Correcting the course: How the Biden administration should compete for influence in the Indo-Pacific

Executive summary

Key judgements

1. The Biden administration’s approach to the Indo-Pacific has so far lacked focus and urgency. Despite its deep regional expertise and the region’s high expectations, it has failed to articulate a comprehensive regional strategy or treat the Indo-Pacific as its decisive priority.
2. The Biden administration’s focus on bringing normalcy back to US regional policy has restored the status quo, but not advanced its standing in the Indo-Pacific.
3. The Biden administration’s approach to competition with China has focused on the domestic and global arenas, rather than on competing for influence within the Indo-Pacific.
4. The Biden administration’s focus on long-term systems competition with China overlooks the urgency of near-term competition in the Indo-Pacific.
5. The Biden administration has placed strategic competition with China at the top of its foreign and security policy agenda. It has sought to balance US-China rivalry with opportunities for cooperation and efforts to stabilise the regional order.
6. The Biden administration views its Indo-Pacific allies as regional and international “force multipliers.” It has largely trained these alliances on global order issues, with few new initiatives at the regional level and insufficient focus on empowering allies to meet their own security needs.
7. The Biden administration sees the United States as being in a “systems competition” between democracy and autocracy. By making ideological competition with China an organising principle for US foreign policy, Washington risks undermining its attractiveness as a partner for politically diverse Indo-Pacific countries.
8. The Biden administration cannot compete against China effectively in the Indo-Pacific without prioritising engagement with Southeast Asia, particularly Indonesia. It has recognised the need to do more in Southeast Asia, but its success may be limited by its approach to competition with China and lack of an economic strategy.
9. The Biden administration, like its predecessors, lacks an economic strategy for the Indo-Pacific region. This major weakness in regional policy is driven by US protectionist trade preferences at home. Proposed initiatives on digital trade and infrastructure cannot compensate for the absence of a comprehensive trade-based economic approach.
10. The Biden administration views China as a predominantly long-term military challenge. Its efforts to minimise spending on US forward posture in the region suggest it may be less committed to a strategy of deterrence by denial to prevent Chinese aggression.

Recommendations for the Biden administration

To compete for influence in the Indo-Pacific, the Biden administration should:

1. Clearly identify the Indo-Pacific region as its foreign and defence policy priority and marshal resources accordingly.
2. Articulate clear goals for its relationship with China and its strategic position in the Indo-Pacific region.
3. Avoid emphasising ideological competition with China and instead focus on maximising its influence by responding to regional needs.
4. Signal its commitment to a strategy of deterrence by denial to prevent Chinese aggression and bolster its investments in Western Pacific military posture to reinforce its credibility.
5. Empower its allies to assume greater responsibility for their own defence requirements by reducing legislative and political obstacles to allied self-strengthening.
6. Pay special attention to Southeast Asia as a region of strategic importance, given its geography, size and the fluidity of its alignment dynamics.
7. Clearly signal that it is committed to mutually beneficial economic engagement with the Indo-Pacific and adopt trade and investment strategies that reinforce its role as an indispensable resident economic power.

Introduction

In his first major foreign policy speech in February 2021, President Joe Biden vowed “America is back,” setting out a plan to correct the course of its role in the world.¹ But in the Indo-Pacific region — where competition with China is sharpest — the Biden administration has lacked focus and urgency. Despite restoring a sense of normalcy to US regional policy after four years of President Donald Trump, the administration has so far failed to articulate a comprehensive regional strategy or treat the Indo-Pacific as its decisive international priority.

The stakes could not be higher. China’s military power, economic weight and assertive foreign policy agenda are reshaping the Indo-Pacific order — undercutting US pre-eminence and risking a Chinese sphere of influence. Close security partners are openly questioning the United States’ capacity to maintain a favourable regional balance of power and deter Chinese aggression. Many more are questioning the United States’ willingness to resuscitate its role as a leading trade and investment partner in the Indo-Pacific. Coupled with Washington’s patchy diplomacy, especially in Southeast Asia, these uncertainties about US regional strategy are eroding its influence.

Against this backdrop, President Biden’s recommitment to strong Indo-Pacific relationships is welcome, as is his signal that competition with China will be the top priority for US foreign policy. But these words alone will not safeguard the United States’ strategic position. Regional countries are looking to the Biden administration to finally deliver on the Indo-Pacific pivot that Washington has promised for a decade.

Biden’s Indo-Pacific pitfalls to date

No administration could craft a perfect strategy after six months in office. But based on the Biden administration’s approach to the Indo-Pacific so far, there are three reasons to doubt its strategy is heading in the right direction.

1. The Biden administration’s focus on bringing normalcy back to US regional policy has restored the status quo, but not advanced its standing in the region.

By embracing the traditional pillars and processes of US foreign policy, the administration has restored trust and predictability in its regional relationships. Biden’s foreign policy team has reaffirmed the value of US Indo-Pacific allies and partners, engaged with ASEAN and returned the United States to the forefront of the region’s COVID-19 response. The administration has shown diplomatic dexterity by choreographing early meetings with allies to apply pressure on China and moved away from pushing regional countries to choose between Beijing and Washington. With the important exception of its adoption of ideological competition with China — a worrying decision that will complicate US regional strategy — the Biden team’s approach to China marks a return towards balancing rivalry with cooperation and efforts to stabilise the regional order.

While these are positive developments for the Indo-Pacific, none of them break new ground for US regional strategy. On the contrary, most simply restore key features of US policy as it stood before Donald Trump’s presidency. Even the administration’s specific gains — such as restoring the Visiting Forces Agreement (VFA) with the Philippines and concluding new host agreements for US forces in Japan and South Korea — are really a return to the status quo ante. The main exception to this trend is the administration’s elevation of the Quad to a leaders’ level summit which, though impressive, will take time to pay strategic dividends. The Biden administration needs to recognise that this restorationist agenda alone will not improve its regional position.

Secretary of State Antony Blinken meets with CCP Director of the Office of the Central Commission for Foreign Affairs Yang Jiechi and State Councilor Wang YiSource: US Department of State

2. The Biden administration’s approach to competition with China has focused on the domestic and global arenas, rather than on competing for influence within the Indo-Pacific.

The administration has identified competition with China as its top foreign policy priority. But its primary mode for competition has so far been through domestic self-strengthening and global coalition-building, rather than specific regional initiatives. At home, its focus on rebuilding the economic and technological foundations of US power involves major investments in science, innovation, research and 21st-century infrastructure, intended, in part, to out-innovate China and secure the United States’ military-technological edge. Abroad, the administration’s push to globalise strategic competition with China aims to leverage the United States’ major democratic coalitions — NATO, the G7, the European Union and the Quad — to increase pressure on China, promote democratic values and take collective action on issues such as technology standards and multilateral governance reform.

But investment in US competitiveness and global partnerships is not enough. While both efforts will yield some advantages, neither has a direct bearing on the United States’ competition for influence within the Indo-Pacific. Success on the regional front requires Washington to prioritise regional economic engagement, military posture and capacity building, and substantial investments in regional resilience and institutions. But the administration has largely overlooked these priorities: Biden has no trade or investment strategy for the region, he has not prioritised regionally focused defence spending and his team have been slow to engage Southeast Asia on meaningful priorities. These, admittedly, are hard asks. But the fact that the administration has not prioritised them to date suggests a lack of urgency in Washington about regional competition.

3. The administration’s focus on long-term systems competition with China overlooks the urgency of near-term competition in the Indo-Pacific.

