Regional Security: China’s Influence in Southeast Asia

Andrew Erskine, Isabelle Buchanan, Sharon Low, Simren Sharma, Steven Hu & Stuti Roy

With China’s seemingly unstoppable rise in power, NATO can’t go about its affairs without communicating with, or at least considering how its policy decisions will affect its relationship with the latter and Southeast Asia. China became a priority on NATO’s agenda in 2019 following then-US President Donald Trump’s emphasis on China over Russia as its principal threat during his campaign. However, this was nowhere near the first time that China has been prevalent on NATO’s agenda.[191]

Following the establishment of the Alliance in April 1949, China was in the midst of a civil war that saw the Chinese Communist Party (CCP) emerge victorious—furthering the red wave in the East with an additional communist power.[192] Although the United States was prepared to back the Nationalist regime of Chiang-Kai Shek and protect Taiwan, the Alliance’s European members did not support this tactical position.[193] Today the US continues to closely monitor China’s presence within the South China Sea and maintains a strategic ambiguity regarding the protection of Taiwan. Although Sino-Taiwan relations are a major point of discussion for security and defence circles, NATO should be equally concerned about China’s growing investments throughout the Alliance’s Southern, Eastern and Northern flanks—Africa, Eastern Europe and the Arctic.[194]

Another reason China remains divided among NATO allies was due to the growing Sino-Soviet partnership during the Cold War. Despite China and the Soviet Union fighting a short border conflict in 1969, the two communist state actors remained cordial in their diplomatic and military association.[195] During the post-Cold War period, Russia’s relationship with China grew stronger with both actors signing and reaffirming a treaty of friendship. This treaty was showcased during the 2014 Ukraine Crisis that witnessed China supporting Russia’s legitimate security concerns—furthering their mutual expansionist attitudes towards their geopolitical peripheries.

Although NATO is a transatlantic organization, the Alliance has key regional partnerships with Japan, South Korea, Australia, and New Zealand—with two sharing a border and two having close economic relationships with China. What is more, NATO’s vested interest in China has been furthered by its expanding influence in Southeast Asia. If NATO aspires to effectively develop an out-of-area strategy for Southeast Asia and China, its leaders, commanders, and bureaucrats must acknowledge China’s political, economic, and ideological challenges to the Alliance and its members.

For strategic recommendations to emerge, NATO must evaluate the principal forms of engagement that govern and structure the international system of states. As such, this report will consider Chinese influence and authority through institutions, power, and technology—focusing mainly on cyber security posed against NATO members—and deduce strategic courses of actions NATO can implement to enlarge their strategic oversight over regional security issues in Southeast Asia and the growing revelation of China’s rise to power, along with helping drive NATO’s security tilt towards the region. Lastly, the recommendations will showcase the indispensable nature of the Alliance in upholding their shared mandate for the collective security of the transatlantic community and as a pillar of the rules-based international order.

I. Methodology

The report is structured around a trilateral approach in its analytical research to develop a series of strategic initiatives NATO can undertake in upholding its mandate of collective security of the transatlantic community and a pillar of support for the rules-based international order.

The first approach consisted of a historical methodology that established the basis for research into Southeast Asia’s past relationships with regional states, European powers, and the United States, along with the centuries of shared warfare, regional treaty agreements, alliances, pacts, and responses to globalization, and international crises. The second approach consisted of a Sino-Asian perspective—formerly known as Third World—that established a fundamentally and regionally representative analysis of how China & Southeast Asian state actors observe international relations, agreements, and treaties, along with their preferred perspectives on international rules, values, and norms. Lastly, a structuralist approach studied the international environment of the emerging international system of states—its order type, polarity, and hegemony—that informs the rules, norms and values of states, institutions, and geo-security concepts within a regional and global context.

To build off the trilateral methodology and avoid the shortcomings of a broad and, at times, the overwhelming topic of regional security in Southeast Asia, the report investigated three areas of Engagement—Power, Institutions and Technology.

II. Analysis

By presenting NATO with three areas of engagement, the analysis showcases the need for a better understanding of the mechanisms that operate and authorize state and non-state actors to function in a system of states. As the geopolitical environment shifts towards multipolarity, NATO must reassert itself as a principle and prominent power that can use engagement strategies to remain relevant among its members, the democratic character of the transatlantic region, and the Alliance’s role in shaping and perpetuating a rules-based order.

