The concern is palpable: as Southeast Asia emerges as the fulcrum of US-China rivalry, how should enterprises calibrate risk in a region where supply chains, maritime routes, and mineral resources hang in the balance? This framing captures the stake yet it risks oversimplifying a landscape defined not just by great-power contestation, but by internal fractures and asymmetric economic pulls that demand nuanced strategic positioning.
Southeast Asia has become a primary battleground for US-China competition in 2026, driven by control over critical maritime chokepoints and resource extraction. The region’s strategic value centers on the South China Sea, the Strait of Malacca, and rare earth mineral deposits resources that directly impact global supply chains and energy security.
Key geopolitical pressures include: China’s prioritization of Southeast Asia to mitigate the Malacca Dilemma through increased investments in Thailand, Vietnam, Cambodia, and Myanmar; US efforts to strengthen military cooperation with Taiwan, Japan, South Korea, and the Philippines to secure the First Island Chain; and intensifying competition over critical minerals, where China leverages geographic proximity while the US pursues diversification strategies.
These external forces collide with structural vulnerabilities that complicate any unified regional response. Triple mainland transitions in Myanmar, Thailand, and Vietnam during Q1 2026 will affect 90% of mainland Southeast Asia’s population. Thailand-Cambodia border tensions threaten regional stability and undermine China’s Maritime Silk Road strategy. Myanmar’s electoral roadmap remains uncertain regarding legitimacy.
The Philippines’ assumption of the ASEAN Chairmanship in 2026 arrives at a critical moment coinciding with the 10th anniversary of the 2016 South China Sea arbitral ruling forcing the bloc to navigate member states’ divergent interests while managing major-power competition.
China’s approach differs fundamentally from US engagement: Beijing offers continuity through formal planning cycles and institutionalized agreements, while US commitments are perceived as contingent on domestic political cycles. This asymmetry creates a trade-off for Southeast Asian governmentsshort-term economic stability alongside rising long-term dependence on China-centric demand cycles and regulatory norms.
Vietnam is positioned as ASEAN’s fastest-growing economy in 2026, followed by the Philippines and Indonesia, but growth remains contingent on external demand and supply-chain restructuring.
For executives and policymakers, the strategic implication is clear: in this contested arena, enterprise risk mitigation hinges on hedging against fragmentation diversifying beyond China dependent nodes while monitoring ASEAN’s chairmanship as a potential pivot point for recalibrated alliances and supply resilience.