Insofar as the Biden administration is preparing for competition in the Indo-Pacific region, it has largely adopted a long-term horizon. On the military front, the administration’s first defence budget request depicted China as a primarily future threat — minimising funding for short-term deterrence priorities in the Western Pacific to pay for long-term military preparations for high-intensity conflict in the 2030s. This has raised concerns among US allies and partners — and US Indo-Pacific Command — that the United States may not be well-postured to deter Chinese aggression in regional flashpoints like Taiwan or the South China Sea this decade.

Above all, this is a question of political will and international priorities — and the extent to which Washington is serious about competing for influence with China in the world’s most dynamic region.

Similarly, in terms of economic strategy, the Biden administration’s signature Build Back Better World infrastructure initiative — a partnership with G7 countries — aims to compete with China’s Belt and Road Initiative around the world. But infrastructure delivery takes years if not decades — a problem, given the United States lacks a trade-based strategy in the meantime. The same is true for Biden’s grander diplomatic aspirations to win the 21st-century competition between democracy and autocracy. Not only is this agenda unlikely to produce a winning coalition in the Indo-Pacific — owing to regional countries’ aversion to values-based strategies — but any genuine progress made on bolstering democratic values would take considerable time. While the administration is right to invest now in aspects of long-term competition, this should not come at the expense of urgent investments in the present.

Correcting the course

The Biden administration still has an opportunity to correct the course of US strategy in the Indo-Pacific region. Above all, this is a question of political will and international priorities — and the extent to which Washington is serious about competing for influence with China in the world’s most dynamic region. Yet, how effectively the Biden team can reorient its approach will be shaped, in part, by its diagnosis of the problem and understanding of regional perspectives.

The following report provides one such perspective. It lays out where the administration has succeeded and failed in the Indo-Pacific during its first six months in office, focusing on six priority issues: competition with China; allies and partners; ideological competition; engagement with Southeast Asia; regional economic strategy; and defence policy. It concludes with a set of high-level recommendations intended as a guide for the Biden administration as it further develops its Indo-Pacific strategy. By far the most important of these from a regional perspective harks back to the original promise of the pivot: the United States should clearly identify the Indo-Pacific region as its foreign and defence policy priority and marshal the necessary resources accordingly.

1. Competing with China

The Biden administration has placed strategic competition with China at the top of its foreign and security policy agenda. Although largely consistent with the Trump administration’s approach, President Biden has departed from his predecessor’s erratic and unilateral tactics. His foreign policy team has indicated it seeks to balance US-China rivalry with opportunities for bilateral cooperation while competing more effectively by leveraging America’s domestic strengths and international partnerships. As Secretary of State Antony Blinken has repeatedly stressed, the administration’s overall aim in both competition and cooperation is “to engage China from a position of strength.”²

A focus on managed and multilateral competition with China is in the interests of the United States’ Indo-Pacific allies and partners. But the Biden administration has prioritised domestic self-strengthening and global coalition-building ahead of initiatives to compete in the Indo-Pacific region — a far more immediate priority. This imbalance in Washington’s China policy must be redressed if it is to succeed in establishing the regional conditions necessary to collectively constrain Chinese influence. This requires the administration to articulate clear aims for its China policy — rather than treating competition as an end in itself — and integrate these into a comprehensive Indo-Pacific strategy.

Power vs ideological competition

President Biden revealed his competitive approach to China early and with surprising intensity. Less than a month after taking office, Biden foreshadowed “extreme competition” with Beijing, vowing to address the “China challenge” through “whole of government effort, bipartisan cooperation in Congress, and strong alliances and partnerships.”³ His Interim National Security Strategic Guidance, like the Trump administration’s strategy documents, justified this approach in balance-of-power terms, warning: “[China] is the only competitor potentially capable of combining its economic, diplomatic, military, and technological power to mount a sustained challenge to a stable and open international system.”⁴ The Biden administration has also advanced the case for strategic competition in starkly ideological terms. In speeches and policy documents reminiscent of the Cold War, Biden has claimed the world is “at an inflection point” in the struggle between autocracy and democracy that puts “[America] in competition with China…to win the 21st Century.”⁵

By contrast, Biden’s elevation of ideological considerations to the forefront of US-China competition is a divisive move that chafes with the Indo-Pacific’s political diversity and preference for peaceful coexistence with China

The combination of a balance-of-power and values-based approach to competition has distinct pros and cons for the Indo-Pacific. For US allies and partners that harboured concerns Biden might return to excessively lenient Obama-era policies on China, the administration’s commitment to geostrategic competition is a reassuring signal. Coupled with its positive emphasis on defending international rules and norms — such as sovereignty, maritime rights and peaceful dispute resolution — and its commitment to working collaboratively with allies and partners, the Biden administration can strike the right rhetorical balance between competing with China and strengthening the regional order.⁶

By contrast, Biden’s elevation of ideological considerations to the forefront of US-China competition is a divisive move that chafes with the Indo-Pacific’s political diversity and preference for peaceful coexistence with China. Taken to its logical conclusion, the democracy vs autocracy framework implies an existential confrontation that goes far beyond what most regional countries are willing and able to support. Whether this is the administration’s intent remains uncertain — reinforcing the need for a clearly articulated China policy and a statement of the United States’ vision for the end-state of strategic competition.

Domestic rebuilding and global coalitions

The administration has largely pursued strategic competition with China on two fronts — neither of which is directly focused on the Indo-Pacific region. First, it has invested heavily in Biden’s signature push to revitalise the economic and technological foundations of American power — a domestic agenda that forms part of the administration’s commitment to rebuilding American jobs and delivering a “foreign policy for the middle class.”⁷ In contrast to Trump’s approach — which focused on mitigating the risks posed by China’s technological rise — Biden has laid out a more positive agenda to “develop and dominate the technologies of the future” in an effort to out-innovate China and secure America’s competitive edge.⁸ This has prompted major investments in science, technology, research and development and manufacturing.⁹ In response to the 100-day Supply Chain Review, for instance, the administration took measures to strengthen battery, critical mineral and semiconductor supply chains, while maintaining Trump-era restrictions on China through tariffs, entity listings and enhanced foreign investment screening.¹⁰ Crucially, the Innovation and Competition Act — a US$250 billion legislative package making its way through Congress — appears set to deliver substantial funding for 5G, artificial intelligence, semiconductors, quantum computing and other critical technologies;¹¹ and the Biden-backed US$1.2 trillion bipartisan infrastructure package will, if passed, provide for major upgrades to renewable energy, port facilities, broadband, roads and bridges, and other critical infrastructure.¹²

Chinese Vice Foreign Minister Xie Feng holds talks with US Deputy Secretary of State Wendy Sherman in Tianjin, China, 26 July 2021Source: Getty

Second, the administration has spent significant diplomatic capital on globalising strategic competition with China — an agenda that is closely related to its prioritisation of ideological considerations. Speaking at the Munich Security Conference in February, Biden appealed to European partners “to prepare together for a long-term strategic competition with China,” contending: “How the United States, Europe, and Asia work together to secure the peace and defend our shared values and advance our prosperity across the Pacific will be among the most consequential efforts we undertake.”¹³ To date, the administration has brought multilateral pressure to bear on Beijing across a range of issues — including China’s human rights abuses in Xinjiang, cyber espionage and non-market economic activities — and sought to elevate China as a trans-Atlantic priority within NATO, the G7 and the European Union (EU).¹⁴ Even regional security partnerships, such as the Quad, have become more focused on the global aspects of competition since Biden assumed office, working towards common positions on issues such as critical technologies, setting emerging technology standards and multilateral governance reform.¹⁵

Insufficient focus on the region

The administration’s focus on the domestic and global aspects of competition will yield some strategic payoffs. Rebuilding the United States’ economic, technological and industrial base is critical to the long-term trajectory of its power vis-à-vis China — making this a necessary, if insufficient, pillar of strategic competition.¹⁶ Multilateral action on some global challenges, such as technology competition and standards, is a useful way to shape Chinese actions where a consensus can be forged.¹⁷ However, the globalisation of competition with China is not certain to deliver results — owing to the fact that European partners are not all willing to endorse Washington’s approach to intense competition with China, or devote substantial resources to the Indo-Pacific.

