Meeting

The U.S.-ASEAN Relationship: A Conversation With U.S. Ambassadors

Tuesday, April 23, 2024
Jaimi Joy/Reuters
Speakers

U.S. Ambassador to Malaysia

U.S. Ambassador to Vietnam

President and CEO, U.S.-ASEAN Business Council

U.S. Ambassador to Laos

Presider

Former Executive Vice President for News Standards and Practices, CNN; Former President and CEO, International House; CFR Member

Panelists discuss the strategic opportunities and challenges of the U.S.-ASEAN partnership in addressing pressing regional and global issues, including trade, maritime security, human rights, climate, and technology.

SIMS: Well, good morning, everyone. I’m Calvin Sims. And I was a fellow here at this distinguished institution for a year after I came back after being a correspondent for the New York Times. And so we’re very pleased to have you here. And we are also very pleased to have over 140 folks who are tuning in outside of this room. And we’re excited about today’s program.  

So to start things out, I’d like to talk a little bit quickly about the U.S.-ASEAN relationship. And we have a distinguished panel here of ambassadors, businesspeople, who will help us really understand and parcel out how things are going. So—there’s an echo somewhere. (Laughter.) But let’s see if we can do a little bit better than that. OK. OK. So I am very pleased to let everybody know today that in addition to the hundred members who are watching on Zoom, we have four of the most, I think, versatile and equipped to tell us about this relationship and where it’s going. So, to do that, I thought it would be a good thing to, firstly, announce the panel. (Laughter.) I keep hearing myself. (Laughter.) 

So we’re happy to have the U.S. ambassador to Malaysia, Edgar Kagan, the U.S. ambassador to Vietnam, who is Marc Knapper, the U.S. ambassador to Laos, who is Heather Roach Variava, and the president and CEO of U.S.-ASEAN Business Council, Ted Osius. (Laughter.) OK. We will just have to actually go with that. (Laughter.) So let’s first start out, I think, talking about this alliance, how it has evolved over a period of time, how important it is, and some of the challenges that this panel will talk about. So I’m going to let each of you introduce yourselves and start out by talking a little bit about this alliance and how it’s actually forging. 

KAGAN: So— 

SIMS: Please. 

KAGAN: So, look, I’m Edgar Kagan. I’m the U.S. ambassador to Malaysia. And it is a great pleasure to be here. And thank you all first coming, and those who are watching on Zoom, or whatever the equivalent is. A few things very quickly about ASEAN. I think, one is just the idea that if you look at the next thirty years, and you look at where global growth will come from, it is going to come from Southeast Asia and India. And Southeast Asia and India together will probably play the role that China has played in the last thirty years in terms of being the largest single drivers of global growth.  

For that—if you accept that, and I think the data is fairly clear—obviously projecting, you know, more than ten years into the future is always challenging. But if you look at the combination of where per capita incomes are now, if you look at the combination of population and scale, which is there are two billion people in India and Southeast Asia—660 million in Southeast Asia—these are impressive numbers. And it’s getting to the point where the per capita incomes and a scale the economies are such that it will start to drive global growth, particularly if you get into the out years.  

And so from a U.S. perspective, being engaged in Southeast Asia is critical for the United States. And being able to be effective in the region requires being engaged in Southeast Asia. In order to do that, we need a combination of strong bilateral relationships with countries in the region, and strong relationships with ASEAN. And about fifteen years ago I think there was a decision that was made within the U.S. government to recognize that if we wanted to be able to improve our bilateral relationships in Southeast Asia, we needed to be more engaged, and more effectively engaged, with ASEAN. And so that has been, I think, a key organizing principle. And it’s something that in recent years the U.S. government has doubled down on in terms of expanding the level of engagement, participating in more activities, but also creating more opportunities and engagements for us to be able to work closely with ASEAN countries.  

And I think that one of the things that also needs to be recognized is that ASEAN has changed significantly over the past twenty years. And it has gone from being very much a leader-driven organization—and it still is—but one where there’s an increasing number of other levels of engagement—at the ministerial level, sub-ministerial level. And these are having a real impact in how countries in the region organize themselves, setting standards, setting rules, trying to reduce barriers, which in turn is good for the United States and creates opportunity.  

So I think our organizing principle has been, we need to be engaged with ASEAN. We’ve stepped up significantly the level and efforts to try and do that. And I think as ambassadors in the ASEAN member states, what we realize is that there—in order for us to be effective, we need to also make sure that we have effective engagement with ASEAN, and vice versa. We cannot be effective in ASEAN if we don’t have strong bilateral relationships with the member states.  

So with that, let me just hand it over to my colleague Marc Knapper.  

KNAPPER: OK. Thank you, Edgar. Good morning, everybody. Thank you to the Council on Foreign Relations for hosting us this morning. Last time I was here was six years ago, when President Moon Jae-in of Korea visited. I was in the audience he was on stage. And so it’s nice that after six years I made the transition to the—(laughter)—to the stage.  

Just to piggyback on what Edgar said about the importance of having strong relations with ASEAN as an organization, leading to stronger relations with our individual bilateral partners, and vice versa, I think Vietnam is a perfect example. Vietnam was a latecomer to ASEAN. It joined in 1995, which is not a coincidence that that same year the United States and Vietnam normalized our relationship, you know, twenty years after the cessation of hostilities in 1975. And I think the view then was, in ’95, it was important as part of our efforts—part of Vietnam’s efforts to integrate with the world, to reestablish relations with the United States and others, that being a member of ASEAN was going to be key to Vietnam’s regional and eventually global integration.  

