ASEAN
11 April 2026
Australia’s China-threat runs through Southeast Asia
Should Australia feel threatened by the rise of China?
Should Australia feel threatened by the rise of China?
Yes indeed, argues Michael Wesley in a recent Quarterly Essay, “Blind Spot: Southeast Asia and Australia’s Future”. But it’s a different type of threat from those most commonly discussed by Australia’s voluble commentariat. Australia’s China threat would run through Southeast Asia according to Wesley, Deputy Vice Chancellor at the University of Melbourne, Australia.
According to Australia’s security and intelligence agencies, China would be building the capability to infiltrate and subvert Australia's basic institutions – meaning undermining the established system and institutions. But Wesley is not convinced, as little detail has been offered by security and intelligence agencies. He argues that the best way of countering attempted subversion is to build our resilience. We should be proud of institutions like the Australian Electoral Commission which keep our elections extremely fair and free of external influence.
Australia was subject to economic coercion from China in response to Australia’s call for an independent, international enquiry into the origins of Covid-19. But Wesley argues that this coercion did not work! The Productivity Commission estimated Australia’s GDP only suffered by one percent, and Australia did not give into any of China's demands.
Wesley concedes that China has the ability to undertake a military attack on Australia, particularly from its air strips in the South China Sea. But he believes the only conceivable scenario would be if China was at war with the US, and wanted to take out the US intelligence stations and bases on our soil.
What does he mean by a sphere of influence? While spheres of influence can take many forms, the commonality is the desire to exclude other powers. This would mean kicking the US out of Asia, which would necessarily have knockon effects for Australia, given its close alliance with the US – and despite Australia having security commitments with several Southeast Asian countries.
Kicking the US out of Southeast Asia may not be a difficult task. The US has never taken Southeast Asia seriously. It sees Southeast Asia as a strategic backwater and has often deferred to Australia to keep an eye on the region. Northeast Asia represents the main challenges to American power, the main sources of American wealth in Asia, and the home to America’s strategic Asian commitments.
As a “zone of deference”, Southeast Asian countries would defer to China's interests and wishes in the broader world. Big decisions could not be made without some kind of nod from Beijing. Thus, China could conceivably ask Southeast Asian countries to isolate Australia. At this stage, such Chinese ambitions are more present in continental than maritime Southeast Asia, especially Cambodia, Laos and Myanmar.
Southeast Asia is a natural place for a Chinese sphere of influence. It has dense infrastructure and economic linkages with Southeast Asia, and ethnic ties due to Chinese migration over time. Some 70 percent of people of Chinese descent who live outside of China actually live in Southeast Asia. Southeast Asia is also a strategic location linking the Indian and Pacific Oceans and through which much energy trade passes. Thus, it is a source of perpetual anxiety in Beijing which fears that a hostile power might close off the trade route.
China’s political intentions have been made clear by Chinese leader Xi Jinping when he talks of a "new Asian security concept" often dubbed "Asia for Asians," arguing that regional affairs should be managed by Asian nations rather than external powers.
And yet Australia has been perennially “underdone” in Southeast Asia, whether it be in trade and investment linkages, or diplomatic and defense relations. A succession of reports have been written over the years highlighting the importance of improving Australia’s economic and strategic ties with Southeast Asia – but to little effect.
Why does Australia overlook its closest neighbours? Wesley offers three reasons. First, Northeast Asia has been the major source of Australia’s postwar prosperity, starting with Japan, Korea and Taiwan, and then China. Second, since colonial times, Australia has had a Western ally – first the UK and then the US – assuring Australia’s security. This means that Australia’s security policy has tended to follow the priorities of its ally more than its own – as manifest in Australia’s participation in America’s Middle East wars, as well as the AUKUS agreement. Third, Southeast Asia has largely been a benign strategic environment for several decades, meaning that there has been little to worry about.
