimes do not fully appreciate just how nervous such developments make Southeast Asian partners. Although I don’t know if this was the case with the AUKUS announcement, U.S. policymakers often assume that Southeast Asian governments will view U.S. foreign policy moves in the region as being as benign or even helpful as the United States sees them. This reflects Washington’s own view of itself as being on the “right side” of most issues, and a failure to recognize that some in Southeast Asia view the United States with some wariness, just as they do China.

The main point I was making in the quote you noted, however, was broader. U.S. policymakers, including me, have struggled for years to figure out how best to work with Southeast Asia as a region. This reflects both the lack of expertise (in academia and government) about the region and the inherent difficulty of dealing with a highly diverse group of countries that has neither a powerful central institution nor a dominant member that can speak on behalf of the members. Attending ASEAN meetings tends to be underwhelming, and visiting multiple Southeast Asian countries regularly is impractical for top officials. That reality, along with the sheer size and importance of some other countries in Asia, means that U.S. policymakers tend to focus on China, Japan, Korea, and India. Absent a major crisis, policy toward Southeast Asia tends to be a corollary of policies toward those major powers, most notably China. This leads to episodic engagement and excessive U.S. emphasis in those limited engagements on broader strategic concerns (i.e., China) rather than on issues of importance to Southeast Asians.

You argue that the U.S. approach toward Southeast Asia “cannot be simply a corollary of its China strategy,” with the implication that U.S. policy toward the region remains to some extent hostage to the increasingly confrontational relationship with Beijing. How can the U.S. convince the region that it is not bolstering its engagement only because of its concerns about China? And how would you assess the Biden administration’s approach on this front over the past two years?

The Biden administration’s approach on this front has been better than that of the Trump administration, which unabashedly made many if not most of its interactions with Southeast Asia about China. Although they probably still talk too much about China when they are in Southeast Asia, senior Biden administration officials and the President himself have made a greater effort to talk about U.S. cooperation with Southeast Asia. This is critical. Southeast Asians are fully aware of the benefits and costs of their relationships with China. They don’t need the United States to “educate” them, and U.S. officials should trust that they have agency in protecting their independence and sovereignty.

Rather than worry excessively about what China is doing in Southeast Asia, Washington should focus on building strong and durable partnerships with the region on its own merits, based on a positive agenda – trade, investment, climate change, health, education and security – and on building confidence in the region that the United States is committed to Southeast Asia long term. That means showing up consistently at all levels, implementing a substantive trade and investment agenda – whether via IPEF or other initiatives – and investing more in key issues that matter to the region. Building that strong partnership, without talking much about China, will ease regional concerns about why Washington is engaging. It also is the best way to bolster the freedom of maneuver of Southeast Asian nations, which should be a U.S. priority.

In the context of the growing strategic competition between China and the United States, the mantra that one often hears from Southeast Asian states is that they don’t want to be forced to choose between the two powers. Do you agree with this framing, and what are the implications for U.S. policy toward the region?

The framing has limited value, in the sense that no one is asking Southeast Asian states to choose between the two powers, and it is not even clear what “choosing” would mean in practical terms. That said, the broader message represented by this mantra is accurate: most if not all of the region wants to enjoy good relations with both China and the United States (as well as with other partners) and resents attempts by either power to pressure them to do otherwise.

The implication for U.S. policy is that the focus should not be on discouraging the countries from having good relations with China but rather on ensuring the United States is a good and reliable partner itself. That means not worrying too much when a Southeast Asian leader visits Beijing and celebrates close ties with China, or when a particular country seems to be leaning more toward China. That is going to happen at times. The United States should focus instead on making sure it is doing all it can to be a good partner with Southeast Asia. I’ll offer a specific example. Indonesia under President Jokowi has moved somewhat closer to China, which causes consternation in some quarters. Washington should not worry unduly about this, as Indonesia is fiercely independent and has moved closer to China in part because the Belt and Road Initiative is funding priority infrastructure projects in the archipelago. Rather, U.S. policymakers should consider what they can do to bolster their own relationship with Jakarta, without making it about China. Among other things, vigorously implementing the recently announced $20 billion Just Energy Transition Partnership would be a great way to do just that.

You served as the first U.S. ambassador to the Association of Southeast Asian Nations (ASEAN), an organization that you describe as an “enigma” and note has often been a subject of disappointment for many in Washington. What do you think U.S. officials fail to understand about ASEAN, and how can the U.S. work more constructively with it?