And since then, Vietnam has been a key member of ASEAN. With 100 million people it’s one of the largest members of ASEAN, I think, right after Indonesia. And it’s really proving to have a strong voice in the organization itself. As Edgar said, it’s a very disparate organization. Ten different countries. Ten different cultures. Ten different languages, for the most part. And so very often ASEAN, as a group, trying to find a single sort of approach to an issue can be tough, but it does really put a premium on the different levels of meetings that take place throughout the year—which Heather, our colleague, can talk about, as Laos is this year’s chair of ASEAN. 

But, you know, Vietnam has tried to play a positive role. It’s unique in that it is a country that borders the South China Sea, and so it has all the issues incumbent on dealing with the PRC’s unlawful and aggressive actions in that body of water. But at the same time, Vietnam has is a country that borders the Mekong River. And so with that, and all the issues incumbent on having to deal with sort of the environmental and transnational issues that come with having a river shared by five other countries. And so Vietnam is in a very unique position. It’s tried to play a strong leadership role. And it’s one certainly that we, the United States, have supported over the years. And maybe later on, if folks are interested, I can get into more specifics about the U.S.-Vietnam relationship. But over to Heather. 

VARIAVA: Thank you. Good morning, everyone. It’s wonderful to be here. I’m Heather Variava. I’m the U.S. ambassador to the Lao People’s Democratic Republic. It’s very exciting to be here this morning.  

It’s also very exciting and a huge honor to be our U.S. ambassador in Laos, and during a busy year. The leadership of each year in ASEAN rotates among the members. And so this year, Laos is the chair of the ASEAN year, which means a very busy year of meetings. There are more than 200 meetings that take place over the course of the year, the apex, of course, being the summit in the fall, as well as a series of ministerial meetings. But then there are meetings at a whole range of levels on a whole range of issues.  

And I think I would note that, speaking first a little bit about ASEAN, the ASEAN and the U.S. relationship with ASEAN is at the heart of our United States Indo-Pacific strategy. We are very excited that within the last year, our partnership with ASEAN has been raised to the highest level—a comprehensive strategic partnership—and we collaborate with ASEAN on a whole host of issues. Certainly, large geopolitical issues, South China Sea, Mekong River. The ASEANs, of course, are very focused on the situation in Burma. But there is a whole range of other collaboration that goes on that is perhaps less visible, but in some ways more impactful. Whether it’s on trade and building economic growth in the region, responding to disasters, health issues. So really a whole range of issues that the ten member states collaborate on. And the United States, as one of the dialogue partners of ASEAN, plays a key role. And we’re very happy to do that.  

In Laos, the United States, you know, sees Laos as a very important member of ASEAN. Their theme this year for their ASEAN chair year is connectivity and resilience, which sort of pulls in a couple threads that are very important to Laos. First, its role as the only landlocked member of ASEAN, being right in the heart of Southeast Asia. They are seeking to make themselves less landlocked, and more, what they call, land linked, serving as a transit point for the five nations that border Laos. They’re also—so connectivity. And not just in terms of hard infrastructure like roads and rail, but in digital as well.  

And then resilience. Laos has been particularly hard hit by the—some of the economic headwinds that have faced the world globally and, given their position and connections particularly with the PRC, facing some challenges economically. So and then coming out of the pandemic, the region is looking to build resilience to face the pandemic and other cross-border challenges that they want to work together on. I’ll stop there, but look forward to taking your questions and speaking more about both ASEAN and Laos. 

OSIUS: Thanks. So, thank you Calvin. And thanks to all of you. It’s great to see so many friends. I’m Ted Osius. Unlike my colleagues, I don’t speak for the U.S. government anymore. I was ambassador to Vietnam as my last job in government. Now I run the U.S.-ASEAN Business Council. We represent 170 companies that are active in Southeast Asia. Collectively they’re worth $7 trillion. So when we go in and advocate for American business, we’re advocating for a whole swath of American business in ASEAN. The council has been around for forty years. It’s built into the ASEAN charter.  

But what really has struck me in the last few years is how much interest there is. Ambassador Kagan mentioned the growth story. There’s also the story of nervousness about being too overexposed in China. A lot of companies have a China plus one or China plus three strategy. Really, just a business strategy of diversifying—diversifying supply chains, markets. And ASEAN is a natural place for a lot of those businesses. United States companies have invested more than anybody else in the ASEAN region. And U.S. companies have invested more in Southeast Asia than in China, India, Japan, Taiwan, Korea put together.  

And so there’s a tremendous amount of support for U.S. business within ASEAN. The doors are always open to us. Our members, I have to say, are more interested in the individual member states than they are in ASEAN as an organization. And it’s not equal. There’s more interest in Vietnam and Indonesia than there are in the other eight nations. There’s more interest in ICT, energy, and healthcare than in some of the other industries. It’s not evenly distributed. But there’s a tremendous amount of interest right now. Tremendous amount of companies that are looking for opportunities beyond China, beyond some of the other states in Indo-Pacific. So I’ll stop there. 

SIMS: So, to pick up on that thread, what’s made this harmony, you know, so nice to actually hear, when you have almost the Tower of Babel with people, you know, from different languages, different cultures? What’s made this work over time? 