One factor dividing Southeast Asia and Australia is Australia’s decision to align itself with the US in confronting a rising China, notably through AUKUS. Southeast Asian countries think that confrontation with China is dangerous and will not work. They are more than happy to say no to China but unlike Australia they will not stand up and say it ostentatiously. There is alarm in Southeast Asia when Australia starts to talk about the inevitability of war with China. What worries them about Australia's close adherence to American strategy in Asia is that it will draw them into a war. Southeast Asians are adopting a strategy of omnibalancing.
Wesley argues that Australia has much to do to build more influence in Southeast Asia, and reduce the risk of being marginalised by a potential Chinese zone of deference. Australia needs to build a sense within Southeast Asia that it is an indispensable partner – for the economy, development, diplomacy, and security – even if Australia does not have a complementary relationship with the economy of Southeast Asia.
As Wesley writes, there are structural factors that represent a great challenge for Australia – namely its weak economic complementarity with Southeast Asia and Australia’s historic political alignment with the US and other Western countries.
Australia needs to come to terms with the reality that it is a declining power in relative terms, as Southeast Asia countries power ahead with their catchup growth. This means that over time, Australia will become less and less important for Southeast Asia. At the same time, Southeast Asia may become ever more important to Australia, if the US continues with its unreliable and erratic behaviour.
Australians may seek solace in the fact that its GDP per capita and education levels are much higher than all Southeast Asian countries, except for Singapore. But Southeast Asian elites, some of whom studied in Australia, tend to be very sophisticated and very often know Australia much better than Australians know Southeast Asia.
In sum, Australia has much work to do to improve its Southeast Asian literacy. This will include approaching Southeast Asia with a greater degree of modesty. In doing so, Australia’s foreign policy must be based more on our national interests than our “values”, since few Southeast Asian countries share our political values.
Australia can be proud of being ranked as a “full democracy” by the Economist Intelligence Unit, but no Southeast Asian country is given the same ranking. The region is a mixed bag of flawed democracies, hybrid and authoritarian regimes.
When Western countries like Australia offer Southeast Asia advice on democracy and human rights, it is not always well received. Indeed, a key component of the "ASEAN Way" is ASEAN’s non-interference policy, a foundational principle prohibiting member states from intervening in the internal affairs of others, aiming to ensure sovereignty, stability, and peaceful relations (ASEAN, Association of Southeast Asian Nations).
The Southeast Asian typical approach of strategic autonomy and seeking good relations with all world powers can imply ambiguity, which countries like Australia must learn to live with. For example, Indonesia has joined the BRICS, an intergovernmental organisation comprising major emerging economies, aiming to counterbalance to Western-dominated global institutions. At the same time, Indonesia is advancing its accession process to the OECD, the bastion of Western-advanced democracies.
Building Australia’s influence in Southeast Asia means that Australia must invest more in its diplomacy and official development assistance, as well as fostering Southeast Asian literacy at home. The Southeast Asian imperative will thus have to compete with other demands on the Commonwealth government’s budget. But if Australia is keen to ensure a viable future, it must invest in that future.
One issue that Wesley does not address is that of natural disasters. Southeast Asia is one of the world's most disaster-prone regions, frequently facing earthquakes, tsunamis, volcanic eruptions, and severe hydro-meteorological events like typhoons and floods, with Indonesia and the Philippines being particularly vulnerable. As global warming advances, Southeast Asia will likely suffer even more than it has in the past. Neighbours like Australia will inevitably have to accept the responsibility of offering more assistance than in the past and possibly accepting natural disaster refugees.
Yes indeed, argues Michael Wesley in a recent Quarterly Essay, “Blind Spot: Southeast Asia and Australia’s Future”. But it’s a different type of threat from those most commonly discussed by Australia’s voluble commentariat. Australia’s China threat would run through Southeast Asia according to Wesley, Deputy Vice Chancellor at the University of Melbourne, Australia.