ASEAN has disappointed many not only in Washington but even in Southeast Asia. It is by design not a powerful, supranational organization, but rather a relatively loose association of countries that see the institution as a useful way to promote cooperation and avoid interstate tensions, amplify their collective voice, and discourage great power meddling. ASEAN’s consensus-based decision-making and its practice of not interfering in member states’ domestic affairs render it largely incapable of bold action, whether on the South China Sea or during Myanmar’s current crisis. What U.S. policymakers sometimes don’t appreciate is that, for Southeast Asian governments, maintaining broad unity and relationships among member states, along with setting the agenda for the region, are essential priorities that make up for these weaknesses.

For the United States, it is important to accept ASEAN for what it is and to recognize that it still offers value. First, I don’t think it’s a coincidence that there have been no inter-state conflicts among ASEAN member states in decades. Second, ASEAN is steadily making progress in reducing trade barriers between member states, making it a more compelling investment destination. Third, its annual meetings provide an excellent opportunity for senior U.S. officials to engage not only with ten Southeast Asian counterparts but also with key leaders from the region and the world. By showing up and engaging consistently at these meetings and supporting ASEAN’s own work, U.S. leaders bolster America’s relations with all ten ASEAN member countries and increase the region’s confidence that the United States is a reliable and good partner.

You write that since the end of the Cold War, the U.S. has “tended to measure countries and adjust the quality of our relationships – including with our treaty allies – based on their progress, or lack thereof, on democratic and human rights grounds.” Given the prickly response that this has garnered from some leaders – Prime Minister Hun Sen of Cambodia is perhaps the most obvious example from your book – do you think it is possible to pursue these moral and strategic goals in tandem? How can the U.S. balance these two imperatives?

Yes, I think it is possible to pursue both goals in tandem. It’s a matter of how we do so. Promoting democracy and human rights is an essential part of American diplomacy, and many in Southeast Asia appreciate our support for these goals. The problem is that some of the tools the United States has come to rely on to advance these goals – critical public statements and even grading of other countries, reducing or eliminating engagement with “offending” governments, and on occasion sanctions – have become both less effective and more obligatory, in the sense of U.S. domestic constituencies demanding their use. These tools might have worked to some extent when the United States was in ascendancy after the Cold War, but countries now have other choices and are increasingly critical of what they see as U.S. double standards.

This does not mean the United States should stop promoting human rights and democracy. Rather, Washington needs to recognize that the world has changed and adjust its tactics accordingly. That means accepting that public criticism isn’t always the best option, that sanctions rarely work, and that promoting democracy and human rights requires more nuance and humility. This will be more controversial, but it also means continuing to talk with the governments in question – while avoiding “business as usual” – in the face of setbacks, except in extreme circumstances such as the appalling junta in Myanmar now. I’m not advocating a 180-degree shift in approach, just some tactical adjustments to make U.S. efforts more effective and more in line with the realities of the world today.

Of the challenges facing Southeast Asia, none carries as much moral and political urgency as the conflict in Myanmar, where you served as ambassador from 2016 to 2020. How would you assess ASEAN’s approach to the crisis, and do you think the U.S. can best help the situation, given the extreme complexity of the conflict and the limitations imposed by China’s proximity?

I give ASEAN credit for trying, via the Five-Point Consensus of April 2021 and its unprecedented decision not to invite junta representatives to key ASEAN meetings. The Five-Point Consensus, however, has failed, both because of the junta’s refusal to compromise and because the consensus itself depended on the flawed assumptions that the generals were reasonable people and that the crisis could be resolved via a dialogue leading to a political compromise. The problem now is that ASEAN is divided and so cannot reach agreement on a different or bolder approach, which is why it continues to tout the Five-Point Consensus. While I hope Indonesia as ASEAN Chair will take more initiative, such as meeting publicly with the National Unity Government (NUG) and key ethnic groups and making clear that it will not accept the junta’s sham elections, I don’t see ASEAN as a whole acting decisively. That is why I have called for Washington to take more of a leadership role in supporting the pro-democracy forces, including through greater assistance and improved coordination with like-minded countries on sanctions.

One potential constraint on U.S. action is that Beijing seems to see U.S. support for the pro-democracy forces as somehow a threat to its interests, so greater U.S. support could result in China doubling down on its backing of the junta. Already, we see China pressing the ethnic resistance organizations in Myanmar’s northeast to strike a deal with the junta, which has a remarkable track record of not honoring such deals. China’s approach is unfortunate, as this is not or should not be a U.S.-China issue. Whatever government emerges out of this crisis is inevitably going to want and need to have reasonably good relations with China. I would assume that the NUG and others within the pro-democracy coalition are making this point regularly to Chinese officials. To the extent that U.S. and Chinese officials are talking about Myanmar, it would be useful for U.S. officials to emphasize that they also would welcome good relations between any future Myanmar government and China. In the end, the United States should step up its support for pro-democracy forces despite China’s concerns because those forces are the only hope for Myanmar to enjoy stability, peace, and prosperity.