OSIUS: Well, it’s funny, because people, you know, will sometimes say, well, this is a creaky organization. The countries are all so different. They have such different governing systems. Some are large, some are small. Indonesia is half the population. So world’s largest Muslim-majority nation. And it’s a democracy. And then you’ve got Brunei, a sultanate, at the other end. But what people maybe don’t understand very well is that it’s really about a web of relationships. People say, well, the ASEANs, they get together and they sing a song, and sometimes there are skits, and, you know, what is so serious about that? Well, there’s actually—it’s actually quite serious, because relationships are formed through the 200 meetings a year that are going to be taking place in Laos this year. Relationships are formed that when crises occur they know who to call.  

So when—you know, when there’s a border crisis between Thailand or Cambodia, a crisis at sea, the ASEAN leaders all know each other. They’ve all spent a lot of time together. There are—even in—in every city there’s an ASEAN group. So, you know, in Copenhagen, in Stockholm, in Washington, D.C., wherever there are ASEAN diplomats, they get together and they coordinate. So it’s actually—it’s something that works quite well, even though it’s inefficient. (Laughter.) 

SIMS: Want to pick up on that? 

VARIAVA: Well, certainly, it’s a forum for discussion and debate. And, you know, because they’re very disparate nations, but—and for other reasons—you know, they do want to do things together. They see themselves as a bloc. And it can become also a venue for, you know, working, you know, maybe on bilaterally there are difficult issues between them, but they can work together in the ASEAN context. So I think that—and, you know, as anybody who works in Asia knows, relationships are the basis on which you get a lot of work done. And that network and that—you know, that network of ASEAN nations is hugely, hugely important. 

KNAPPER: I’ll just say, you know, the U.S. approach to the region and to ASEAN, we talk often—and it’s actually enshrined in our Indo-Pacific strategy of the Biden-Harris administration—but we talk about ASEAN centrality, and the importance of ASEAN centrality. And basically, what that means is our approach to the region, first and foremost, will be ensuring that this organization is part of any solution to any problem affecting their part of the world. And so we take—we go to great pains to ensure that whenever we do talk about issues related to the region—whether it’s South China Sea, whether it’s Myanmar, you name it—always we’re very careful to make sure that we include ASEAN as a key part of whatever solution is out there. 

KAGAN: Yeah, just building on what Marc said, I think it’s worth keeping in mind that, you know, what ASEAN centrality means, to a large degree, that the one organization, the one thing that brings everyone in the Indo-Pacific together—all the major players in the Indo-Pacific, is the East Asia Summit. And that is—and this is part of why, I think, leaders in the region, countries in the region, remain committed to ASEAN. Because look, ASEAN has reached the stage of its development where people can privately grumble about it without it undermining the whole organization.  

But I think that the reason that they’re committed to it is that by being together, they put themselves at the center of the region. And the one body that brings all the major players of the region together is the East Asia Summit. The one thing that brings people together at the foreign minister level, and also at the defense minister level, are the ASEAN-driven summits. And so this, I think, is one of the things that countries in the region recognize—is that by staying together, by making ASEAN work, even though at times it’s hard, they make themselves far more effective at shaping the region around them than they would be if they were engaging separately. 

SIMS: Can we talk a little bit about some of the challenges, particularly with Myanmar and this military takeover, as well as some of the claims by China in the south. How do you all see this? Has this worked out? Is it still a menace waiting there? How have things sort of been turning out? 

KAGAN: I’ll take the first cut, but—I think that these are, obviously, incredibly complicated issues. And I think that for the countries in the region, how they balance—or, for ASEAN member states—how they balance their own individual interests with the interest in supporting ASEAN’s ability to work together collectively, is a real challenge. And you can see the response to Myanmar where, in many ways, ASEAN surprised many of the people in the region and observers by taking more action, at least in the first three months, than I think many had expected, in terms of putting out this five-point consensus that had, you know, conditions and expectations for the junta. And I mean, the truth is, it hasn’t worked.  

But the fact that ASEAN was able to come to a position that did have expectations for the junta, rather than sort of turn a blind eye to what happened, I think was a very significant sign of ASEAN’s development. Because if you go back to how ASEAN dealt with Burma in the ’90s and early 2000s, there was much less of a willingness to do that. I think it reflected some real changes, and also reflected the fact that a number of member states—Thailand is extraordinarily exposed to what happens in Burma. But Malaysia and Indonesia, both are exposed because of refugees coming to those countries. So there was a critical mass of countries that had an interest in trying to find ways to address, and hopefully manage, the crisis. 

I think China and South China Sea, it’s much more complicated. And there is a division between the claimant states and the non-claimant states. And I think that there is a recognition that there—it is in ASEAN’s interest, but also the individual member states’ interests, to work together as much as possible. And I think that for the U.S., there has been a balance between trying to work with individual member states and, at the same time, trying to make sure that we’re engaging effective with ASEAN. And I think the jury’s still out on whether or not that’s right. But I do think that there is very much an interest in the region in seeing strong U.S. engagement, and a strong U.S. presence in the region for economic reasons, but also for security reasons. And that is driven in part by the recognition that they are all better served by having more choices. 

KNAPPER: And I would just add on the South China Sea, as Edgar said, ASEAN as an organization is divided. Five of the ten members of ASEAN are claiming states in the South China Sea—so Vietnam, Philippines, Malaysia, Indonesia, and Brunei. And, of course, you’ve got China. And so it’s—I think one of the goals of our administration has been to try and encourage claimant states to resolve amongst themselves some of their, you know, maritime issues. I think we saw recently Vietnam and I think it was Malaysia, perhaps, that were able to delineate some of their claims. Certainly, we’re hoping that Philippines and Vietnam could do the same. But sort of within ASEAN itself, individual countries settling some of their competing interests, I think. would help to ensure that, you know, all countries are able to address the bigger issues involving, again, you know, one particular country trying to coerce and bully others in that part of the world. 