False China threats
Wesley identifies four possible China threats to Australia, namely subversion, coercion, direct attack, and “reshaping our region”. But he insists that Australia has overestimated and overreacted to the first three China threats. In many ways we have lost our sense of proportion regarding the China threats.According to Australia’s security and intelligence agencies, China would be building the capability to infiltrate and subvert Australia's basic institutions – meaning undermining the established system and institutions. But Wesley is not convinced, as little detail has been offered by security and intelligence agencies. He argues that the best way of countering attempted subversion is to build our resilience. We should be proud of institutions like the Australian Electoral Commission which keep our elections extremely fair and free of external influence.
Australia was subject to economic coercion from China in response to Australia’s call for an independent, international enquiry into the origins of Covid-19. But Wesley argues that this coercion did not work! The Productivity Commission estimated Australia’s GDP only suffered by one percent, and Australia did not give into any of China's demands.
Wesley concedes that China has the ability to undertake a military attack on Australia, particularly from its air strips in the South China Sea. But he believes the only conceivable scenario would be if China was at war with the US, and wanted to take out the US intelligence stations and bases on our soil.
Southeast Asia, a “zone of deference” for China
The key to Wesley’s case is his view that China is seeking to establish a sphere of influence in Southeast Asia – or a “zone of deference” in his words – something which is typical for a rising great power. The more power that rising powers acquire, the more vulnerable they typically feel.What does he mean by a sphere of influence? While spheres of influence can take many forms, the commonality is the desire to exclude other powers. This would mean kicking the US out of Asia, which would necessarily have knockon effects for Australia, given its close alliance with the US – and despite Australia having security commitments with several Southeast Asian countries.
Kicking the US out of Southeast Asia may not be a difficult task. The US has never taken Southeast Asia seriously. It sees Southeast Asia as a strategic backwater and has often deferred to Australia to keep an eye on the region. Northeast Asia represents the main challenges to American power, the main sources of American wealth in Asia, and the home to America’s strategic Asian commitments.
As a “zone of deference”, Southeast Asian countries would defer to China's interests and wishes in the broader world. Big decisions could not be made without some kind of nod from Beijing. Thus, China could conceivably ask Southeast Asian countries to isolate Australia. At this stage, such Chinese ambitions are more present in continental than maritime Southeast Asia, especially Cambodia, Laos and Myanmar.
Southeast Asia is a natural place for a Chinese sphere of influence. It has dense infrastructure and economic linkages with Southeast Asia, and ethnic ties due to Chinese migration over time. Some 70 percent of people of Chinese descent who live outside of China actually live in Southeast Asia. Southeast Asia is also a strategic location linking the Indian and Pacific Oceans and through which much energy trade passes. Thus, it is a source of perpetual anxiety in Beijing which fears that a hostile power might close off the trade route.
China’s political intentions have been made clear by Chinese leader Xi Jinping when he talks of a "new Asian security concept" often dubbed "Asia for Asians," arguing that regional affairs should be managed by Asian nations rather than external powers.
Australia and Southeast Asia
A Chinese “zone of deference” in Southeast Asia could be very problematic for Australia. A large share of its exports pass through Southeast Asia to its Northeast Asian markets. A large share of Australia’s air links go over Southeast Asia. Australia risks facing diplomatic isolation in its region. Wesley argues that Australia suffers from a deep anxiety about being excluded from Asia.And yet Australia has been perennially “underdone” in Southeast Asia, whether it be in trade and investment linkages, or diplomatic and defense relations. A succession of reports have been written over the years highlighting the importance of improving Australia’s economic and strategic ties with Southeast Asia – but to little effect.
Why does Australia overlook its closest neighbours? Wesley offers three reasons. First, Northeast Asia has been the major source of Australia’s postwar prosperity, starting with Japan, Korea and Taiwan, and then China. Second, since colonial times, Australia has had a Western ally – first the UK and then the US – assuring Australia’s security. This means that Australia’s security policy has tended to follow the priorities of its ally more than its own – as manifest in Australia’s participation in America’s Middle East wars, as well as the AUKUS agreement. Third, Southeast Asia has largely been a benign strategic environment for several decades, meaning that there has been little to worry about.