But for Indo-Pacific countries worried about China’s expanding influence and coercive statecraft, investment in the United States’ long-term competitiveness and global partnerships is not enough. Competing with China from an Indo-Pacific perspective requires Washington to prioritise regional economic engagement, military deterrence and capacity building and substantial investment in regional resilience and institutions. On this front, the Biden team has lacked focus. Although the administration has delivered on aspects of this agenda — delivering 40 million COVID-19 vaccines to the region, providing US$4 billion to the global COVAX initiative and clearly reiterating its support for Indo-Pacific allies and partners — these efforts have not been enough to meet regional needs or expectations.¹⁸ A more active, present and ambitious US strategy would reassure Indo-Pacific countries that Washington is committed to investing in the region, incentivising more effective regional push back and collective action on China.

The United States’ Indo-Pacific allies and partners are also looking for reassurance that competition with China will not escalate to conflict. Although the Biden team shares the region’s preference for enhanced strategic stability, US-China rivalry has made progress difficult. Efforts by Secretary of Defense Lloyd Austin to reinstate high-level military dialogues and crisis management mechanisms have been rebuffed by Chinese officials.¹⁹ Moreover, while the administration has returned to a policy of “strategic ambiguity” in its relationship with Taiwan — which is viewed as a stabilising measure — the cycle of escalating Chinese coercion and growing US and allied support for Taiwan could jeopardise the relative stability this brings. Clarifying the United States’ objectives for strategic competition with China may be the best way to defuse these tensions in the short term.

2. Revitalising alliances and partnerships

As part of its global agenda to strengthen the United States’ network of allies and partners, the Biden administration is reinvigorating its key democratic alliances and partnerships in the Indo-Pacific.²⁰ Following four years of turbulent ties under Trump, Biden’s foreign policy team has performed exceptionally to deliver timely and effective relationship repair, with the elevation of the Quad to a leaders’ level summit as its signature achievement.

The Biden administration regards allies and partners as indispensable “force multipliers” for strengthening the liberal international order and addressing a long list of global concerns, ranging from competition with China to climate change and the COVID-19 recovery.²¹ Yet these global priorities are not directly relevant to competing for influence within the Indo-Pacific, and the hard work of transforming alliances to address regional security challenges remains ahead.

Efforts to modernise and network alliances and partnerships are not new. The Obama administration sought to refashion the United States’ Indo-Pacific partnerships into “global order enhancers” with a focus on issues such as international security, climate policy, global governance, human rights and more.²² While the Trump administration narrowed the focus of key alliances and partnerships to place greater emphasis on security, it nonetheless aimed to encourage a networked strategic policy agenda in the Indo-Pacific region.²³ Biden has picked up these efforts and is working to widen the international policy aperture of these relationships once more. But sharper focus on strengthening their regional order-defending agendas and on empowering allies and partners is needed.

Going global, not regional

President Biden has elevated the Quad arrangement between Australia, India, Japan and the United States into the centrepiece of an Indo-Pacific strategy.²⁴ The inaugural Quad leaders’ meeting in March 2021 marked a welcome consolidation of years of diplomatic effort and converging strategic interests on the part of all four members. That it was convened so early in Biden’s tenure points to the skilful diplomacy of his foreign policy team and the importance they accord the Quad as a driver of collective strategic objectives.

Several ambitious commitments arose from the summit. Decisions to deepen cooperation on health security and infrastructure development, and to set up working groups on climate change and critical technologies signalled a willingness by all four participants to step up collective efforts to provide regional and global public goods beyond the maritime security realm.²⁵ The announcement of a Quad Vaccine Partnership to “strengthen and assist” Indo-Pacific countries in meeting their health security requirements was an early demonstration of the regional dimension of this agenda.²⁶ In addition to driving a major health initiative, it also provided a way to compete with China — and counteract Beijing’s “vaccine diplomacy” — by demonstrating the Quad can deliver tangible regional goods and leverage its members’ unique strengths.²⁷

The inaugural Quad leaders’ meeting in March 2021 marked a welcome consolidation of years of diplomatic effort and converging strategic interests on the part of all four members.

In parallel to working with the Quad, the Biden administration has sought to refocus key Indo-Pacific alliances and partnerships on global challenges. Washington used early engagements with Seoul and Tokyo to reaffirm its treaty commitments, reiterate ongoing defence cooperation priorities and explore new opportunities for cooperation on clean energy, supply chains and critical technologies.²⁸ The joint statements emerging from the US-Japan and US-Korea leaders’ summits elevated the global scope of these alliances, resolving in both cases to establish new bilateral mechanisms on climate change, health security and technology challenges.²⁹

The Biden administration has sought to bolster the global focus of the US-India partnership, emphasising cooperation on climate change, health, supply chain security and technology issues; and flagging expanded policy coordination in the Indo-Pacific, Africa and the Middle East.³⁰ While there have been few high-level interactions between the United States and Australia to date, the Biden team has highlighted existing regional and global priorities for the alliance³¹ and sought Canberra’s cooperation on health security initiatives and the promotion of democratic values through multilateral groupings like the G7+ and Five Eyes arrangement.³² The United States’ Indo-Pacific allies have also been enlisted to support major multilateral initiatives proposed by the Biden administration, such as the Leaders’ Summit on Climate as well as the Build Back Better World partnership — a G7 initiative to compete with China by mobilising private sector capital for infrastructure projects in low- and middle-income countries.

Looking for the regional payoff

But there has been comparatively little progress on new regional initiatives from the Biden administration engagement with major Indo-Pacific alliances and partnerships. With the exception of the Quad Vaccine Partnership, new projects designed to have a positive impact in the region — such as the US-Korea Global Vaccine Partnership and US-Japan Competitiveness and Resilience Partnership — have been slow-moving, a missed opportunity for the administration’s alliance revitalisation agenda.³³

Moreover, the effort that Biden’s team has invested in marshalling European support for competition with China is only likely to have a marginal impact on the Indo-Pacific strategic environment.³⁴ Although some EU members have joined Washington in criticising Beijing’s human rights abuses and cyber malpractices³⁵ or deployed naval forces to show the flag in regional flashpoints,³⁶ such actions are largely symbolic to date. From the perspective of economic and security interests, there is little overlap between the global concerns of extra-regional partners and the acute geopolitical challenges facing Indo-Pacific countries.³⁷ While it may be relatively easy for the Biden administration, with its very close ties in Europe, to incentivise trans-Atlantic participation in a global order agenda, Washington’s attention would be better spent on working with allies and partners on more concrete Indo-Pacific priorities.

Empowering allies and partners

Unlike their North Atlantic equivalents, US alliances in the Indo-Pacific have not been equipped to deliver on the kind of industrial and technological integration now being envisioned by the Biden administration.³⁸ Protectionist instincts on both sides of US politics make this unlikely to quickly change. For instance, efforts to improve US-Australia defence industry integration by incorporating Australia into the US National Technology and Industrial Base (NTIB) continue to encounter legislative and political roadblocks despite their sound strategic logic.³⁹ Of greater concern is that the Biden administration is tightening the Trump administration’s “Buy American” regulations in ways that could further complicate industrial cooperation with close security partners.⁴⁰ These and other impediments to integration must be removed if Biden is to successfully modernise US alliances in the Indo-Pacific.