VARIAVA: I think, you know, again, as Edgar said, ASEAN, you know, is a way to address issues in a collective sense, in addition to the bilateral way. We approach the member states on key issues of interest to the United States. Perhaps not as much a flashpoint, but certainly a hugely important issue for about half of the ASEAN member states is the Mekong River, as Marc alluded to. So working within regional mechanisms to approach the use of the river, up-river damming, and then the activities of the member states on the river itself, in terms of how do you preserve this important watershed both from an economic as well as an environmental way. So, I think, you know, these mechanisms provide opportunities, albeit slow ones at times, to tackling some of these cross-border issues. 

OSIUS: So when I served in Thailand many years ago, arrived after 9/11. And at a big public forum someone said, well, what would the world be like if we hadn’t had the United States preserving the peace for all of these years? Well, I look at Southeast Asia and think, well, what would it be like if there weren’t an organization that created the centripetal forces that allowed countries to deal with a challenge such as that in Myanmar, the challenges in South China Sea? It would be much harder to resolve these—any of the issues, without those centripetal forces. 

SIMS: And before we go to the audience, I’m curious to know your thoughts on the impact of this for individual families from these countries. Have we seen the benefit of that? 

VARIAVA: Well, I would note that, you know, for Laos, as one of the smallest member states both in terms of its population size as well as its economy, et cetera, being a part of ASEAN, you know, it’s sort of—it’s like the rising tide lifting all boats. I think that Laos, while it faces significant challenges, would be in a worse shape, frankly, if they weren’t an ASEAN member. It helps link them together with its neighbors and helps them gain attention to you and support for priorities that are important to that that country. 

KNAPPER: I would add—I think, just in terms of interregional trade, for example, the reduced tariffs on goods moving across borders, I think is has benefited all these countries, and also American companies. So in one instance, we’ve got an American auto company will manufacture parts in Thailand, export those to Vietnam, where they’ll be assembled and sold in Vietnam as an American vehicle, but without the tariffs that would go with, say, importing that same vehicle from Detroit or Canada. And so I think it benefits not just the countries involved, but also, in this case, multinational corporations from the United States. 

KAGAN: I think that’s right. And I think that there’s a number of—(inaudible). One is there’s obviously a huge amount of trade with ASEAN and Southeast Asian countries. And that’s certain to grow in coming years as they grow. And that trade creates prosperity in the United States. Even there—you know, there are things where there are imported components that come in and are assembled in the United States. There are—one simple thing that I saw in 2021 when I was working in Washington was the COVID closures in Malaysia of plants that made or assembled semiconductors led to furloughs at six GM plants in the United States. And that linkage, I think, was something that, you know, people sort of knew intellectually. But seeing the power and the impact of, you know, essentially COVID movement restrictions and closure of plants in one country suddenly leading to people being furloughed in the United States, that was a big deal.  

And I think that that ripples through the economy. And there’s a lot of other areas like that. And I think you can see the growth of U.S. investment, Vietnam, growth of U.S. investment in Malaysia in recent years, those are things that reflect companies moving production out of China, or even if they’re maintaining production in China going to China plus one or China plus three model, as Ted said. And those are things that create resilience for Americans. I mean, having distributed supply chains, having multiple supply chains, helps protect us against the kind of disruptions that we saw during COVID.  

But I think that also the export story. As ASEAN countries become more prosperous, they are consuming more. And there are American companies and American goods that are going into that, I think that also creates opportunities. For anyone who’s interested, and I know I’m not supposed to mention a rival institution, but the East-West Center has a very good program of things that are called—you know, some—insert-name-of-country matters for America. And so there’s an ASEAN Matters for America. And I don’t remember what it is, but it’s actually quite impressive how many jobs in the U.S. are tied to exports to ASEAN countries. So I’d recommend if anyone’s interested to look it up. 

OSIUS: And U.S.-ASEAN Business Council worked with the East-West Center on that publication, which we put out every year. Just want a quick story as to illustrate this—kind of the trade dilemma, as well as the trade opportunity. Last month, Secretary of Commerce Gina Raimondo took a presidential trade and investment mission to Manila. And Admiral Aquilino, the head of INDOPACOM accompanied her. And, you know, some of the businesses—there were twenty-two of us on the delegation. Some of the businesses said, well, you know, why would the admiral come with the secretary? And she was very cynical about it. She said, you know, economic policy is national security. National security is also economic policy. These are two sides of the same coin.  

In the Philippines, you’ve all seen CNN, water cannons blasting Filipino sailors in their—in their resupply boats to Second Thomas Shoal. Well, it’s obvious that we are supporting our ally on—our ally of the Philippines, one of our oldest allies, on the military side. But what the Philippines really needs is for us to engage economically. And what Secretary Raimondo did when she brought these companies together, she announced a billion dollars’ worth of deals in the Philippines. There are a whole lot of other follow-on deals that are—that are going to happen as a result of this mission. It’s because for the United States also economic security and national security go hand in hand. 

SIMS: So now we’re going to give the audience a chance, both here at the Council and then all those who are in the virtual. So let’s start out here and have you ask the first question here. 

Q: Hi. Nelson Cunningham, with no current affiliation. (Laughter.) 

In January— 

OSIUS: Senate willing. 

Q: Yeah, Senate willing. 