By analyzing key diplomatic institutions, NATO can fluently undergo a strategic tilt toward Southeast Asia as the global and regional institutions at work illustrate how both China and NATO have diplomatically interacted in the past, and where future dialogues can maneuver their relationship to serve their geo-security and geo-economic interests, along with their shared responsibility for global peace, prosperity, and stability. It is undeniable that diplomatic institutions play a central role in managing regional and global power political and diplomatic tensions. Thus if institutionalism can be used to fuller effect, there is a likelihood that collaborative relationships between NATO and China can exist, rather than the present adversarial dynamics of the current system.[196]

By analyzing key power politics of Sino-NATO dynamics, a contemporary and pragmatic strategy can be explored that acknowledges the collective security and defence mandate of the Alliance, along with updating NATO’s relevance in Southeast Asia through coherent military, diplomatic, and political tactics. Moreover, by emphasizing China’s influence on Southeast Asia, a more in-depth and niche interpretation of the latter’s foreign policy goals can arrive that positions the Alliance and its members in a more advantageous strategic position to uphold and strengthen the rules-based international order.

By analyzing salient aspects of technological security related to Chinese-associated risks, a higher level of strategic action from NATO can emerge to strengthen its engagement and responsibilities to its partners in Southeast Asia will bolster the technological resiliency of the region’s democratic states. By assessing technological threats associated with emerging disruptive technologies (EDT), along with their misuse in business, science, and politics, NATO can arrive at a more complex understanding of how technological and hybrid warfare has amplified China’s power, influence, and authority in Southeast Asia and globally. In light of the CCP’s dominance in exporting and controlling its technological State-Owned-Enterprises, contemporary norms, values, and rules over technological governance and utilization, China continues to blur the line between civil dynamics and state grand strategy.

III. Engaging Institutions: Sites for Diplomatic Engagement

To analyze and assess the relationship between NATO member states and China in terms of engagement with international institutions, the foreground of “security diplomacy” —which focuses primarily on institutional actions—must move beyond a realist, or purely militaristic understanding of defence by taking into consideration universally agreed-upon principles.[197]

At the level of analyzing institutions, security diplomacy means a combination of “defence, rule-of-law, human rights, and humanitarian crisis response initiatives that are packaged to meet the specific needs of its partners.”[198] Literature on security diplomacy also acknowledges the importance of listening, especially in terms of avoiding misbranding between nation-states interacting through international institutions on aspects ranging from identity to values and commitments.

a) UNSC: Warfare and Security

China’s role in the United Nations Security Council (UNSC) has shifted over the years but it has maintained its adherence to the principle of non-intervention. The Security Council’s collective move towards Responsibility to Protect troubles China in that it undermines state sovereignty and promotes great power imbalances.[199] When it comes to international security, both China and Russia hold this position mimicking a Cold War bipolarity in attitudes.[200] However, there have been instances of collective intervention such as in the case of Syria in 2014. More recently, tensions regarding interventions resurfaced with relation to urging a ceasefire in the Israel-Palestine conflict, which the United States vetoed.[201] China is interested in reforming the UNSC to increase the representation of developing countries in terms of decision-making and veto power. This includes and is in the interests of China’s regional neighbours.[202]

b) WHO: Health

Global health and security are closely intertwined. Robust international cooperation becomes crucial given the reality that pandemics, such as COVID-19, do not adhere to international conventions of sovereignty. China is a massive donor to the World Health Organization (WHO), and in light of its lack of transparency, has put the credibility and independence of the WHO into question.[203] This lack of transparency has brought about the rise of theories, such as the Wuhan lab leak theory, that hardens China’s suspicious position to in-depth scientific research of such claims.[204] In 2020, then-US President Donald Trump cut funding to the WHO, thereby increasing Chinese influence among the institution’s administrative and investigative structures that decreased the institution’s accountability in discovering the origins of COVID-19.[205] Paying attention to these institutional dynamics is very important for its implications for the safety of the global population.