The United States, Japan, India and Australia participate in the virtual Quad Summit, 12 March 2021Source: The White House

The Biden administration must also do more to empower Indo-Pacific allies and partners to strengthen their own defence capabilities. This means overcoming Washington’s preference for tightly controlling the flow of defence technology and technical know-how to close allies and partners.⁴¹ On this score, the Biden administration’s record is mixed. Its landmark decision to scrap the US-Korea Missile Guidelines in May removed decades-old restrictions on Seoul’s ballistic missile capabilities, enabling South Korea to produce and field longer-range systems that provide it operational advantages vis-à-vis China and North Korea.⁴²

By contrast, the administration is still refusing to endorse India’s decision to purchase S-400 air defence systems from Russia on the grounds it could jeopardise future arms sales, interoperability and technology cooperation.⁴³ It is also moving slowly on Canberra’s interest in acquiring US technical information to facilitate the establishment of a sovereign guided weapons capability on Australian soil that could see it manufacture long-range missiles for allied use.⁴⁴ By increasing the ability of US allies and partners to defend themselves and contribute to collective defence efforts, such initiatives offer mutual strategic advantages. These self-strengthening efforts should be embraced by the administration as part of its alliance modernisation agenda.

3. The democracy agenda

President Biden’s ambition to rally a global alliance of democracies to counter Russian and Chinese autocracies has re-emerged as a key organising principle in US foreign policy. In a major speech at the Munich Security Conference in February, Biden laid out this vision in Manichean terms, describing the world as being at an “inflection point” between those who viewed autocracy as the best way forward and those who understood that democracy was essential.⁴⁵

Rather than being purely rhetorical, Biden’s values-based foreign policy risks having a direct bearing on the United States’ Indo-Pacific strategy. While the administration has shown it will deploy a different narrative in Southeast Asia, a confrontational and ideological approach to strategic competition with China may yet prove an obstacle to deepening ties with a broader range of smaller countries who will be concerned by the potential for this approach to contribute to regional tensions and divisions.

Ideology as a driving force

In Biden’s worldview, the United States is engaged in a systems competition with China that will determine whether democracy or autocracy triumphs in a 21st-century struggle for global order.”⁴⁶ His belief that democracy is the United States’ most important strategic asset and the “wellspring” of its power has made democratic strengthening a domestic and foreign policy imperative.⁴⁷ The administration’s Interim National Security Strategic Guidance articulates democracy revitalisation at home and abroad as an organising principle for US foreign policy and part of an ideological agenda that will allow it to prevail in strategic competition with China.⁴⁸ The interim guidance defines Biden’s democracy renewal agenda as encompassing many contemporary priorities, including combating cross-border aggression, cyberattacks, disinformation and digital authoritarianism, infrastructure and energy coercion, and taking aim at corruption.⁴⁹

NATO leaders pose for a group photo in Brussels, 14 June 2021Source: The White House

An emphasis on democratic values is not new in US foreign policy. Yet, Biden’s worldview is distinct for its focus on democratic renewal at home and abroad, an approach that fuses foreign and domestic policymaking to an unusual degree. By emphasising democratic renewal, Biden is signalling a sharp departure from his predecessor who encouraged authoritarian leaders abroad and undermined democratic norms at home, including by refusing to acknowledge defeat in the 2020 election and fuelling the 6 January Capitol riot.⁵⁰ In contrast to the neo-conservative approach to democracy promotion in the early 2000s⁵¹ — which stressed “America’s exceptional role as a promoter of the principles of liberty and democracy”⁵² — the Biden administration and Democratic Party regard US democracy itself as being under threat from “without as well as within.”⁵³

Managing rhetoric and reality

Although the administration has prominently broadcast its democracy agenda in domestic and global forums, it has tried to use a softer narrative in the Indo-Pacific. Speaking at the IISS Fullerton Forum in Singapore in July, Secretary of Defense Lloyd Austin did not resile from the United States’ democratic values, but acknowledged its recent “painful lapses,” confessing “When a democracy stumbles, everyone can see and hear it.”⁵⁴ This humble tone resonated with Southeast Asian audiences and complemented a less confrontational approach towards China in his address. The Biden team has also tried to defuse concerns its values-based foreign policy will undermine strategic ties with non-democracies. It has signalled it will remain willing to engage diplomatically and even improve ties with countries that have poor human rights records, such as Vietnam.

Nonetheless, given the centrality of democratic values to Biden’s domestic and foreign policy agenda, they will likely play a substantive — and not merely rhetorical — role in US foreign policy. Demonstrating the ability of democracies to meet global challenges and deter autocratic threats was the central theme of Biden’s engagement with European partners at NATO, the G7 and the EU this year.⁵⁵ For instance, Biden’s unveiling of the Build Back Better World Partnership at the G7 summit in Cornwall defined this signature infrastructure initiative as one to be delivered by “major democracies” as part of their competition with China.⁵⁶ More is likely to be revealed about Biden’s agenda when he hosts a virtual Leaders’ Summit for Democracy in December 2021, delivering a pre-election commitment to “renew the spirit and shared purpose of the nations of the free world.”⁵⁷

The pitfalls of a values-based strategy

The Biden administration’s ideological foreign policy risks limiting its ability to compete effectively with China in the Indo-Pacific for at least four reasons. First, it misdiagnoses the nature of US-China competition. As Chinese foreign policy experts have argued, the “true sources of China’s foreign policy influence are transactional and coercive, not ideological.”⁵⁸ China’s influence building in the Indo-Pacific, for example, relies more on its ability to benefit local elites and meet development needs than on the attractiveness of its political system.⁵⁹ Beijing seeks a regional order in which countries defer to its interests, but it has proven equally adept at cultivating deference in flawed democracies such as Malaysia and the Philippines as in non-democracies such as Thailand.⁶⁰ If the United States and its allies fail to appreciate that China builds influence by extending significant material benefits, especially to elites, they will continue to fail in delivering a competitive strategy for the region.

Second, despite the intuitive appeal in the West of rallying the world’s democracies to check China’s power, this agenda can only unite a narrow coalition in the region. Unlike Western Europe in the 1950s, Indo-Pacific political regimes are highly diverse with few liberal democracies in the mix.⁶¹ Indeed, many of the United States’ most important regional partners when it comes to competition with China — such as the Philippines, Singapore, Vietnam and, increasingly, India — fall outside the liberal democracy club, even as they share deep concerns about the nature and purpose of Chinese power.⁶² As such, explicitly defining strategic competition in ideological terms is likely to create distance between the world’s democracies and the regional countries Washington wants to assist.

Despite the intuitive appeal in the West of rallying the world’s democracies to check China’s power, this agenda can only unite a narrow coalition in the region.

Third, Biden’s prioritisation of global cooperation with leading democracies could lead the administration to emphasise European allies over emerging partners in the Indo-Pacific, which are less likely to share US political values.⁶³ This may already be happening. Biden’s high-profile attendance at G7, NATO and EU summits were important opportunities to show democracies can work together on global priorities.⁶⁴ But similar forums of like-minded nations do not exist in the Indo-Pacific. The Biden team must move beyond its democracy renewal agenda when engaging in regional architecture and should spend equal time and attention on its summits with Asian partners, such as APEC and the East Asia Summit, and with the G20’s broader membership of Indo-Pacific countries.