In January, I traveled with my daughter across Southeast Asia. We were in Singapore, Cambodia, Vietnam, Hong Kong. Next trip Luang Prabang and Penang, but not on this trip. And on those countries, we saw—I saw very different degrees of intentionality about Chinese economic engagement with those countries. And I wonder if you could each talk about the intentionality of Chinese economic engagement in the countries that—where you are representing us. And then also, how are we doing as a counterweight to that? And, Ted, you know Singapore so well, you might—you might cover Singapore in your remarks. Thank you. 

OSIUS: I’ll go directly to it. Almost every company that we work with has a presence in China, and also in ASEAN. And so the approach that we’ve always taken is, well, let’s look at the opportunities of ASEAN, and let’s not have it be all about China. And actually, that’s kind of the attitude that I find a lot of the ASEAN nations take. Hey, you know, we’re intrinsically important. It’s 667 million people, the fourth largest economy in the world collectively. Will be the—you know, it’s moving—it’s moving up, not down. And so the attitude is, look at the opportunities that are right here and don’t make it always about what’s going on between the United States and China.  

And I think businesses in Singapore, in Vietnam, and throughout the ASEAN nations are saying, well, you know, here—yeah, we provide an alternative if you’re looking for—you’re looking for—to diversify your approach to the region. And there are ways that we can be more—we can provide more incentives, we can be more open, we can be more willing to change. My counterpart at the U.S.-China Business Council has a harder time, because you can’t get a meeting in Beijing if you don’t show up with the CEO. I can come with senior people, senior executives, all the doors are open. We get to see all the leaders. They know that there’s a battle on for investment as well. You want to—you want to show an openness to American companies. And ASEAN countries are very, very good at that. It’s a partial answer to your question, but I hope it’s helpful. 

VARIAVA: In the case of Laos, which is quite different—in a quite different economic situation, particularly compared to, say, Vietnam and Malaysia—very small country, economy. Shares a northern border with the PRC. Heavily indebted to the PRC as a result of significant Belt and Road Initiative investments—rail and particularly in energy and power. So, however, Laos is an independent nation that it’s fought wars over its long history to remain so. So how do we support Loas and its economy—to support Laos to be a stable, prosperous, active member of ASEAN?  

And I think for the United States, our comparative advantage is in building Lao capacity, the capacity of the people of Laos, working with the government to help put in place economic structures that encourage investment, not just from China but from other countries. We are investing a lot in health and education, again, all building the resilience and the capabilities of the people of Laos to chart their own course. When it comes to business and investment, currently, you know, the best way to consider Laos is vis-à-vis its neighbors, Thailand and Vietnam. If you’re investing in those countries or doing business with those countries, there may be a nexus to doing more with Laos. We have a small but mighty Lao American diaspora that is playing an increasing role. And certainly, I can talk later if desired about legacy issues from the Indochina War and our work in that area as well. 

KNAPPER: Well, I would just say, real quick, on Vietnam, I mean, of course, there’s no doubt the importance of China to Vietnam’s economic wellbeing. I mean, like every other country in the region, China is Vietnam’s number-one trading partner, $180 billion a year. That said, the U.S. is Vietnam’s number-two trading partner. We’re at about $124 billion a year and growing. And, you know, when you look at Vietnam’s aspirations for itself, whether it’s to be a clean—green economy, you know, in the next several decades, whether it’s to be a high-income economy, whether it’s to be a high tech, you know, innovation-driven economy, all of these aspirations are tied to their relationship with the United States, are tied to investment from the United States, trade with the United States.  

They look to the U.S. and U.S. firms not—you know, for high-tech innovations, for human resources, best practices, for best practices in terms of just doing business, you know, accounting, you know, all the sort of back office things that we excel at. And so I think the intentionality in the case of Vietnam is to ensure that they don’t fall into traps set by certain loans and other projects from the PRC. They have been very intentional about not inviting a lot of Chinese investment into big infrastructure projects. And their desire, I think, is to work closely with the U.S. and our likeminded friends and partners—like South Korea, like Japan, like the EU, India, Australia. So it’s quite a different story, I think, in Vietnam. 

KAGAN: I’ll just say very quickly, from Malaysia, that, you know, I think they see this as an opportunity. You know, what they—I think Malaysia wants to avoid being put in a position of taking sides, but they also want to reap as many benefits as possible from the sense of competition both between the U.S. and China, but more broadly with other countries that Marc just mentioned—Japan, Korea, Australia, of the EU, and so—the U.K. And so I think collectively they see this as an opportunity. And where they sit in terms of supply chains and the ability to add value, they see this as an opportunity also to significantly jumpstart their economy by attracting investment.  

Now, the reality is, the Chinese do things which others aren’t able to do as effectively, particularly infrastructure. And that continues to be a big gap. And I think across the region, certainly in Malaysia, there is a desire for infrastructure. And, you know, I think that there is also an awareness of the risks that come with the financing, and the importance of getting good projects and good quality investments. And I think that that is where the U.S. has an advantage. We don’t compete in the infrastructure, but there’s a deep appreciation for the quality of U.S. investment, the jobs that it creates, the willingness of U.S. companies to invest in their—in their workforce.  

The number of companies across Malaysia that have been started by people who worked for U.S. companies or worked in the United States, I think, is extraordinarily impressive. And there’s a recognition also that that leads to tangible benefits. The average salary that American companies pay in Malaysia is twice as much as the average Malaysian salary. And that’s not a small thing. There’s a recognition that reflects investment. It reflects a desire to develop the workforce. And then that’s one of the positives that comes with stronger economic engagement with the United States. 

SIMS: Hands? 