This commentary was originally published by The Journal of Indo-Pacific Affairs.

Over the past three decades, the relationship between the United States and Vietnam has undergone a remarkable transformation from foes to friends.¹ Today, Vietnam ranks as the United States’ tenth-­largest trading partner,² and the two countries have established a broad range of bilateral cooperation that spans traditional diplomacy, health and education, and even more sensitive areas such as maritime security. The partnership is characterized by regular and constructive engagement at all levels, demonstrating levels of trust and confidence that were unimaginable not so long ago. Though there is still progress to be made, the US–Vietnam relationship is a testament to the power of reconciliation and the potential for cooperation between former foes.

The development of the relationship was not inevitable. In the aftermath of the Vietnam War, the two nations seemingly shared nothing but mistrust and antipathy toward one another. Initial postwar efforts to normalize relations stalled due to Washington’s belief that Vietnam was not cooperating in accounting for missing Americans from the war and Hanoi’s demand for reconstruction assistance that it claimed Washington had promised. Moreover, Vietnam’s 1978–1979 move into the Soviet bloc, invasion of Cambodia, continued use of reeducation camps, the plight of the “boat people” refugees further deteriorated the relationship and pushed each government to view the other as being on the wrong side of the Cold War.³

Geopolitical Change and Pressing Issues to Address

In the mid-­to-­late 1980s, a shift began to occur as Vietnam initiated economic reforms and sought to reduce its dependence on a faltering Soviet Union. Then–Foreign Minister Nguyễn Cơ Thạch played a key role in this transformation, as Hanoi intensified its efforts to diversify its economic and broaden its diplomatic relationships, demonstrating a greater willingness to cooperate with the United States.

With the easing and ultimate end of the Cold War, the George H.W. Bush administration saw an opportunity to bring about a peace agreement in Cambodia, which would require Hanoi’s support. The prospect of improved Vietnamese cooperation on POW/MIA accounting and the hope to encourage Vietnam to empty its reeducation camps and expedite the movement of refugees to the United States also played a role. These issues provided the two governments with a reason to increase dialogue and begin limited cooperation.

A Confidence-­Building Road Map 

In 1991, after much internal debate, the Bush administration offered Vietnam a “road map” toward normalization. The document proposed that, as Vietnam bolstered POW/MIA cooperation, emptied reeducation camps, allowed refugees to leave for the United States, completed its withdrawal from Cambodia, and helped achieve a Cambodian peace agreement, Washington would respond with increased humanitarian assistance, gradual easing of its economic embargo, and other measures important to Vietnam. Although Vietnam never officially accepted the road map, it largely followed it in practice, leading to a positive cycle of increased cooperation on issues of concern to the United States and concrete steps to toward establishing diplomatic relations.⁴

This process yielded consistent outcomes. In 1991, Vietnam permitted the United States to establish a POW/MIA accounting office in Hanoi and shortly thereafter joined Washington in supporting the long-­sought Cambodian peace agreement. The United States delivered humanitarian assistance to Vietnam, reduced restrictions on Vietnamese diplomats at the United Nations, and loosened constraints on US citizen travel to Vietnam.⁵ As Vietnamese cooperation on POW/MIA accounting grew, the following year, Washington provided additional humanitarian assistance, allowed telecommunications links between the two countries, and permitted US companies to assist in meeting basic human needs in Vietnam.⁶ In 1993, the Clinton administration ended US opposition to multilateral development bank lending to Vietnam and opened the first US Department of State office in Hanoi.⁷

Normalization

With growing trust between the two countries, the pace of progress toward normalized ties depended heavily on improved Vietnamese cooperation on POW/MIA accounting. Although some influential groups in the United States continued to argue that Vietnam was not cooperating sufficiently, a growing number felt otherwise. Essential political cover for movement toward normalization was provided by influential members of Congress, led by former POW Senator John McCain (R–AZ) and Vietnam veteran Senator John Kerry (D–MA).

In early 1994, President Bill Clinton lifted the embargo and announced the opening of liaison offices in each other’s capitals, which was a significant step toward establishing full diplomatic relations. These moves came were made possible by the further expansion of POW/MIA cooperation and continued US humanitarian assistance.