c) ASEAN: Regional Dynamics

The stated purpose of the Association of Southeast Asian Nations (ASEAN) is “to ensure the survival of its members by promoting regional stability and limiting competition between them.”[206] China’s association with ASEAN has evolved in accordance with its hegemonic interests. At first, China distanced itself from ASEAN, but later normalized relations with a partnership forged in the spirit of “mutual trust.”[207] From the historical point-of-view of the 1960s, many ASEAN states did not trust China as a result of its tendency to prioritize support for communist ideologies over mutual diplomacy—this included support for communist insurgents in Asia as opposed to governments.[208]

Sino-ASEAN relations began to shift during the early 1970s with then-Chinese President Deng Xiaoping, who normalized Sino-US diplomatic relations which corresponded with increased trust and improved Sino-ASEAN relations. As noted by historian Ronald C. Keith, Deng Xiaoping’s “pragmatic” foreign policy played a key role in sparking China’s great rise in power as he emphasized economic development and ‘harmony’ in the world rather than global hegemony.[209] Today, China is ASEAN’s largest trading partner and ASEAN is China’s third-largest trading partner.[210] Through improved Sino-ASEAN relations, and ASEAN diplomatic and economic support, China has recognized that its regional dominance could be attained through soft power diplomacy and institutional engagement strategies.[211]

d) WTO: International Trade Relations

In 2001 China became a member of the World Trade Organization (WTO) and has since used that membership to engage in several bilateral trade agreements with Southeast Asian, European, South American, African and North American state actors.[212] The relationship between the European Union (EU), in particular, has strengthened in recent years and has taken the form of the “EU-China Strategic Partnership” which involves different forms of cooperation and dialogue.[213] This involves the High-Level Economic and Trade Dialogue (HED) since 2008, the High-Level Strategic Dialogue since 2010, and the High-Level People-to-People Dialogue since 2012. Strengthening economic relations between China and the EU has thus produced further diplomatic cooperation.

However, during the Trump presidency, China’s economic engagement with the WTO was increasingly becoming contested. For instance, in 2020, the WTO ruled that the tariffs imposed by the US on China breached regulations.[214] In light of this ruling, US trade representative Robert Lighthizer called the WTO “completely inadequate to stop China’s harmful technology practices” and China called the ruling “objective and fair.”[215]

IV. Engaging Power: Anticipating Chinese Power Politics

The relatively peaceful post-Cold War and American-led unipolar rules-based order are finalizing its transition towards a multipolar rules-based structure where illiberal and autocratic states are challenging global stability and prosperity through regional engagement strategies of economic, political, military and technological power. In this shifting geopolitical environment and with more sweeping economic power, China is continuing its rise in power and projecting its regional hegemony across Southeast Asia by more forceful and assertive foreign policy strategies that have led to unprecedented military expansion and the ability to use their economic hegemony to project their power across the region and globally.

a) A Historical Analysis on China’s Regional Foreign Policy

On July 1st, 2021, President Xi Jinping addressed China on the 100th anniversary of the founding of the CCP. In the speech, President Xi said the following:

“The Chinese nation is a great nation. With a history of more than 5,000 years, China has made indelible contributions to the progress of human civilization. After the Opium War of 1840, however, China was gradually reduced to a semi-colonial, semi-feudal society and suffered greater ravages than ever before. The country endured intense humiliation, the people were subjected to great pain, and the Chinese civilization was plunged into darkness. Since that time, national rejuvenation has been the greatest dream of the Chinese people and the Chinese nation.”[216]

President Xi’s speech highlights the key tenets of contemporary Chinese foreign policy which hinge on the revival of Chinese regional hegemony and global great power status in a declining American-led rules-based world order.