Q: Anne Nelson, Columbia University. 

The United States has been increasingly involved in remediation of Agent Orange and other defoliants and unexploded ordnance in both Vietnam and Laos. Could you please give us an update on those efforts and what the possible next steps might be? Thank you. 

KNAPPER: I would be delighted to. This is actually a real bright spot in the relationship between the U.S. and Vietnam. It’s foundational to our two countries’ ties. Our efforts to address what we call war legacy issues predates even normalization, starting with the effort to search for—search for and account for missing American service members, beginning in the late ’80s, but then moving through, as you said, efforts to clean up unexploded ordnance. You know, we dropped more bombs on a single province in Vietnam than we did all of Germany in World War II.  

And many of those cluster munitions did not explode. They’re still very dangerous. They still injure people. And so part of our effort has been to clean up these munitions, in concert with some NGOs from Norway, and Korea, and elsewhere. The U.S. government, your tax dollars, have gone to education, ensuring that kids don’t play with these things, that farmers don’t try to sell them for scrap metal. And it’s been successful. There hasn’t been a death from an explosion now in some time in some of these provinces. So that’s a success story.  

Cleaning up Agent Orange, dioxin, sites. And in fact, Ted Osius presided over the closing ceremony for the cleanup effort at Da Nang now-Airport formally Danang Airbase, back in 2018, ’19? 

OSIUS: Actually, 2017 was we cleaned the first batch. 

KNAPPER: So a big deal. Again, hundreds of millions of dollars spent to do this, to make the land usable again for—either for cultivation or development. And a similar effort now going on in a different airbase called Bien Hoa, which at one point was the most busy—was the busiest airfield in the world at the height of the war. And now, basically, we—the U.S. government, again, thanks to your tax dollars and to our elected representatives who fund these projects, hundreds of millions of dollars go into clean up this site. And hopefully in about six years it will be completed.  

And then finally, money that goes to assistance for people with disabilities, people either injured by exploding ordnance or injured by the effects of the dioxin, which are pretty horrific. And so it’s really a bright spot. The Vietnamese appreciate very much what we’re doing. It really did set us on a course towards reconciliation, towards friendships, toward building confidence in each other, to create the Vietnam-U.S. relationship that we enjoy today.  

VARIAVA: Very similarly, in Laos the war legacy issues are at the core of our relationship. There continues to be an effort to find missing service members from those war years. Laos experienced a bombing run every eight minutes for nine years, 270 million clusters, munitions dropped over the course of that period. Eighty million were left unexploded. We have undertaken a huge effort to map and then begin to clear this. This is one of the top goals of the of the Loa government is removing unexploded ordnance. It’s a barrier to national development. They have their own sustainable development goal for this reason. And the United States is the largest donor to that effort, having provided over $300 million since the ’90s to address the issue of unexploded ordnance, which permeates throughout the country. 

We still see—despite—we do have efforts on education, as Marc mentioned. I think we’re up to twenty people who have been injured, and a couple people who have died as a result of unexploded ordnance this year alone. So it remains a very present issue. And it’s a very important one, both to the people of Laos and to the government in terms of their economic development. And the United States takes very seriously its responsibility to support Laos in this effort.  

We have similarly a very large program aimed at supporting people with disabilities. And it’s people—anybody who suffers from disabilities—or, I shouldn’t say suffers from—who are differently abled, you know, supporting those—the efforts to help those people become, you know, accepted and fully functioning members of society. We actually had our special envoy for disability rights in Laos just the other month talking about how to further support folks with different abilities within Laos, and also within ASEAN more broadly.  

Q: Missie Rennie. I just wanted to ask—oh, sorry. Missie Rennie.  

I just wanted to ask a question about sort of the Philippines and the change of leadership there and tilting much more toward the United States in allowing military bases and operations to be there. How does that fit into the rest of the ASEAN sort of feeling about the area and the relationship with China? Because this has not really been there since we withdrew from the bases and the ’70s.  

VARIAVA: So I—before serving as ambassador to the Lao People’s Democratic Republic, I was the chargé d'affaires and deputy chief of mission in Manila for the last two years. You know, I think, as was mentioned, one of the oldest treaty allies that we have in Asia is the Philippines. And I think this is a good example of how we have both—you know, we work on a bilateral level with the Philippines, as well as with the Philippines in the ASEAN context.  

We have always had a long—a strong security relationship with the Philippines. Obviously, in the early ’90s, we left the bases. But that doesn’t mean we haven’t continued to have this very strong relationship. And I think that, you know, Edgar, when at the NSC, and those of us at the Embassy in Manila, very focused on building up that important alliance, vis-à-vis South China Sea and, you know, there—and recognizing that both our alliance is an ironclad one, but also that, you know, upholding and recognizing that the U.N. Commission on Law of the Sea, recognizing Philippine’s rights in the South China Sea, and as well as other claimant states. You know, it’s a very important part of our relationship. I don’t know if others want to comment on that. 

OSIUS: Just one quick story. There’s a saying in ASEAN that when the elephants fight, the grass gets trampled. Obviously, the smaller states gets trampled. When the elephants make love, the grass gets trampled. So there’s kind of—there’s not too much excitement when the United States and China are too buddy-buddy. There’s an understanding there’s always going to be competition. But the ASEANs don’t want it to get out of hand. I’ve just come back from the Philippines. The relationship is remarkably transformed, in a remarkably short period of time. I can—I’m certain that Vietnam is happy about the fact that, on South China Sea issues, that we’re back in line with the Philippines. 