Finally, the administration’s ideological approach to competition with China may prove counterproductive for Washington’s standing in the Indo-Pacific. Even regional countries that share US democratic values will be unsettled by a perception that US-China competition is developing along primarily ideological lines. As Singaporean Prime Minister Lee Hsien Loong said in June, working with China is a fact of life for regional countries, adding that “you don’t have to become like them, neither can you hope to make them become like you.”⁶⁵ This pragmatic attitude is characteristic of a region in which China is the economic heavyweight.⁶⁶ Framing regional strategy in terms of a struggle between democracy and autocracy — or “freedom and tyranny” as former Secretary of State Mike Pompeo put it⁶⁷ — suggests deeper and more permanent divisions between opposing blocs. This makes Indo-Pacific countries worried they will lose their strategic autonomy and room for manoeuvre, reducing the likelihood that they will support US policy objectives.

4. Slow moving in Southeast Asia

Owing to its size, strategic geography and the fluidity of countries’ alignment decisions, Southeast Asia is an important nexus of strategic competition in the Indo-Pacific.⁶⁸ It is also where China’s expanding strategic influence is having the most immediate impact on the regional order, both on land and at sea. Viewed from the region, the United States cannot achieve its Indo-Pacific goal of maintaining a favourable regional balance of power without competing effectively in Southeast Asia.

Yet the Biden administration showed a lack of urgency in its approach to Southeast Asia in its first six months in office. Moreover, the administration’s broader priorities — which emphasise working with major partners and fellow democracies to counter China globally, and do not include a strong economic agenda for the region — suggest a growing strategic divergence between Southeast Asian and US interests which may prove challenging for Washington to address.

A legacy of neglect

Allegations of neglect have characterised the United States’ engagement with Southeast Asia since at least the 1970s,⁶⁹ but President Biden inherited a particularly troubled legacy from his predecessor.⁷⁰ The Trump administration left ambassador posts such as Singapore vacant for the entirety of its administration⁷¹ and consistently snubbed the key regional meeting, the East Asia Summit.⁷² More importantly, following its withdrawal from the Trans-Pacific Partnership (TPP) in 2017, the United States never implemented a positive economic strategy for the region.⁷³ Such missteps contributed to a regional perception of declining US influence.⁷⁴ While the Trump administration successfully strengthened security ties with Vietnam, many Southeast Asian countries saw strident anti-China rhetoric from key figures like Secretary Pompeo as contributing to regional tensions.⁷⁵ Coming from this low base, most respondents to a late 2020 ISEAS survey of respondents from the ten ASEAN member states expected US engagement with Southeast Asia to increase in 2021 under Biden’s presidency.⁷⁶

Oversights like these prompted criticism from regional commentators that the United States risked “losing” to China and needed to act fast to redress a narrative of “neglect.”

Despite relative US inattention, China, Japan, India and Australia have all recognised Southeast Asia’s strategic importance and stepped-up diplomatic activity over the past four years. China’s face-to-face diplomacy with the region has maintained momentum throughout the pandemic. Since October 2020, Chinese Foreign Minister Wang Yi has visited every ASEAN country except Vietnam⁷⁷ and hosted the ASEAN foreign ministers for a meeting in Chongqing.⁷⁸ Likewise, Japan has treated Southeast Asia as an urgent foreign policy priority, as shown by Prime Minister Yoshihide Suga’s decision to make his first overseas trip as prime minister to Indonesia and Vietnam last October.⁷⁹ In late 2020, Australia announced more than A$550 million in development assistance for the region,⁸⁰ redressing criticism that it has focused on the Pacific at the expense of Southeast Asia.⁸¹

Yet the Biden administration was slow to engage with Southeast Asia. While Deputy Secretary of State Wendy Sherman visited three regional countries in May, no cabinet-level official visited until Secretary Austin went to Singapore, Vietnam and the Philippines in July. President Biden failed to make introductory phone calls with Southeast Asian counterparts,⁸² and an important meeting between Secretary Blinken and his ASEAN counterparts was repeatedly delayed.⁸³ Biden has not nominated ambassadors to its Southeast Asian alliance partners the Philippines or Thailand⁸⁴ — both of whom took note when they were not mentioned in the administration’s Interim National Security Strategic Guidance.⁸⁵ Oversights like these prompted criticism from regional commentators that the United States risked “losing” to China and needed to act fast to redress a narrative of “neglect.”⁸⁶

Signs of improvement

Since early July, the Biden administration has made substantial efforts to address these criticisms, which National Security Council Indo-Pacific Coordinator Kurt Campbell implicitly acknowledged when he signalled the administration’s intention to step up its game in Southeast Asia.⁸⁷ In mid-July, Blinken held a long-postponed meeting with ASEAN foreign ministers.⁸⁸ Two weeks later, Secretary Austin made a well-received visit to the region. His speech to the IISS Fullerton Forum in Singapore — which he was originally due to deliver at the cancelled Shangri-La Dialogue in May — emphasised the importance of partnerships to address the COVID-19 recovery and regional security challenges. Austin’s remarks about China were well-calibrated to Southeast Asian sensitivities. Specifically, the secretary said he was committed to a “constructive, stable” relationship with China and endorsed Singaporean Prime Minister Lee’s influential view that the United States should not ask regional countries to choose between it and China. Austin’s measured tone was welcomed by Southeast Asian expert commentators as evidence that the Biden team was listening to regional concerns.⁸⁹

Secretary of Defense Lloyd Austin and Executive Director of the International Institute for Strategic Studies (IISS) James Crabtree at an IISS event in Singapore, 27 July 2021Source: US Department of Defense

Austin’s subsequent visits to Vietnam and the Philippines were also well received. In Hanoi, he signed an agreement to cooperate on the location and identification of war remains,⁹⁰ while in Manila he secured a crucial outcome — an agreement by President Rodrigo Duterte not to abrogate the Visiting Forces Agreement (VFA), a vital framework enabling the US military presence in the Philippines.⁹¹ The US announced Vice President Kamala Harris’ visit to Singapore and Vietnam in August,⁹² helping to maintain momentum from the positive outcomes of the Austin visit.

Washington’s tardiness in engaging Southeast Asia suggests the benefits of doing so were not front of mind for an administration more focused on major traditional allies in Europe and Northeast Asia. The United States needed to be pushed through public criticism, and perhaps through private representations from partners, to focus on the region. Yet, the administration’s ability to course-correct suggests a willingness to adapt to changing circumstances which will help the United States succeed. And the warm reception that Austin received in Southeast Asia⁹³ may help encourage further administration attention, creating a positive foundation for personal relationships and trust to grow.

Challenges ahead

Notwithstanding these improvements, the Biden administration still has much work to do if it is to improve the United States’ position in Southeast Asia. By laying out a vision for US-Southeast Asia cooperation in Singapore, Austin established a foundation for further engagement with ASEAN and individual countries. But even signature achievements — like the agreement by Duterte to maintain the VFA — restore, rather than advance, the United States’ position. The US-Philippines alliance must now address challenging issues in the South China Sea and tackle the implementation of the Enhanced Defense Cooperation Agreement, a 2014 deal that has the potential to strengthen US military presence in the Philippines, including by rotating US forces and upgrading bases for joint use.⁹⁴ Progress on these fronts requires sustained investment.

The Biden administration’s lack of an economic strategy for the region also poses challenges. The Obama administration’s pivot to Asia — which was designed to make Southeast Asia the primary beneficiary — was driven by an understanding that the United States would benefit from deeper integration with growing economies in the Indo-Pacific, a belief that found its expression in the TPP.⁹⁵ Although it failed to deliver, this was the right approach. In a region that tends to value economic cooperation more highly than security cooperation,⁹⁶ the absence of a shared prosperity agenda makes it difficult for Washington to approach Southeast Asia in a positive way — rather than as a “derivative of strategic competition with China.”⁹⁷ The Biden administration has not set its sights on the TPP, lowering its ambition to explore a digital trade agreement instead. Even if it comes to fruition, Southeast Asia will see this as a weak substitute for a comprehensive approach to economic cooperation, especially to promote recovery from COVID-19.

