Southeast Asia's balancing act with China threatened by Western aid cuts
Southeast Asia and
China , according to findings from a study on the region's approach to China's aid.
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The study also found that countries had different strategies for accepting aid from Beijing. Southeast Asian states with acute development needs and constrained access to development financing, such as Cambodia, Laos and Myanmar, were found to be the most reliant on China.
The findings, released on March 26, came from the report 'Hedging bets: Southeast Asia's approach to China's aid' by Lowy Institute's analysts Alexandre Dayant and Grace Stanhope.
Meanwhile, lower-middle-income countries with more diverse foreign relations, such as the Philippines and Vietnam, were classified as 'restrained' in accepting Chinese funds, while higher-income nations with moderate development needs, such as Indonesia, Malaysia, and Thailand, approached ties with China 'the most opportunistically and politically'.
The study said the 'new-found agency' of many Southeast Asian countries to calibrate development ties with China might be undermined if Western aid cuts – such as President Donald Trump's decision to impose a 90-day freeze on foreign aid provided by the US across the board – translated to a drastic reduction of development financing available in the region.
Countries already reliant on Chinese development support will have even less room to explore diversifying their ties
Alexandre Dayant and Grace Stanhope, Lowy Institute's analysts
'Countries already reliant on Chinese development support will have even less room to explore diversifying their ties. Countries with restrained or opportunistic approaches to China will find it harder to maintain this precarious balancing act,' the study said.
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