SIMS: I think we have a question from the digital space. 

OPERATOR: We’ll take our next question from Moushumi Khan. 

Q: Hi. This is Moushumi Khan, joining you from Manila, Philippines, where I have the privilege of representing the U.S. as the alternative executive director at the Asian Development Bank. Hi, Heather. Hi, Ted. Nice to have seen you recently. (Laughter.) 

I was listening very carefully and very—with great interest to this great discussion, particularly about infrastructure development. As you know, we, at the USED’s office and ADB, we’re very committed to quality outcomes and value for money. So very interested to hear this. My question is actually regarding the interest. What would you say to those in the region who say, well, you know, U.S. interest is very fickle, so how can we count on your renewed interest? I think you may know what I might mean. But anyway, thank you for this great panel. Really enjoyed it. 

KAGAN: I think a couple of things. And it’s a good question. I think one is that if you look over the span of the last seventy years, there’s actually been very consistent levels of U.S. interests in the region. I don’t want to say that they haven’t fluctuated, because they certainly have. But the overall trend driven by U.S. engagement in the region, the relationships, the alliances, the partnerships, and also the investment in the trade, has actually been quite consistent. And I think that the fact that the region matters to the U.S. is increasingly understood in Washington and in the region.  

And so I think that, you know, will there be changes in terms of style, in terms of types of engagement over the next thirty years? Absolutely. You know, that’s a reflection of the fact that we’re going to see changes, and there’ll be different styles in whatever administrations we have over the next thirty years. But the idea that Southeast Asia is going to be critical for the future of the United States, I don’t think there’s going to be serious questioning of that. And I think that that will drive a level of engagement in Washington that’s going to grow over the coming thirty years, because it will be necessary.  

And that’s because of a function of economics. It’s a function of the global growth story. But also, it’s a function of ASEAN centrality, of the fact that if you look around the world where there is competition with the United States and China, the United States and our allies and partners in many places, there’s probably no area that is more contested in Southeast Asia. And I think that will drive a high level of interest from any future U.S. administration over the next thirty years. 

SIMS: Please. 

Q: Hi there. Thank you. I’m Ella Gudwin. I’m the CEO of VisionSpring. I’m also a proud SAIS Southeast Asia alum.  

So I have a question and an offer. Question is, we’ve talked about China. If we could look to India, India’s rise, how might ASEAN and the nations be looking to India to draft off of that, and benefit from India’s economic rise? My offer is a competitiveness improvement. Looking into the supply chain, one in three workers in the factories in Vietnam, it’s true in Bangladesh also true in Indonesia, cannot see clearly. They have uncorrected, blurry vision. So a third of the workforce is trying to maintain quality and productivity with blurry vision. We can offer support on that to fix that. So going to China—sorry—going from China to India. Thank you. 

KAGAN: So I’ll just say, I think Marc can talk about that, because the India-Vietnam relationship is very close. But I think that India’s rise is understood, but it’s still not fully appreciated. And, you know, people see it’s going to happen. I think that the key is going to be that India is going to need to remain significantly engaged. And I think you can see that India is doing it. I served in India for four years, both as the consul general in Mumbai and the deputy chief of mission in Delhi and worked a lot in my previous capacity at the NSC on these issues. And I think that that is something that is still developing in terms of how countries in the region see India. I think it’s going to be driven by, you know, the fact that countries in Southeast Asia, particularly Singapore but also Malaysia, are investing in India, and the Indians are investing there. 

KNAPPER: Yeah, I would just say a primary beneficiary of Prime Minister Modi of India’s Look East, Act East Policy has been Vietnam. In ways big and small you’re seeing increasing Indian investment in Vietnam. The security relationship between India and Vietnam is quiet but growing. We have—virtually it seems like every month there’s an Indian warship that pulls into a Vietnamese port, just for training or other exchanges. Vietnam and India share a heavy reliance on Russian defense equipment. And so both of them right now are dealing with the effects of increasingly tenuous supply chains from Russia for spare parts, ammunition. And so they’re working together, along with others around the world, to try and find secure spare parts and ammo, not from Russia, but to keep their equipment running. And so I think this is going to be a big story going forward, India and Vietnam. And thank you for that offer. Would love to get your— 

OSIUS: Yeah. (Laughter.) Follow up on that offer. Thank you. 

VARIAVA: You see India—I mean, you see in India in varying degrees all over the region. And in fact, India has been there for hundreds if not thousands of years, because much of the culture of parts of Southeast Asia, you know, can be traced back to India. So you see them in a whole range of countries in various ways. So there’s no question. 

KAGAN: And if I could just jump in with one stat for you that got a huge amount of interest in Malaysia, which is that about two months ago the market cap of the Tata Group companies passed the GDP of Pakistan. And that—I think that resonance—and having a statistic like that really sort of drove home how India is growing, and how that’s likely to affect the region. 

SIMS: So we’re going to have our last question from the digital space, please.  

OPERATOR: We’ll take our next question from Paul Heer. 

Q: Yes. My name is Paul Heer. I’m with the Chicago Council on Global Affairs.  

As a follow up to an earlier question, and I wonder if the panelists could just address the extent to which ASEAN is unified on how to deal with China, and perhaps more importantly how unified they are on the U.S. approach to dealing with China. Thank you. 

OSIUS: Since I don’t work for the U.S. government— 

KNAPPER: Please, by all means, yeah. (Laughter.) 