Biden’s emphasis on revitalising democracy around the world does not naturally lend itself to a focus on a region that is home to only one full democracy.⁹⁸ Pragmatically, Austin’s Singapore speech did not repeat the administration’s rhetoric defining competition with China as one between democracy and autocracy — an implicit concession that this framing will not work in Southeast Asia. The administration has also shown pragmatism in other aspects of its engagement. For example, in responding to the February 2021 coup in Myanmar, Washington supported the ASEAN-led response⁹⁹ and has not allowed the presence of Myanmar junta representatives to deter it from participating in ASEAN meetings.¹⁰⁰ A visit to Cambodia by Deputy Secretary Sherman, the highest-level visit to that country in a decade,¹⁰¹ may also indicate the Biden team’s intention to engage rather than isolate countries with poor human rights records. For the time being, the administration has managed the tension between its ideological framing of the China challenge and the preferences of Southeast Asian countries. But this will continue to be a tightrope for the United States to walk. If the Biden team does not come to see Southeast Asia as sufficiently supportive of its global priorities, it is likely to focus its efforts elsewhere — leaving the region once again as a second-order task for US foreign policy.

5. No regional economic strategy

The weakest aspect of the Biden administration’s approach to the Indo-Pacific is its failure to develop a comprehensive strategy for economic engagement. President Biden and national security officials have acknowledged the need to compete with China’s Belt and Road Initiative, flagging new areas of possible cooperation on digital standards and infrastructure. Yet the administration’s protectionist outlook, couched as “worker-centric trade policy,” will likely stymy new trade agreements. This will leave the United States government in the anaemic position it has occupied since withdrawing from the Trans-Pacific Partnership (TPP) in 2017 — damaging its standing in a region where most governments remain strongly committed to rules-based trade liberalisation.¹⁰²

Sitting out of regional trade

The United States’ private sector presence in the Indo-Pacific remains strong. It is the largest investor in ASEAN, with a total stock of investment valued at US$328.5 billion in 2020. Over the past decade, however, the United States has become less important as a source of final demand for products exported from the region.¹⁰³ The Trump administration’s withdrawal from the TPP — the signature economic initiative of the Obama administration — has placed the United States outside two major regional trade initiatives: the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP), signed by other TPP members in 2018, and the ASEAN-led Regional Comprehensive Economic Partnership, signed by 15 countries in 2020. The United States’ absence from both deals has left it disengaged from the major venues for standard-setting and economic negotiations.

Japan, Australia and other US partners in the Indo-Pacific would welcome Washington’s interest in joining the CPTPP.¹⁰⁴ America’s membership would almost triple the size of the economic bloc¹⁰⁵ and would signal US recommitment to economic multilateralism and rules-based trade. However, early speeches from Biden, Blinken and US Trade Representative Katherine Tai signalled caution about joining trade agreements, citing concerns about the impact previous deals had on workers and small businesses. The administration has also allowed the Trade Promotion Authority (TPA) — a provision enabling streamlined legislative review of trade agreements — to lapse, making any moves to advance a regional trade agenda more difficult.¹⁰⁶ In lieu of considering comprehensive trade agreements requiring legislative approval, the administration has said it is exploring a digital trade agreement with Indo-Pacific partners, which is an emerging area of regional standard-setting.¹⁰⁷ While such an agreement is not without sensitivities,¹⁰⁸ it could be negotiated without TPA.¹⁰⁹ But even this modest goal has proved contentious within the administration, with the US Trade Representative reportedly unsupportive of national security officials’ desire to negotiate such an agreement.¹¹⁰ Even if such an agreement were negotiated, its narrow focus is unlikely to satisfy countries seeking more comprehensive economic engagement from the United States.

President Joe Biden signs an executive order related to American manufacturing at the White House, 25 January 2021Source: Getty

Effective and high-level coordination of whole-of-government efforts from the White House is urgently needed to ensure that domestic protectionism does not undermine initiatives that would be essential to a successful Indo-Pacific strategy. While national security officials appreciate the importance of regional economic engagement to drive growth and set standards in the region, economic agencies — the Department of the Treasury, Department of Commerce and Office of the United States Trade Representative — are prioritising trade policies that they say will create material gains for American workers, shield the American technology and innovation base from national security threats and control the flow of strategic technological knowledge to China.¹¹¹

Global infrastructure is not sufficient

In the absence of a positive trade agenda for the region, the Trump administration came to see infrastructure investment as a key vector for competition with China. Through the establishment of the International Development Finance Corporation (IDFC) under the BUILD Act in 2019, the United States sought to lower the barriers for US private sector investment in regional infrastructure in Asia, including by enabling it to make equity investments and more than doubling its investment cap.¹¹² The Blue Dot Network initiative aimed to establish a scheme for certifying infrastructure projects that met standards and principles in areas like sustainability and transparency.¹¹³ And by working with Australia and Japan under a trilateral partnership, the administration sought to multiply its efforts. But these initiatives were described by a Council on Foreign Relations task force in March 2021 as “scattershot” and “insufficient,” with inadequate resourcing and insufficient coordination with US allies and partners.¹¹⁴

There is a perception that it is too similar to Trump’s infrastructure initiatives which failed to deliver specific projects.

Like the Trump administration, the Biden administration has set itself the goal of competing with China’s Belt and Road Initiative. President Biden’s signature Build Back Better World (B3W) initiative, announced at the G7 summit in Cornwall, is a continuation of existing US infrastructure initiatives, albeit now in concert with G7 countries. Like the BUILD Act, the B3W aims to mobilise private sector capital to fund infrastructure projects. It will focus on funding projects in low- and middle-income countries across four priority areas: climate change; health; digital technology; and gender equality and education.¹¹⁵ The Biden administration has said it intends to apply B3W by leveraging the IDFC more effectively in Southeast Asia and has foreshadowed further Indo-Pacific infrastructure announcements will be made at a summit of Quad leaders later in 2021.¹¹⁶

But B3W faces some scepticism from likely recipient countries in the Indo-Pacific region.¹¹⁷ There is a perception that it is too similar to Trump’s infrastructure initiatives which failed to deliver specific projects. Leaders in Cornwall did not announce any specific contributions to the B3W by other G7 countries, though have committed to forming a task force with the aim of announcing substantive projects by the next G7 summit in Germany.¹¹⁸ Unless European partners make substantial financial commitments, the global, rather than regional, focus of the B3W risks diluting the level of US resourcing available for infrastructure in the Indo-Pacific — the region where economic competition with China is most important.

6. Lacking urgency on defence

The Biden administration has, so far, placed less focus on Indo-Pacific defence challenges than global security concerns.¹¹⁹ Although the Pentagon describes China as its “pacing threat,” Secretary of Defense Lloyd Austin’s Message to the Force in March and the president’s 2022 defence budget request both put competition with China on an equal footing to climate change and COVID-19.¹²⁰ The administration insists its flat defence budget can fulfil the United States’ global strategic responsibilities,¹²¹ even as some officials and bipartisan strategy assessments suggest hard choices are needed.¹²² Meanwhile, Austin has emerged as a leading voice for expanding the Defense Department’s supportive role across a range of non-military domestic and international challenges.¹²³

These early moves suggest that the Biden administration lacks a sense of urgency about China as a near-term military competitor.¹²⁴ From a defence planning standpoint, the Pentagon is more focused on preparing for high-intensity conflict with China in the 2030s than meeting grey-zone and conventional deterrence challenges this decade.¹²⁵ Its vague new concept of “integrated deterrence” — which implies networking allied contributions across a multi-dimensional spectrum of competition — does little to build confidence.¹²⁶ If the Biden team is serious about preserving a favourable balance of power in the region and incentivising greater allied collaboration, it will need to invest more heavily in near-term Indo-Pacific defence needs.