For centuries, Chinese dynasties were the regional hegemon due to an effective system of tribute states, robust trade with foreign empires, and a lack of great power competition within their geographic peripheries. However, the refusal to take advantage of their technological and naval hegemony led to the eventual “century of humiliation”—culminating in the Opium Wars of the mid-19th century—that forever changed China’s perception of Western states and international power politics. Imperial China would be further humiliated by Japan when Tokyo fully embraced Western modernization and became the regional hegemon in East Asia in the late 19th and early 20th centuries.[217] The diminishing of China’s influence and status as the regional hegemon and a global great power inspired left-wing and right-wing Chinese nationalists across China to return to a period of Pax Sinica.

b) Chinese Geo-Security Interests in Southeast Asia

Given that there are historical overarching themes within Chinese foreign policy, it is not surprising that China has extensive goals for Southeast Asia that can be described as encroaching and ambitious. Building mostly on historic precedence, China undeniably believes in its right to exert its hegemony across the region regardless of international law and regulations.[218] Southeast Asia, and the South China Sea specifically, are just two geopolitical regions that China seeks to influence and control as part of its return as the regional hegemon and global great power. In particular, the region holds many merits for Chinese hegemony and prosperity as it accounts for 60% of global maritime trade, with an estimated worth of approximately $5.3 trillion passing through the region each year.

Globally, Southeast Asia has significant military strategic value to both China and the West. During the age of the Empires, the British crown colonies of Singapore, Malaysia, and Hong Kong served as seaborne fortresses and resupply stations for the Royal Navy, allowing them to project their power far from home.[219] Today the Philippines, Indonesia, and Thailand likewise provide the US with much-needed ports and air bases to project and defend their geo-security and geo-economic interests far from their homeland while also giving Washington the ability to extend their geopolitical power and influence, along with resupplying their worldwide military presence.

c) The Nine-Dash Line

To expand their domestic borders and exert their influence in Southeast Asia, China has implemented a geostrategic naval strategy that permits its ambiguous claim of maritime territory in the South China Sea. The Nine-Dash Line as it has been called extends China’s territorial hegemon from the Paracel Islands to the Spratly Islands—in effect creating a Great Wall of Sand.

According to China, the claim of a Nine-Dash Line is rooted in historical precedence, although this line of strategic thinking is unconvincing. In reality, the Nine-Dash-Line is a foreign policy concept that dates back to 1936 when cartographer Bai Meichu, under the Chinese Nationalist regime, conceptualized the strategy.[220] After the Pacific’s involvement in the Second World War, Chinese nationalists sought to take advantage of the power vacuum left by the Imperial Japanese Navy in the South China Sea by deploying ships to formally claim the Spratly and Paracel Islands.[221] However, when the Chinese nationalists retreated to Taiwan following the Chinese Civil War in 1949, Mao Zedong and the CCP incorporated the naval strategy as part of its regional foreign policy.[222]

The Nine-Dash Line has significant implications for China’s regional hegemony. Economically, the Line’s geography holds over 200 nautical miles of maritime territory across the region. To legitimize this claim, China signed on to the United Nations Convention on the Law of the Sea (UNCLOS), and as a result, has de jure authority and control over the region’s economic exclusive zone (EEZ). Moreover, China has used the Nine-Dash Line in recent years to redefine its military footprint by building artificial islands and placing anti-access/area-denial (AS/AD) missiles and military bases in the Line’s geographic jurisdiction to shore its hegemon posture in the region.[223] Overall, the technicality of the Nine-Dash Line has accelerated Chinese regional hegemony by encroaching on the economic and political sovereignty of several Southeast Asian nation-states.

d) China’s Regional Hegemonic Threats to ASEAN

By solidifying their naval control over the flow and access into Southeast Asia, China would have greater capability to transition the People’s Liberation Army Navy (PLAN) away from a green-water force towards a potent blue-water navy that is proficient in projecting Chinese maritime power and security through critical economic sea lanes and first strike and deterrent capabilities.

Due to the proximity between nations in Southeast Asia, multiple conventional military threats could easily lead to escalation. With firm control of the Spratly Islands and increased naval presence, China could restrict the freedom of navigation of ASEAN and other East Asian countries.[224] To ensure that its regional hegemony remains unchallenged by Southeast Asian state actors, China has built numerous man-made islands equipped with runways and ports that can be used to house its AS/AD missiles, fighter jets, military personnel, the PLAN, and its maritime militia. Coupled together, China’s military footprint is set to surpass the United States Navy in terms of tonnage, ships, and missiles, thereby dissuading ASEAN members from turning to the US for security assurances and remaining neutral in the deepening Sino-US competition for power.