OSIUS: So this is just me speaking. You can distance yourselves. There is a spectrum there. I would put sort of the Philippines and Vietnam at one end of that spectrum, and Cambodia, Laos, Myanmar at the other end of that spectrum, and some of the other countries in the middle. So Indonesia is an interesting case. And since no one’s representing Indonesia, I’ll fill in. Indonesia, I think, it is opportunistic in its relations with both the United States and with China. Where is that investment going to come from? Well, right now more investment is coming from China than from the United States. Part of what we try to do is do what we can to right that balance, and make sure that we’re bringing to American companies the opportunity to show up, especially when it comes to infrastructure.  

And our companies don’t—haven’t always—they very often look at ASEAN as a very complicated place. You know, all these different languages and all these different governance systems. And so we try to do what we can to simplify that and say, if we’re going to compete we ought to do it effectively. We actually—when we—when we show up and we do compete, we do very, very well. And speaking very broadly, it actually doesn’t really matter which end of the spectrum it is, there’s a huge desire to bring in American companies, American investors into the ASEAN region. Whether you’re at the Philippines end or at the Laos, Cambodia end. 

SIMS: And who wants the last question? Thanks. 

Q: Thank you. I’m Alexandra Starr with International Crisis Group.  

My question actually has to do with the U.S. relationship with Thailand, and in particular the military relationship and its efforts in terms of deterrence when it comes to China. 

KAGAN: That feels like— 

KNAPPER: Yeah, that’s another—that’s another one for you, Ted, I think. (Laughter.) 

KAGAN: I can—I can—if you let him go, I’ll add something. (Laughter.) 

OSIUS: So we’ve gone through a lot of gyrations with Thailand. Actually, that alliance is 190 years old. And in—at least in my view, we missed some opportunities when we decided to really beat up the Thais about democracy. That the—if you—if you—I think there’s an old saying, when the Chinese show up, they build a bridge. When the United States shows up, we deliver a lecture. That tends not to be that effective if we want to influence. If we want to influence, we need to engage. I actually think that American engagement in Thailand has helped move the Thais more in the direction of democracy. 

It’s messy. They have a system that’s very different from ours. The guy who got the most votes—maybe it’s not so different from us—(laughter)—because the guy who gets the most votes doesn’t always get to be the leader, even in our—in our perfect democracy. So in Thailand, it is a constitutional democracy. Srettha, who is now prime minister, his party didn’t get the most votes. But the party—the Move Forward Party was seen as too radical to assume leadership at this this time. That’s not made the relationship an easy one. I’ll tell you, American businesses keep engaging in Thailand and continue to see opportunities. And I think that provides a lot of ballast in the relationship. That’s the unofficial view. (Laughs.) 

KAGAN: Yeah, I would just—I mean, separate from endorsing or not endorsing what Ted said—(laughter)—I would just say that Thailand is an ally. And I think that there was a recognition that this is an alliance that we and they both needed to invest more in. I think that also the coup in Burma and the developments in Burma have actually raised real concerns about the spillover effects in Thailand. And that’s actually offered us an opportunity to work together on, you know, some of the things having to do with dealing with refugees that are very important.  

But I think more broadly the military relationships have been extremely valuable. They’ve offered channels at times when other parts of the relationship were more, you know, sclerotic. They’ve offered opportunities to work together in areas that actually matter to both countries. And I think that the broader story is one where you can see that the new Thai government, and the elections were little under a year ago. It took a little while to form a government. But in nine months there has been a remarkable amount of engagement. And I think it reflects the fact that from a U.S. standpoint we see Thailand as an incredibly important partner and an ally in an area that really matters to us. And I think the Thai see benefit in making sure that they retain as many choices as possible.  

And I will just leave you with the idea that, you know, I think something that’s critical in terms of how we engage with Southeast Asia is that they’re ten very different countries. There’s no one-size-fits-all model. There’s a temptation from a Washington perspective to engage that way, but I think that the key thing is that in each country we have a different mix of things that are attractive and interesting to them. They are things that they want in almost every country that we can’t do. Their things that they want that we can do. And finding how we balance those is a challenge, 

But I think the single most important thing is that no country in the region really wants to put in the position of making a clear choice between the United States and China. And that’s true in Thailand. But it’s also true in Singapore. It’s true in the Philippines. What they do want, though, are choices. And that the challenge for the United States is maintaining an engagement that allows us to maximize the advantages that we bring to the table in order to give countries there as many choices as possible in terms of how they protect their sovereignty, how they grow their economies, how they invest their futures, and, wherever possible, that we’re working together in ways that strengthen and advance our own interests.  

And I think that, you know, military to military relations in some countries are critical aspects of what we do. In other countries, it’s more driven by investment. In other countries, it’s more political. But in each of these, there is a mix. And there’s no country where—other than Myanmar—where we’re not doing military-to-military engagement. There is no country where there isn’t—where U.S. investment and business engagement isn’t important. And there is no country where political engagement isn’t important to them and valuable for us. So I think that the challenge for policymakers is going to be—and I think this is where, you know, it is important to have people like you pushing policymakers—is the importance of maximizing our advantages by looking at how we get the right mix in every country. 

SIMS: OK. And on that note, thank you all for— 

VARIAVA: Was a great note to end on. (Laughs.) 

SIMS: Yeah. Very good. 

(END) 

Top Stories on CFR

Kenya

During Kenya’s state visit, the United States should work toward building a more resilient model of U.S.-Africa partnerships.

 

Iran

Ebrahim Raisi was more loyal to hard-line Supreme Leader Ali Khamenei than previous presidents, and whoever succeeds him is likely to be just as conservative.