Leading With Commercial Ties/Building Business Constituencies

The establishment was a major milestone, but it was just the beginning of a continuing effort to strengthen the relationship between the United States and Vietnam. Commercial diplomacy was a driving force in this process, marked by the signing of a bilateral trade agreement in 2001 and Vietnam’s subsequent accession to the World Trade Organization in 2007. These steps led to a considerable surge in trade and US investment, creating a strong business constituency that continues to support closer ties between the two countries.

Addressing War Legacies

Addressing issues stemming from the Vietnam War has been another essential ingredient of the improving relationship between Vietnam and the United States. Vietnam’s increased cooperation on accounting for missing Americans was essential to early progress, including President Clinton’s 1995 decision to normalize relations, and remained a critical element in the subsequent strengthening of the relationship. Moreover, regular and close cooperation on the issue proved critical in building personal relationships and trust between the two governments. Remarkably, an issue that had deeply divided the two countries ended up being the catalyst for bringing them together.

Vietnam’s leadership also needed to see that Washington would address legacy issues affecting the Vietnamese people, particularly the continuing impact of unexploded ordnance and the health and environmental effects of the Agent Orange defoliant that US forces widely sprayed during the war. Senator Patrick Leahy (D–VT) played a crucial role in supporting Washington’s provision of assistance, beginning in 1989, to help victims of landmines and unexploded ordnance. While the response was slower on Agent Orange, the United States steadily increased assistance starting in the mid-2000s. The programs initially focused on helping individuals with disabilities and later expanded to include significant assistance to address so-­called chemical “hot spots” in former US military bases.⁸ This was important for the Vietnamese people and demonstrated Washington’s willingness to address issues that were critical to Vietnam’s domestic audience.

Managing the Irritants

The United States has consistently raised concerns, both publicly and privately, about Vietnam’s human rights record and its respect for religious freedom, which has been an ongoing source of tension in the relationship. In turn, Hanoi has expressed concern about US-­based Vietnamese groups that have advocated for regime change, in some cases labeling them “terrorists.”⁹

Importantly, while the two governments have regularly discussed and even clashed over human rights and related issues, they have not let them define the entire relationship. In other words, the governments have not ignored these issues but have not prevented broad progress in the overall relationship. This reflects the view in Washington that changing Vietnam’s communist political system was infeasible and the recognition in Hanoi that the benefits from the relationship far outweighed concerns about US political goals.

China and the Beginnings of a Security Relationship

Although analysts today often consider shared concerns over China a key factor in the US–Vietnam relationship, security cooperation lagged behind the overall relationship for many years due to Vietnamese suspicion of US intentions and Washington’s human rights concerns. It was only when China became increasingly assertive in the South China Sea that the two countries began regular low-­level dialogue on security matters in the early 2000s. Over the next decade, cooperation gradually increased, bolstered by China’s growing aggression and the Obama administration’s decisions to provide security-­related assistance with a focus on the maritime arena.¹⁰

Regular High-Level Engagement/Quality Diplomacy

 A crucial but often overlooked factor in the strengthening of the US–Vietnam relationship has been a combination of regular high-­level meetings and skillful diplomacy. From early on, senior Vietnamese officials have been actively seeking high-­level meetings with US leaders, setting themselves apart from other Southeast Asian diplomats who have taken a more low-­key approach. Even after John McCain lost the 2008 presidential election to Barack Obama, Hanoi wasted no time in reaching out to the new administration and securing a series of high-­level visits that ultimately led to the announcement of a “comprehensive partnership” in 2013.¹¹ When Donald Trump was elected in 2016, Vietnam made a concerted effort to be the first Southeast Asian government to secure a meeting with the new president.¹² These regular top-­level bilateral meetings are crucial in keeping the busy Washington foreign policy community focused on Vietnam.

Another factor contributing to the strengthening of the US-­Vietnam relationship has been Hanoi’s adeptness at working Washington. Vietnamese diplomats have actively engaged key players in the US capital, while top officials in Hanoi have made it a point of welcoming and working productively with US visitors. Vietnam has also cultivated a reputation in the United States for being pragmatic and results-­driven, which is hugely important when dealing with senior US officials or business executives who may be hesitant to invest significant time and effort in engagement unless they are confident it will yield tangible benefits.

The Limits of Partnership

Over the past 30 years, a pragmatic approach, shared interests, and sustained effort have propelled the US–Vietnam relationship forward, resulting in a partnership that benefits both countries. However, the consistently positive trajectory of the relationship has at times led analysts to become overly optimistic about its potential, with some suggesting the United States might gain regular access to the Cam Ranh Bay naval base or establish a significant security partnership with Vietnam.¹³ Vietnam’s reluctance to elevate the relationship to a strategic partnership should serve as a reminder that while bilateral ties have advanced, Hanoi remains concerned about antagonizing China and is wary of how Washington views its one-­party system. Similarly, US concerns about Vietnam’s human rights record continue to limit how far the relationship can progress. While this may disappoint some, the reality remains that the journey from former foes to current friends has been a remarkable achievement and serves as a case study in successful diplomacy.