Prioritising the future China challenge

There is no consensus in US defence circles on when China might pose a military threat in the region. Successive leaders at US Indo-Pacific Command (INDOPACOM) and other senior officials have conveyed a sense of urgency, with some warning a high-end conflict could break out as early as the late-2020s.¹²⁷ By contrast, Secretary Austin and Chairman of the Joint Chiefs of Staff Mark Milley have taken a long-term view, questioning whether China would have the capacity or willingness to launch a major offensive campaign this decade.¹²⁸

Biden’s 2022 defence budget request adopts this long-term view and treats China primarily as a future military challenge. It prioritises investments in modernisation intended to come online next decade, including a record US$112 billion for research and development to prepare the armed forces for high-tech warfighting in the 2030s.¹²⁹ To pay for these priorities, it aims to reduce legacy air and naval force structure — that is, fighters, bombers and warships — without a corresponding boost to new procurement programs. This would result in a smaller, older and overworked force.¹³⁰ While the final budget authorisation will address some of these concerns, the overall emphasis on long-term military modernisation over present-day force structure is likely to continue in some form.¹³¹ This suggests near-term defence challenges in the Indo-Pacific are not a high priority for the administration, even as regional allies like Japan and Australia are increasingly worried about the rapidly deteriorating strategic environment.¹³²

From a defence planning standpoint, the Pentagon is more focused on preparing for high-intensity conflict with China in the 2030s than meeting grey-zone and conventional deterrence challenges this decade.

The Pentagon’s effort to dissolve the Pacific Deterrence Initiative (PDI) into its future-oriented budget reinforces this judgement about the administration’s long-term priorities. Established with bipartisan congressional support by former INDOPACOM commander Admiral Philip Davidson, the PDI was intended to bolster near-term deterrence by investing in: resilient and distributed military posture west of Hawaii; regional stocks of munitions, fuel and logistics enablers; integrated air defences and radars; and more exercises and capacity-building with allies and partners.¹³³ Yet most of the administration’s US$5.1 billion PDI request channels funding into research and procurement accounts that are untethered to the region.¹³⁴ The Pentagon has said it will work with Congress to “amend any perceived misalignments.”¹³⁵ But its mishandling of a key military initiative for competing with China in the short-term has dented confidence in the administration’s regional defence strategy.¹³⁶

Changing concepts of deterrence

This incident also raises concerns about Washington’s commitment to a regional defence strategy based on deterrence by denial. The Trump administration’s 2018 National Defense Strategy (NDS) underscored the need to prevent China from securing fait accompli outcomes in regional flashpoints, like Taiwan and the South China Sea, by denying it the ability to exploit speed, surprise and local military superiority.¹³⁷ This is the United States’ best option for constraining Chinese power given its irrevocable loss of all-domain military dominance.¹³⁸ Implementing this strategy requires substantial investment in distributed and resilient basing, forward-based precision strike networks, increased fuel and munitions stocks, integrated air defence systems and more.¹³⁹

Secretary of Defense Lloyd Austin is escorted by Lt. Gen. Erickson Gloria, Vice Chief of the Staff Armed Forces of the Philippines, Manila, 30 July 2021Source: US Department of Defense

As many of these priorities fall within the PDI, the administration’s decision not to fund it properly raises questions about its buy-in to the overall strategy — particularly as some priorities, like enhanced forward posture, are not funded elsewhere in the request.¹⁴⁰ Senior defence officials continue to affirm a denial-based strategy in public.¹⁴¹ But coupled with reports that some Pentagon offices are advising against increased US posture west of the dateline on the grounds that forward-deployed forces would be too vulnerable to Chinese strike systems, the administration’s support for this strategy is at least uncertain.¹⁴²

The administration, however, is moving to adopt a new concept of “integrated deterrence” in its own NDS, expected early next year.¹⁴³ Presented as a way of countering China’s multi-dimensional coercion by combining allies and partners, interagency actors, military and non-military tools and multi-domain operations into a singular approach, the concept has been widely condemned as unwieldy even before its release.¹⁴⁴ This is a distinct risk. Yet such an approach could prove to be valuable if it is accompanied by efforts to integrate close allies into US military and strategic planning at the concept development stage — particularly around grey-zone challenges and conventional deterrence scenarios.¹⁴⁵ By contrast, if “integrated deterrence” remains a vague framework for whole-of-government strategies towards China, or one that is perceived to give up on the role of military denial in high-end Western Pacific scenarios, it will be of little value to Indo-Pacific allies and partners.¹⁴⁶

Staying focused on the region

Whether Biden’s defence team will prioritise the Indo-Pacific ahead of other regions is an open question.¹⁴⁷ Defence officials and budget documents have framed the Indo-Pacific as the United States’ “priority theatre.”¹⁴⁸ But Europe and the Middle East remain perennial distractions. While the end of hostilities in Afghanistan was intended to free up resources for defence priorities in the Indo-Pacific, the administration’s botched withdrawal has produced a volatile situation that is likely to sap the attention of senior leaders for some time. Ongoing military operations elsewhere in the Middle East mean there will only be a minimal reduction in America’s regional footprint and constant potential for increased involvement.¹⁴⁹ Although the Pentagon’s current defence strategy is premised on a “one-great power war” force planning construct, the Biden administration worries about Russian revanchism more than its predecessor, and may seek to plan for a “two-front” war construct during the NDS process.¹⁵⁰ In light of the United States’ spiralling debt and flatlining defence budget, such an approach could dilute the administration’s planning focus on major China contingencies in the Indo-Pacific.

While the end of hostilities in Afghanistan was intended to free up resources for defence priorities in the Indo-Pacific, the administration’s botched withdrawal has produced a volatile situation that is likely to sap the attention of senior leaders for some time.

Few tangible signs suggest that the United States is moving to increase force posture and capacity-building programs in the Indo-Pacific relative to other global priorities.¹⁵¹ Although the administration has yet to complete its global force posture review,¹⁵² appropriations to date for the PDI amount to less than a tenth of the nearly US$30 billion appropriated for the European Deterrence Initiative since 2016.¹⁵³ Capacity-building has not featured prominently in the administration’s discourse on regional security challenges, while budget documents flag only US$179 million in Foreign Military Financing for the Indo-Pacific in FY22 compared with nearly US$300 million for Europe and US$5.46 billion for the Middle East.¹⁵⁴ Although the Innovation and Competition Act contains substantial funding for regional defence initiatives out to 2026 — including US$2 billion annually for the Asia Reassurance Initiative Act — funding for the Indo-Pacific Maritime Security Initiative remains flat.¹⁵⁵ These are not encouraging signs that Washington is serious about increasing investment in the Indo-Pacific when it comes to practical defence requirements.

Recommendations for the Biden administration

The Biden administration has an opportunity to correct the course of US strategy in the Indo-Pacific region. Yet despite the administration’s deep regional expertise and the region’s high expectations, its actions in its first six months in office lacked focus and urgency. Washington prioritised long-term, global systems competition with Beijing above a competitive strategy to constrain China’s fast-growing regional influence. The following recommendations would better position the United States to leverage the strength of its allies and partners, increase its economic influence and demonstrate its commitment to an enduring security presence.

1. The Biden administration should clearly identify the Indo-Pacific region as its foreign and defence policy priority and marshal resources accordingly.

The Biden administration’s Interim National Security Strategic Guidance identified China as the only competitor capable of mounting a sustained challenge to a stable and open international system. But while China poses a potential long-term global challenge to the United States’ strategic position, it is already reshaping the military balance of power and economic relations in the Indo-Pacific region.