To counter the major power disparity caused by China, and return a somewhat reliable balance of power in the region, Western state actors—notably the major powers in NATO like the US, France, United Kingdom, and Germany—are beginning to strategically tilt more heavily towards the region.[225] If this rush of extra-regional powers continues in earnest, it will almost certainly be perceived as hawkish and belligerent by China—declaring that Western naval forces are attempting to exert greater influence at the cost of Chinese power and authority. With Southeast Asia already being a hub for commercial shipping and accommodating the US-led hub-and-spoke alliance system, the influx of additional Western extra-regional naval, ground, and air assets could lead to more frequent scenarios that could escalate tensions between China and NATO, along with reawakening anti-western sentiments that could bring greater cooperation and diplomatic linkages between China and former European colonies in Asia.

V. Engaging Technology: The New Frontier of Geo-Security & Defence

The cyber frontier is the emerging arena that presents critical and unique risks which transcend the physical boundaries that previously characterized existential security and defence policies. As more sensitive security information in both the public and private domains are stored and protected through the use of imported technologies, the risk associated with built-in backchannels has increased. Additionally, the growing sophistication of multi-purpose technology has led to increased difficulty in monitoring its proliferation to avoid abuse by non-state actors, state proxies or belligerent state actors.

As the era of Chinese technological dominance unfolds and its influence over vital aspects of the emerging technological sphere—5G, semiconductors and artificial intelligence—cyber-threats and cyber-risks are driving strategic thought for how to engage with China and Southeast Asia. During the NATO 2030 Brussels Forum, the importance of adapting and responding to these new cyber security realities has made the Alliance focus on building its collective resilience and coordination through the NATO Cooperative Cyber Defence Centre of Excellence to deter and adhere to the new frontier of geo-security and defence.

a) Dual-Use Technology and Regulation

The need to intervene in the spread of harmful technologies to belligerent states and non-state actors is not a new issue. With the development of nuclear weapons, chemical warfare, and satellites, the risk of technology and intelligence falling into the hands of potentially adversarial actors is more pressing. To limit the proliferation of strategic materials, coordination is required. During the Cold War, NATO members, alongside Japan, supported the Coordinating Committee for the Control of Multinational Trade (CoCom). Established by the United States in the 1950s, CoCom placed a trade embargo on members of the Warsaw Pact. The CoCom embargo list contained three categories of items:[226]

1.????A munitions list that included all items that could be directly used for military purposes

2.????An atomic energy list that included sources of fissionable materials, nuclear reactors, and their components

3.????An industrial/commercial list that included items that could have civilian or military uses depending on their application

Between members, the agreement to limit military weapons was non-controversial and straightforward. However, category three contained certain dual-use items, such as jet engines, air traffic control equipment, and computers. These items were further separated into three subsequent lists. Items that were placed under embargo could be potentially lifted on a case-by-case basis if permission was requested; sold in limited quantities through a required system of licenses, thereby creating a report of all sales; and items that could be sold without a license, but their use had to be monitored closely.[227]

Since CoCom was an informal organization, it lacked enforcement mechanisms. To subvert this, the list and any amendments had to be made unanimously among all members. During the Cold War, this measure facilitated cooperation among NATO members as they were proximate to the tensions in the East-West Blocs in Europe and benefitted from collectively trying to limit Soviet military power.[228] As a result, CoCom regulated the proliferation of technology to states in the Communist bloc through multilateral export controls and information sharing.

CoCom ceased in 1994 and was succeeded by The Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies that subsist today. The Wassenaar Arrangement is currently the only transnational agreement that provides a legal framework for limiting the spread of security-related technology. Although the agreement is not binding, NATO—including former Warsaw members—generally implemented domestic policies that promoted the Wassenaar Arrangement. However, in the early 2010s, the list was updated to encompass cyber technology, including many dual-use technologies that generated revenue— resulting in the regulatory strategies between the United States and the EU to diverge.[229]

b) Dual-Use Technology

As technology advanced, the quantity and range of prohibited dual-use items are weighed against the economic incentive of exportation by taking into account the increased security risk of the proliferation of the latter. However, emerging technologies placed on the lists are not required to have the distinctive features of military or distinctive dual-use (civil-military) that traditionally invoked export control. For instance, in 2018, the US updated their national Export Control Reform Act (ECRA) and their restricted Entity List to exclude specific Chinese companies from obtaining certain technologies citing their growing dominance in high-technology as a security threat. However, the scale of this ‘threat’ and the types of technologies to avoid exporting are controversial and not agreed upon among NATO members.[230]