Conclusion

In conclusion, the journey of the United States and Vietnam from foes to friends has been a remarkable one, marked by significant progress in diplomatic and economic relations. Despite initial mistrust and antipathy after the Vietnam War, the two countries were able to build a constructive partnership through a confidence-­building road map, improve cooperation on issues of concern, and develop a willingness to address war legacy issues. The establishment of normalized ties, commercial diplomacy, and addressing war legacies were all essential ingredients of this process. The ongoing cooperation and growing partnership between the United States and Vietnam highlight the power of diplomacy and the potential for nations to put aside past conflicts and work together toward a shared future. 

Notes

1 This article is derived from Ambassador Marciel’s recently published book, Imperfect Partners: The United States and Southeast Asia (Lanham, MD: Walter H. Shorenstein Asia-­Pacific Research Center, Stanford University and Rowman & Littlefield, 2023).

2 Office of the US Trade Representative, “Vietnam,” 9 March 2023, https://ustr.gov/.

3 Richard C. Holbrooke, “Statement before the Asian-­Pacific Subcommittee of the House Committee on Foreign Affairs,” 13 June 1979, reprinted in Department of State Bulleting 79, no. 239 (October 1979), https://heinonline-­org.stanford.idm.oclc.org/.

4 Marciel, Imperfect Partners, 134–35.

5 Marciel, Imperfect Partners, 135; and Steven Greenhouse, “U.S. Open to Talks on Ties with Vietnam,” New York Times, 23 October 1991.

6 Mark E. Manyin, “The Vietnam-­U.S. Normalization Process,” CRS Issue Brief for Congress (Washington: Congressional Research Service, 17 June 2005), 3, https://fas.org/.

7 Thomas Lippman, “U.S. Drops Opposition to Loans to Vietnam,” Washington Post, 3 July 1993. The author opened the Department of State office in Hanoi in August 1993.

8 Michael F. Martin, U.S. Agent Orange/Dioxin Assistance to Vietnam (Washington:, Congressional Research Service, 21 February 2019), https://crsreports.congress.gov/; and Michael F. Martin, U.S. Agent Orange/Dioxin Assistance to Vietnam (Washington: Congressional Research Service, 15 January 2021, https://fas.org/.

9 “Vietnam Declares California-­based Group Terrorist,” Reuters, 7 October 2016, https://www.reuters.com/.

10 See: Marciel, Imperfect Partners, 161–62.

11 “Joint Statement by President Barack Obama of the United States and President Truong Tan Sang of the Socialist Republic of Vietnam” (press release, The White House, 25 July 2013), https://obamawhitehouse.archives.gov/.

12 Mark Landler, “Trump Hosts Prime Minister Phuc of Vietnam and Announces Trade Deals,” New York Times, 31 May 2017.

13 See, for example, John R. Wilkinson, “U.S.-Vietnamese Security Cooperation for Access to the SCS” (student paper, US Naval War College, 16 June 2015), https://apps.dtic.mil/; and Dov S. Zakheim, “America’s Presence in Cam Ranh Bay Should Be More than Occasional,” The Hill, 29 September 2020, https://thehill.com/.

In February 1986, Scot Marciel was driving home after midnight and went past what he assumed was just another protest near military facilities in downtown Manila. The gathering, less than a year into his first overseas assignment with the Foreign Service, turned out to be the early days of the Philippine People Power revolution, leading to the end of the Ferdinand Marcos regime. This was just one of several times during his 35-year career in the State Department that Marciel would find himself witnessing historic moments in Southeast Asia and in the U.S. relationship with the countries of the region.

That illustrious career includes being the first U.S. diplomat to work in Hanoi since the end of the Vietnam War and serving as the first U.S. ambassador for ASEAN Affairs and as U.S. ambassador to Indonesia and Myanmar.

Marciel, Oksenberg-Rohlen Fellow at FSI and affiliated with APARC, has distilled his experiences and observations into his new book, Imperfect Partners: The United States and Southeast Asia (Shorenstein APARC/ Rowman & Littlefield, 2023). In it, he offers his on-the-ground account of the ups and downs of critical U.S. relationships in the region — focusing on the Philippines, Thailand, Vietnam, Cambodia, and Indonesia — and examines the role of ASEAN and China’s influence in Southeast Asia.

