Southeast Asia Global Relations Outlook 2025

The Southeast Asia Global Relations Outlook provides an overview of the trends that have shaped the region’s relations with global powers, as well as the domestic challenges and shifts that will determine the region’s strategic approach to navigating geopolitical and economic tensions in 2025. The report explores Malaysia’s priorities as ASEAN Chairman this year, as well as the region’s relationships with the United States, China, the European Union, India, Japan, South Korea, the Gulf Nations, and BRICS, including the implications of these partnerships.

While this report is not meant to provide an exhaustive list of Southeast Asia’s global relations and outlooks for this year, is presents some of the most significant developments as we enter a new era of heightened political and economic tensions.

This content was originally published as a series of articles on the Institute’s website at the beginning of 2025.

Executive Summary

ASEAN is facing domestic political and economic challenges while navigating rising geopolitical tensions with impact on bilateral relations and trade. As ASEAN Chair this year, Malaysia is keen to mediate the Myanmar civil conflict and prioritize regional integration. At the same time, tensions around the South China Sea dispute remain and call for a coordinated regional approach.

A major theme for 2025 is turbulence in the global trading system due to the second Trump presidency in the United States and escalating U.S.-China tensions. Many ASEAN economies are particularly vulnerable to Trump’s tariff plans and punitive measures – five of the six largest ASEAN economies have trade surpluses with the U.S. Trump’s plans to place tariffs on Chinese imports can result in many Chinese firms diverting their exports to Southeast Asia instead. This may engender a backlash in many ASEAN economies due to a possible flooding of cheap Chinese imports. However, many ASEAN economies may also benefit from the ongoing reconfiguration of global supply chains away from China as part of the ‘China Plus One’ strategies adopted by multinational firms. ASEAN is expected to remain a diplomatic priority for China in 2025, especially if member states’ relations with the U.S. under the second Trump presidency proceed to deteriorate. BRICS, of which China is a founding member, provides a framework for China’s further collaboration with select ASEAN member states. As BRICS continues to expand and develop, we can expect to see continued collaboration between China and its Southeast Asian partners.

Meanwhile, there are also opportunities in Southeast Asia’s relations with other partners and allies. European expertise in renewable energy and green technologies, for instance, could significantly support ASEAN’s transition to a low-carbon economy, especially in the wake of the US pulling out of global green funding pools under Trump. Furthermore, digital transformation is another avenue for collaboration, with Southeast Asia’s booming digital economy offering substantial prospects for EU technology and innovation-driven enterprises.

About the Southeast Asia Public Policy Institute 

The Southeast Asia Public Policy Institute is a research institute based in Bangkok and Singapore, working across the region. Our mission is to support the development of solutions to the most pressing public policy challenges facing Southeast Asia in the 21st century. The Institute undertakes in-depth research to develop actionable policy solutions on a range of issues across sustainability, technology, public health, trade, and governance. We convene dialogues with stakeholders and decisionmakers to drive discussion on the challenges and opportunities facing markets across the region. The Institute draws on a network of in-market researchers, advisors, and partners to provide insights and recommendations for governments, policymakers, and businesses.