Despite the inroads China is making, longstanding US ambitions to pivot resources and attention to the Indo-Pacific are yet to be realised, and the administration has not clearly identified the region as the focus of its foreign and defence policies. On the contrary, the Biden team’s diplomacy and defence policy to date suggest the Indo-Pacific is being treated as one important area of focus, rather than the decisive priority.

Moreover, the administration’s policies and programs to counter China’s influence are largely geared at the global level. This includes the Build Back Better World initiative, coordinated statements on cyber activities and human rights, and efforts to compete on technology. The administration must complement these efforts with specific initiatives to counter China’s growing regional influence.

2. The Biden administration should articulate clear goals for its relationship with China and for its desired strategic position in the Indo-Pacific region.

The Biden administration needs to articulate clear objectives for strategic competition with China in order to gain buy-in from regional allies and partners. Senior officials have said the United States’ relationship with China will include elements of competition, collaboration and confrontation. But beyond the avoidance of conflict, the administration is yet to articulate the end-state it seeks to achieve.

Close allies such as Australia and Japan, at a minimum, should be thoroughly briefed on US objectives in order to inform their own strategic planning. The “steady state of clear-eyed coexistence on terms favourable to US interests and values” articulated by administration officials before taking office does not provide adequate certainty about how the Biden administration will measure its own success vis-à-vis China.¹⁵⁶

Rather than seeking to regain pre-eminence in the Indo-Pacific, the United States should aim to maintain a favourable regional balance of power — one in which China is prevented from becoming a regional hegemon with its own sphere of influence, and where third countries are able to make alignment decisions that constrain China’s power and deepen cooperation with the United States and other allies and partners.

Approaches previously articulated by administration officials on the United States’ role in the “Asian order” offer a useful starting point, including: restoring the regional military balance by investing in asymmetric capabilities and partnering with allies to collectively deter China’s adventurism; reversing the trend towards the emergence of a Chinese regional sphere of economic influence; and persuading China to play a constructive role in a regional order which is “competitive but peaceful.”¹⁵⁷

3. The Biden administration should avoid emphasising ideological competition with China and instead focus on maximising its influence by responding to regional needs.

The Biden administration should refrain from emphasising the ideological elements of competition with China in the Indo-Pacific. Casting the choice between the United States and China as a struggle between “democracy and autocracy” misunderstands the nature of China’s influence in the region, which is largely economic and transactional. This zero-sum framing also risks limiting the size of a US-led coalition in the Indo-Pacific region, given the dearth of liberal democracies and countries’ desire to retain autonomy and space to work with both major powers.

Instead, the United States needs to lead with a trade and investment strategy for the region, premised on mutual benefit and prosperity, and underscored by a strong commitment to regional security. Both should be defined in terms of principles, not democratic values. Constant attention will also be required to deconflict the administration’s ideological and strategic narratives, especially when engaging with Southeast Asia.

4. The Biden administration should signal its commitment to a strategy of deterrence by denial to prevent Chinese aggression and bolster its investments in Western Pacific military posture to reinforce its credibility.

As part of identifying the Indo-Pacific as its top priority, the Biden administration needs to treat China as both a near-term and long-term military challenge. Deterrence by denial should be the strategy in both cases. Preventing China from achieving fait accompli outcomes by force is the most credible way to uphold a favourable balance of power in the absence of all-domain military dominance. It is also the best way to assure regional allies and partners.

A denial strategy requires a resilient and distributed forward posture in the Western Pacific. The administration should appropriately fund the posture, munitions, logistics and exercise initiatives requested by US Indo-Pacific Command through the Pacific Deterrence Initiative to signal its commitment to regional deterrence this decade.¹⁵⁸

Reaffirming deterrence by denial in the next US National Defense Strategy, due in 2022, would help guide US lawmakers to invest in the capabilities, munitions, infrastructure, logistics and partnerships necessary to achieving that strategy.¹⁵⁹ It would also send a strong signal to regional allies and partners that the United States is committed to their enduring defence interests.

5. The Biden administration should empower its allies to assume greater responsibility for their own defence requirements by reducing legislative and political obstacles to allied self-strengthening.

The Biden administration should support the efforts of Indo-Pacific allies and partners to assume greater responsibility for their own defence requirements. This means overcoming Washington’s preference for tightly controlling the flow of defence technology and technical know-how to close allies and partners. Failure to do so will increasingly undermine US and allied interests in collective defence.

Washington should accelerate reforms to pre-existing mechanisms such as the National Technology and Industrial Base framework and the Foreign Military Sales program in order to boost allied capacity by expanding access to intellectual property and lowering the cost of doing business with US entities. This will likely require overcoming political resistance and deconflicting these efforts from the Biden administration’s “Buy American” rules.

Washington will also need to “step out” of the way of allies’ attempts to enhance their own capabilities, even if these do not entirely suit US preferences. Doing so will be necessary to preserve positive trends in emerging strategic relationships, and to avoid being shut out of allies’ own niche technological and capability development programs.¹⁶⁰

US Trade Representative Katherine TaiSource: Getty

6. The Biden administration should pay special attention to Southeast Asia as a region of strategic importance, given its geography, size and the fluidity of its alignment dynamics.

Southeast Asia does not offer ready wins like partnering with major allies. But neglect risks eroding regional countries’ preferences for partnering with the United States, which could impact future military access and diplomatic influence. The administration’s strategy needs to prioritise Indonesia, as the region’s most important country, as well as the Philippines and Vietnam as key South China Sea claimant states with underlying interests that are in line with US approaches to China.

Key tools for the United States include appointing ambassadors to empty posts, increasing political-level contact with regional heads of government and ministers, more effective use of ASEAN-related forums and meetings, and a stepped-up effort to support the COVID-19 response, including assistance with vaccines and investment to promote economic recovery. The United States should continue to develop its partnership with Mekong countries to avoid the risk of mainland Southeast Asian countries playing a spoiler role and undermining Washington’s ability to engage with ASEAN as a whole.

7. The Biden administration should clearly signal it is committed to mutually beneficial economic engagement with the Indo-Pacific and adopt trade and investment strategies that reinforce its role as an indispensable resident economic power.

Rather than continuing to retreat from regional economic integration, the Biden administration must demonstrate it intends to benefit from and contribute to economic dynamism in the Indo-Pacific. A clear statement that the United States sees its presence in the region as advancing the prosperity of the American people would bolster regional confidence in the durability of US commitment and reinforce its status as a resident power. Even extensive development assistance and other forms of support cannot compensate for the lack of an economic approach to the region based on mutual self-interest.

Renewed US economic engagement would show the administration is listening to regional priorities, rather than imposing its own. Indo-Pacific countries are overwhelmingly focused on economic survival through COVID-19. The administration should identify pathways to join a renegotiated Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), recognising the deal’s unique potential importance for standard-setting and way of enmeshing the United States in regional economic arrangements. A digital trade agreement, if pursued, should be a stepping-stone to joining a renegotiated CPTPP, rather than an end in itself.

The United States should treat cooperation on infrastructure as a supplement, rather than an alternative, to a robust regional trade strategy. Given the failure of earlier US infrastructure initiatives to deliver results, and the long timelines and uncertainty associated with deploying private capital for infrastructure projects in developing countries, the Biden administration should avoid raising expectations that it will be able to quickly deliver high-profile projects to compete with China’s Belt and Road Initiative. It should, however, seek to use the Build Back Better World (B3W) initiative to make long-term investments in key Indo-Pacific countries of strategic importance. It should also ensure the global focus of the B3W does not dilute from project funding available for countries in the Indo-Pacific.