To mark the book’s release, we talked with Marciel about recent events in the region and his views on how the United States should approach Southeast Asian countries in the context of China’s efforts to sow closer ties with them. Watch the conversation:

A Return to the Philippines

The Philippines under President Ferdinand “Bong Bong” Marcos, Jr. is now allowing U.S. forces expanded access to four of its bases. Marciel, who first met Marcos, Jr. as the provincial governor of Ilocos Norte in 1985, expressed some surprise at the Philippine president’s rapid shift to strengthen the country’s alliance with the United States. He noted, however, that even in the last year of the Duterte presidency, which frequently was at odds with the United States, there was some recognition in the Philippines that the relationship with China wasn’t bearing the fruit that had been anticipated. Marciel also pointed out that the deal with the United States does not mean Marcos has abandoned China: he is still working on keeping the relationship with Beijing healthy and visiting Japan, another important partner.

Although there is some Philippine civil opposition to the renewed presence of U.S. forces, Marciel believes that the Enhanced Defense Cooperation Agreement (EDCA) will provide an opportunity for a “more modern and equal partnership,” and hopefully one that can supplant memories of the U.S. colonial history in the Philippines.

Southeast Asian Charm Competition?

As concern continues to rise about a possible invasion of Taiwan by the People’s Republic of China, some have questioned the effectiveness of the U.S. capability to compete with China, particularly in terms of a diplomatic offensive. Marciel responded to a recent New York Times article on U.S. and Chinese efforts to “woo” Indonesia. As China continues to seal trade deals in Southeast Asia, some of which are part of its Belt and Road Initiative, we asked whether the United States can compete with China’s free-flowing cash.

Marciel, taking a step back, cautions that “Indonesia is not a prize to be won,” and that we should not be “scoring diplomatic relations like a sporting event” when we look at improving ties with the countries of Southeast Asia. Indonesia, for example, has a long history with the Non-Aligned Movement, so while it attempts to attract foreign investment, it will resist aligning with any one major power. China tends to offer attractive investment packages with minimal conditions, but “you can’t always count on those investments to happen,” notes Marciel, and even when they do, there can be issues with corruption, as well as social and environmental consequences. The United States tries to put together investments that consider issues like labor and the environment, but Marciel believes that “sometimes we aim a little high” and the conditions make U.S. offerings less attractive.

The Continuing Crisis in Myanmar

We spoke with Marciel just after the second anniversary of the 2021 coup in Myanmar. He began his term as U.S. ambassador to that country in 2016, just before Aung Sang Suu Kyi’s new government was about to take office. As he puts it, it was a time of “euphoria,” not only in Myanmar but also in terms of U.S. hopes for democracy there. It turned out to be a difficult four years for Myanmar and Marciel, as the Rohingya crisis repeatedly erupted and the Myanmar military reacted with violent operations that drove hundreds of thousands of Rohingya out of Myanmar. As Marciel relates in his book, he soon found that even using the word “Rohingya” in U.S. embassy statements could create a diplomatic crisis.

Even with the horrific Rohingya genocide, Marciel cautiously notes that by 2020, when he left the country, most people in Myanmar had more opportunity and freedom under four years of a democratically elected government—the Rohingya themselves being the obvious exception. But in 2021, the “military coup basically eliminated that hope and opportunity.”

Marciel doesn’t hold much hope for an end to the coup anytime soon, but he does see at least one “positive development” over the last two years. During the worst of the Rohingya crisis, many in the majority Bamar community did not believe the reports of massacres, or even worse, did not care. But now, after two years of military rule, “more and more Myanmar people are explicitly recognizing the legitimate grievances and the suffering of many of the ethnic minority populations, including the Rohingya, over the past years, and [there is] some recognition that they were fed a lot of propaganda for a long time about what was really happening.”

Establishing Relations with Vietnam

One of Marciel’s great success stories is the normalization of U.S. ties with Vietnam. It was an improbable success with any number of obstacles likely to prevent it from happening, not the least being the debate about the fate of U.S. prisoners of war and servicemen reported as missing in action. Saigon fell in 1975, and yet in 1995, just 20 years later, diplomatic relations were restored and the U.S. embassy opened in Hanoi.

According to Marciel, it took patience, pragmatism, but also the collapse of the Soviet Union and the end of the Cold War. No longer able to rely on Soviet help for their economy, the Vietnamese became more open to work with the United States, particularly on POW-MIA issues, allowing Vietnamese imprisoned in re-education camps to flee the country, and withdrawing Vietnamese forces from Cambodia.