c) Regulation of 5G

A notable instance that reflects non-consensus regarding the ‘threat’ and ‘risk’ of Chinese cyber technology is in the regulation of 5G. Starting in 2018 Australia, the UK, and the US have all banned or partially banned the use of networking equipment sold by Huawei and ZTE—which are used as central components in 5G technology. The risks associated with using 5G equipment manufactured by Chinese vendors such as Huawei and ZTE is that they can embed malicious software code that may allow for nefarious activities, like intellectual theft and privacy and dangers to digital infrastructure security, that can traverse networks built and operated by transatlantic services providers.

Accordingly, a person associated with Huawei or ZTE located in China could use backdoors to access information traversing Huawei 5G network elements operated by North American service providers such as Bell or Verizon. In addition, another risk is that the same equipment may allow for unauthorized entry by hackers associated with belligerent state actors that could implement viruses into these networks to hijack the computer systems of governments and private industries.[231]

?

The UK originally did not ban the use of network technology from these equipment vendors, instead of implementing measures to assess, monitor, and mitigate risks that could be linked to possible backdoors. However, the US, under the Trump presidency, threatened to distance themselves from British Intelligence Agencies because of their comparatively lax stance towards Chinese technology—a remarkable notion considering the special relationship between US-UK intelligence. The US’s concern was that information transferred across a 5G network allowed for the possibility of the signal being caught in a backdoor. For example, if the UK used Chinese developed 5G and the US did not, then there would still be a risk that the communication between these two countries could be caught in backdoor signals that would need to travel across Chinese 5G technologies during the communication process.

Other countries in the EU—particularly Germany and France—require security or license reviews when purchasing from Huawei and ZTE but are not engaging in a partial ban to the same extent as Australia, the UK, and the US. Despite pressures to form a collective ban from Washington, the EU has allowed its member states to determine the extent of using Chinese 5G networks, with many EU members already requiring security regulation.[232] For instance, Italy, the first G7 and NATO member to have signed the Belt and Road Initiative, uses Chinese 5G technology but retains the right to veto the technology if they deem it a security threat.[233] Other countries, such as Spain, Austria, and the Netherlands have yet to pass particular laws, thereby remaining neutral—despite not engaging fully—with Chinese high-technology. Ultimately, the EU’s patchwork approach maintains the right of each member state to regulate their national security and is less abrasive than bans and reflects the stance of viewing 5G as a ‘risk’ rather than a ‘threat.’[234]

d) Transatlantic Policy Schism

The trend of the US taking punitive measures towards curbing China’s rise and influence in the technological market and the EU’s approach of increased caution highlights a shift in transatlantic norms when compared to the Cold War era. The EU’s policies, approaches, and assessment of risks and threats are not symmetric to the US as their economy has grown more distinct and diverse as a bloc.

A Cold-War-esque CoCom where regulations were strictly followed is less likely to occur today as contemporary ‘threat’ consensus is less clear. This framework is ultimately important to NATO as the transatlantic community must more clearly define a goal in their regulatory lists if they desire more substantial resilience to China’s growing dominance in EDTs.

e) China’s Digital Silk Road, Economic Expansion, and Cyber Security

China’s initial vision of the Belt and Road Initiative (BRI) was to build economic trade routes through infrastructure. In 2015, they added on the ‘Digital Silk Road’ which signalled their efforts to begin exporting telecommunications and informational networks—ICT information and communication technology—to members of the BRI. This project includes physical infrastructure such as fibre-optic cables and software created by Chinese firms. Moreover, 5G, smart cities, data analytics, the Internet of Things (IoT), and artificial intelligence are further examples of some other technologies included in their exported ‘bundles.’