One factor dividing Southeast Asia and Australia is Australia’s decision to align itself with the US in confronting a rising China, notably through AUKUS. Southeast Asian countries think that confrontation with China is dangerous and will not work. They are more than happy to say no to China but unlike Australia they will not stand up and say it ostentatiously. There is alarm in Southeast Asia when Australia starts to talk about the inevitability of war with China. What worries them about Australia's close adherence to American strategy in Asia is that it will draw them into a war. Southeast Asians are adopting a strategy of omnibalancing.
Wesley argues that Australia has much to do to build more influence in Southeast Asia, and reduce the risk of being marginalised by a potential Chinese zone of deference. Australia needs to build a sense within Southeast Asia that it is an indispensable partner – for the economy, development, diplomacy, and security – even if Australia does not have a complementary relationship with the economy of Southeast Asia.
Australia’s Southeast Asian challenge
Wesley’s Quarterly Essay offers a very insightful analysis of a plausible scenario – namely that Australia risks political isolation from Southeast Asia if China establishes a “zone of deference” – which should make Australian policymakers shake in their boots and think deeply about building more influence in Southeast Asia.As Wesley writes, there are structural factors that represent a great challenge for Australia – namely its weak economic complementarity with Southeast Asia and Australia’s historic political alignment with the US and other Western countries.
Australia needs to come to terms with the reality that it is a declining power in relative terms, as Southeast Asia countries power ahead with their catchup growth. This means that over time, Australia will become less and less important for Southeast Asia. At the same time, Southeast Asia may become ever more important to Australia, if the US continues with its unreliable and erratic behaviour.
Australians may seek solace in the fact that its GDP per capita and education levels are much higher than all Southeast Asian countries, except for Singapore. But Southeast Asian elites, some of whom studied in Australia, tend to be very sophisticated and very often know Australia much better than Australians know Southeast Asia.
In sum, Australia has much work to do to improve its Southeast Asian literacy. This will include approaching Southeast Asia with a greater degree of modesty. In doing so, Australia’s foreign policy must be based more on our national interests than our “values”, since few Southeast Asian countries share our political values.
Australia can be proud of being ranked as a “full democracy” by the Economist Intelligence Unit, but no Southeast Asian country is given the same ranking. The region is a mixed bag of flawed democracies, hybrid and authoritarian regimes.
When Western countries like Australia offer Southeast Asia advice on democracy and human rights, it is not always well received. Indeed, a key component of the "ASEAN Way" is ASEAN’s non-interference policy, a foundational principle prohibiting member states from intervening in the internal affairs of others, aiming to ensure sovereignty, stability, and peaceful relations (ASEAN, Association of Southeast Asian Nations).
The Southeast Asian typical approach of strategic autonomy and seeking good relations with all world powers can imply ambiguity, which countries like Australia must learn to live with. For example, Indonesia has joined the BRICS, an intergovernmental organisation comprising major emerging economies, aiming to counterbalance to Western-dominated global institutions. At the same time, Indonesia is advancing its accession process to the OECD, the bastion of Western-advanced democracies.
Building Australia’s influence in Southeast Asia means that Australia must invest more in its diplomacy and official development assistance, as well as fostering Southeast Asian literacy at home. The Southeast Asian imperative will thus have to compete with other demands on the Commonwealth government’s budget. But if Australia is keen to ensure a viable future, it must invest in that future.
One issue that Wesley does not address is that of natural disasters. Southeast Asia is one of the world's most disaster-prone regions, frequently facing earthquakes, tsunamis, volcanic eruptions, and severe hydro-meteorological events like typhoons and floods, with Indonesia and the Philippines being particularly vulnerable. As global warming advances, Southeast Asia will likely suffer even more than it has in the past. Neighbours like Australia will inevitably have to accept the responsibility of offering more assistance than in the past and possibly accepting natural disaster refugees.