Marciel sees the U.S.-Vietnam relationship today as a “good-news story” that shows the degree of progress that can be attained when two countries are willing to be rational and work together. The United States still has significant concerns about human rights in Vietnam yet “both sides have agreed to talk about that issue, but not let it define or limit the relationship excessively.”

How the United States Can Improve Relations in Southeast Asia

When pressed for a prescription on what the United States can do to further improve its relationships with the countries in the region, Marciel said, “In brief, show up and engage consistently, with humility, and with a focus on the countries that we’re talking to, not on China, because what they’re looking for, for the most part is, ‘Can we count on the United States being a long-term partner?’”

By ensuring the reliability of the partnership, countries in Southeast Asia have more freedom of maneuver, and they can, if necessary, be more capable to “make decisions China might not like.” The flip side of that—the failure to show up at presidential and high governmental levels, like what happened during the Trump administration—means “you’ve undone all the good that you had done in previous years by investing in those relationships.” The price of isolationism, of neglecting U.S. diplomatic relations in Southeast Asia, is that those countries lose confidence in the United States as a reliable partner. 

Although Japan’s approach to economic diplomacy under the Fukuda Doctrine initially was subject to criticism because of its stance on non-interference in domestic affairs, now some are in retrospect lauding the approach, according to Kiyoteru Tsutsui, deputy director at Shorenstein APARC and director of the Japan Program, and co-editor of the recent book The Courteous Power: Japan and Southeast Asia in the Indo-Pacific Era. This reevaluation comes after consideration of relatively unsuccessful attempts by the United States to “push” democracy onto Southeast Asian countries. 

The better approach is to focus on advancing the rule of law, which the Japanese have done by investing resources in establishing legal infrastructure in the region, Tsutsui tells Shorenstein APARC Visiting Scholar Gita Wirjawan, host of the popular Endgame video podcast. “Liberal democracy in the sense of the rule of law is a good sort of marketing ploy to sell to Southeast Asian countries because that leads to economic benefits, which is critical to making liberal democracy attractive,” he says.

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Tsutsui joined Wirjawan for an Endgame conversation about Japan’s approaches to foreign direct investment (FDI) in Southeast Asia and other topics. One issue that both scholars agreed upon is the difficulty in getting Americans to focus on Southeast Asia, which has been long recognized as a critical region by the Japanese. Part of the problem is proximity, of course, but the region also tends to be overshadowed in American eyes by East Asian countries. 

The conversation also turned to the demographic issue Japan and other Asian countries are facing as populations age and economic growth stagnates. Tsutsui pointed out that, before 1945, the Japanese Empire saw itself as multi-ethnic; it was only after WWII that the nation was perceived as homogenous, a viewpoint bolstered by Japan’s great economic success in the 1960s and 70s. Now, however, Tsutsui says there is no choice: “Japan has to become more heterogenous,” and even conservative voices acknowledge that women need a larger role in the labor force and that immigrant labor will be essential to combat the demographic crisis.

This discussion with Tsutsui is part of an "Endgame" interview series Wirjawan is recording with Stanford experts during his residency at APARC.

This commentary was originally published by Nikkei Asia.

As Myanmar's national uprising against its military's Feb. 1, 2021 takeover enters its third year with no resolution in sight, the international community remains without a viable strategy to help end the crisis.

In April 2021, Association of Southeast Asian Nations leaders sought to lead the international response by proposing a five-point consensus plan to end the violence and start a dialogue to forge a compromise solution.

The consensus, however, was stillborn, both due to the regime's refusal to budge from its hard-line stance and widespread skepticism that any dialogue could lead to a compromise deal in what is fundamentally a zero-sum battle.

This month, ASEAN foreign ministers meeting in Jakarta expressed disappointment at the lack of progress, even as they continued to promote the five-point consensus as the best way forward for Myanmar.

These are smart people. They know the consensus is leading nowhere but they continue to tout it as the path forward because member states are divided and cannot reach consensus on a better approach.

This impasse has left the U.S. in a bind. In the 2000s, ASEAN's engagement with Myanmar's then-military regime while the U.S. pursued a policy of sanctions and isolation was a constant irritant in Washington's relations with the bloc. Each side was disappointed and often frustrated with the other's stance.

In the current crisis, Washington has been more deferential to ASEAN, expressing support for its five-point plan despite the lack of progress.

This approach might have made sense initially, as it reinforced U.S. support for ASEAN centrality and hid the fact that Washington had no better ideas. But ASEAN's failure to move beyond its moribund consensus should be an overdue wake-up call for the administration of U.S. President Joe Biden.