By using large amounts of money from the Chinese Development Bank, e-commerce giants such as Alibaba, Baidu, and Tencent, and tech giants such as Huawei, HikVision, and ZTE, China can expand and export its technological systems without competition from its geopolitical rivals since integrating closely with technological systems from China often deters using Western alternatives because of the fear of possible backdoors.[235] The scope and scale of the BRI’s influence currently involve more than 60 countries, making up 55% of the world’s GDP, 70% of the world’s population, and 75% of its energy resources.[236]

Cyber security concerns regarding this vision of digitally linked cities stem from China’s access to the data that goes through these smart cities. In Southeast Asia, Indonesia, Malaysia, Myanmar, the Philippines, Thailand, and Vietnam have all signed on to BRI despite key concerns over strategic, technological and intellectual autonomy, and sovereignty. Access to data systems in these markets further facilitates Chinese technological expansion and prevents the development of local industries in the technological sector, thereby proliferating higher amounts of Chinese fintech companies into the region. Additionally, e-commerce tracing has allowed Chinese markets to further tailor their investments in Southeast Asia.

Coupled together, Chinese technological hegemony has crossed an apex point and, as a result, now impacts the national security of ASEAN members, Japan, South Korea and India. Interestingly, these emerging security vulnerabilities are not protected by sufficient international cyber laws, and no laws currently exist to deter states in Europe and Southeast Asia from signing onto the BRI—particularly since gaining access to digital infrastructure is economically and politically valuable to developing and emerging state actors.[237]

f) Technologic Supply Chains and the Asian Economy

In 2020, the Regional Comprehensive Economic Partnership (RCEP)—consisting of Australia, Brunei, Cambodia, China, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand, and Vietnam—was signed and scheduled to be ratified in 2021. The trade agreement will establish a Free-trade Zone (FTZ) between all members. Most notably, RCEP is the first free-trade bloc that includes the participation of Japan, South Korea, and China. The bloc is also the largest free-trading bloc in history by population, with 15 of its member countries making up 30% of the world’s population and 30% of global GDP.

One of the primary goals of the RCEP is to lower tariffs in the hopes of strengthening Southeast Asian supply chains. The RCEP will also outline terms of e-commerce, furthering the ties that Chinese investments have in the region. As of April 2021, high-tech exports to ASEAN are China’s third-largest export, behind electrical and mechanical equipment. The exact role of Japan and South Korea in this agreement remains to be seen, as South Korea and Japan do not trade large amounts of high-tech with China. It can be anticipated that the trilateral supply chain between the three will not include high-tech seeing as Japan has already flagged Huawei and South Korea having strong domestic technological industries.[238]

VI. Strategic Recommendations

It is important to recognize that different members of NATO have vastly varied diplomatic relationships with China.[239] With that said, NATO member states are beginning to recognize that such varied relations alongside China’s increasing global presence equate a need for finding strategic responses to the emerging multipolar environment for NATO to remain relevant as an Alliance of transatlantic and democratic states and a pillar of the rules-based order.[240] During the 2021 NATO Summit the Alliance, for the first time, remarked on the security risk China poses to the rules-based international order. Despite withholding an outright declaration of China being an existential threat like Russia does to NATO, the Alliance has shown its commitment to increase military-to-military interoperability and resiliency to Chinese attempts to exploit intra-alliance political differences and economic disparities.

To this end, the report provides the following strategic recommendations for NATO to incorporate to better deter Chinese aggression against the rules-based order in Southeast Asia and globally, along with showcasing strategic alternatives for the Alliance to pursue in developing a collective extra-regional Indo-Pacific strategy:

???Cooperative Institutionalism & Diplomatic Security:

-??NATO should develop a strategy that extends diplomatic collaboration and adheres to the mutual principles that recognize and uphold the institutionalism of the rules-based order’s norms, laws and values.

-??To avoid the claims of NATO harbouring a “China threat theory” NATO should craft diplomatic mechanisms that incentivize out-of-area cooperation on global threats and challenges such as pandemics, climate changes, nuclear proliferation, counterpiracy, and anti-terrorist operations through deepening institutional commitments to the UN.

???Recommitting the UNSC as a rules-based pillar for global challenges:

-??In light of the 2020 pandemic, vaccines have emerged as a geopolitical instrument of power. To avoid a reminiscent of Cold War dynamics, NATO and its three permanent UNSC members—the US, UK and France—are encouraged to declare pandemics as global security threats at the UN and the UNSC, thereby requiring a greater need for strategic collaboration with China to combat future pandemics on the international stage in the hope of decreasing mistrust and improve efficacies to such global challenges.

???Matching the Southeast Asia power disparity: regional collective security and NATO out-of-area engagement:

-??The Alliance should establish a NATO-ASEAN cooperation bloc with a key mandate to collectively build up its member’s military and diplomatic ability to attract and solidify their resiliency and unity against threats to the region’s rules-based structure and modus operandi from belligerent state and non-state actors, along with deterring strategic and hard power encroachment.

-??Following the NATO-ASEAN joint cooperation bloc should be an initiative that incorporates NATO leaders and personnel to prepare their ASEAN counterparts to readily identify normative standpoints among its members, thereby developing a network of diplomatic dialogues, like capacity-building programs, that prevent ASEAN members from becoming part of the Sino-US power competition while also decreasing historical mistrust among Southeast Asian state actors.

-??NATO should assist in the procurement and assistance in developing advanced defence infrastructure in the region. NATO members, like the US, UK, Canada, and Germany, have strong robust defence industries and can help build up regional militaries to return the region’s balance of power to a comparative stature. This could include fifth-generation fighters, AEGIS systems for naval vessels, and investments to build up domestic arms and research and development industries.

-??NATO is encouraged to perform regularly scheduled naval and air exercises, as well as joint maritime patrols, that can lead to deepening region-to-region and military-to-military inklings that oppose Chinese and other belligerent actors that undermine the region’s rules-based order through military coercion and aggression.

-??To avoid “mission creep,” NATO needs concrete conditions to signal outright threats that aim to undermine the territorial sovereignty and integrity of state actors that make up Southeast Asia, along with hard “red-lines” that limit or expand collective security and defence operations. These can range from the displacement of Chinese Naval bases in the Paracel and Spratly Islands, a reduction in aerial and naval patrols that encroaches on foreign sovereignty, or concrete diplomatic agreements from China to respect international maritime laws in the region.

???Article V and Cyber Threats:

-??To avoid strategic ambiguity NATO needs to outright detail the types of cyberattacks that merit the invocation of Article V, along with advancing a counter-initiative to respond to such hybrid forms of state-centric conflict collectively. Such measures will mitigate hesitation and disunity in collectively responding against threats from a state actor and its proxies.

-??To improve NATO’s cybersecurity it is recommended that more strategic clarity be used to declare attacks on military intellectual, industrial and operational infrastructure, civilian privacy data, commercial, economic, and civilian infrastructure grids, and medical centres as legitimate grounds for triggering Article V.

???Article III and Resiliency

-??It is recommended that NATO invest seriously in the development and research of a collective cyber defensive system to deter and hedge threats emerging from Chinese hegemony in disruptive technologies.

-??It is recommended that NATO members continue to meet the threshold of contributing at least 2% of their GDP on defence which can then be used for NATO activities such as developing cyber-resilience to Chinese technological State-Owned-Enterprises.

-??It is recommended that the EU and NATO collaborate on developing a pragmatic, practical and revelatory cyber security strategy that aligns the region’s political-economic capabilities to extend into new frontiers of science and technology (S&T) that can project a rules-based structure on the use and incorporation of EDTs.

???Increased Region-to-Region Dialogues on Cyber and Technological Security:

-??It is recommended that NATO expand its niche intelligence networks to Southeast Asia to strengthen a region-to-region cyber and technological partnership that can enact cybersecurity and cyber resiliency as deterrence against Chinese technological hegemony. The most notable partners in the region would be Japan and South Korea.

-??It is recommended that NATO commit its technological resources, knowledge and personnel to a NATO-QUAD technological partnership that amplifies cyber-defence interoperability, cyber-capacity sharing and stronger intelligence networks.

-??It is recommended that a NATO-ASEAN Individual Partnership and Cooperation Program (IPCP) be established. To avoid tensions among ASEAN members and China over Chinese technological hegemony, the ICPC should focus on acknowledging the need for more substantial joint cooperation on global and regional security challenges—like 5G and EDTs—to reinforce a shared strategic interest in promoting and upholding peace, stability and prosperity through pursuing a rules-based operation of technology development and civil utilization.

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