Vows to continue to "stand with the Burmese people" ring increasingly hollow in light of continued U.S. support for ASEAN's failed approach and Washington's insistence on a peaceful resolution to a crisis for which there is no peaceful answer. The longer the U.S. follows this approach, the more its credibility will suffer, as will its ability to influence events in Myanmar.

The cautious U.S. approach to date is likely due to the reluctance of administration officials to take the risk of adopting a bolder policy of fully supporting the resistance. Perhaps they fear that doing so will only lead to more violence, or they question the ability of the disparate elements within the resistance to defeat the military or to hold the country together if they win.

American officials may also be concerned about prompting China to increase its support for the military regime, or may be so preoccupied with Ukraine that they cannot muster the energy to go all in on a strategically less important conflict.

Whatever the reason, Washington's approach has the U.S. notionally on the side of the resistance but without the commitment and resources to help it win.

Policymakers should recognize that the only potentially positive way out of this crisis is for the resistance to successfully oust Myanmar's military regime. As long as the military holds power, there is no hope for the country.

Supporting the resistance more fully carries risks. But staying on the current path all but guarantees years of continued violence, instability and suffering.

What, then, should the U.S. do? First, it should not go back to the previous era of badgering ASEAN to be tougher. That would be counterproductive. It should, however, stop pretending that the five-point consensus offers a path forward, or that there is a peaceful solution to the crisis.

To the extent that Indonesia, ASEAN's chair for 2023, offers a more ambitious approach, Washington should support Jakarta. The U.S. does not need to jettison ASEAN, but it should not tie itself to the bloc's lowest-common denominator.

Absent a viable ASEAN strategy, the Biden administration should assert leadership by offering much more support to the resistance campaign to force the military out of power, or at least to weaken it sufficiently that it looks for a way out.

This should include stepped-up engagement with the parallel National Unity Government and other resistance elements. NUG Foreign Minister Zin Mar Aung's high-level reception in Washington last week marked a positive step and should be followed by more regular meetings, including at the secretary of state level. The State Department should also appoint a career diplomat to serve as special envoy for Myanmar, engaging with the resistance and coordinating sanctions with key partners.

Washington should bite the bullet and provide substantial funding to the NUG and its partners, as envisioned in the recently passed Burma Unified through Rigorous Military Accountability Act.

This aid should not be conditioned on progress toward building a fully united resistance, for the simple reason that this process cannot be artificially forced. To the extent that Washington worries about the resistance's ability to account for the money, U.S. agencies should provide training rather than use the concern as an excuse not to offer aid.

Provision of substantial arms directly to the resistance is both unlikely to happen and would be difficult logistically, but channeling funds would free up resources that the NUG could use to purchase weapons.

The U.S. also should consider providing equipment to help the resistance improve communications and build on nascent efforts to supply internet access to the public. Washington can also gather military experts to consider ways to help the resistance counter the regime's air power, mindful of concerns about supplying sophisticated anti-aircraft systems.

The U.S. has been supporting democracy and civilian rule in Myanmar for decades but has punched far below its weight in the current crisis. It can and should provide much-needed leadership now, while continuing to partner with those elements in ASEAN that recognize that the current trajectory is not a viable option.

The United States can do much more to build closer partnerships with Southeast Asian countries, according to Scot Marciel, the Oksenberg-Rohlen Fellow at APARC, whose previous long career in the U.S. foreign service focused on Southeast Asia and included the roles of U.S. ambassador to Myanmar and Indonesia. He notes, however, that a deeper, more consistent engagement with Southeast Asian nations requires the United States to adopt a more systematic strategic approach to the region, one that draws on a positive agenda that transcends the U.S.-China great power competition.

Marciel recently joined APARC Visiting Scholar Gita Wirjawan, host of the popular Endgame video podcast, to discuss the geopolitical evolution of the Southeast Asian countries and how their relationships with the United States have been unfolding

Marciel is the author of the forthcoming book Imperfect Partners, which provides his on-the-ground witness account of the ups and downs of critical U.S. relationships in Southeast Asia. In his conversation with Wirjawan, he urges U.S. policymakers to design a positive agenda for engaging Southeast Asian countries in areas like health, climate change, and economic development.

The wide-ranging discussion addresses multiple other issues, including the unlucky history of Myanmar and how the international community can help Myanmar’s resistance prevail; the relevance of the Association of Southeast Asian Nations (ASEAN); the dynamics between ASEAN and the Quad, the minilateral grouping comprising Australia, India, Japan, and the United States; and more.

This conversation with Marciel is part of an Endgame interview series Wirjawan is recording with Stanford experts during his residency at APARC.