Storm clouds gather over ASEAN as it enters 2025

2024 saw ASEAN cope with two key regional challenges — the Myanmar crisis and tensions surrounding overlapping maritime claims in the South China Sea. These challenges will continue to test the forum in 2025, but the year need not become a crisis point. Success depends on member states’ ability to work together despite external pressures.

Since the military coup in 2021, Myanmar has been in a state of political turmoil, with an ongoing civil war leading to a humanitarian crisis. ASEAN’s response to the crisis has been largely criticised for being ineffective.

China’s assertive claims over the South China Sea, which overlap with the territorial claims of several ASEAN members — Brunei, Malaysia, the Philippines and Vietnam — remain a flashpoint. The slow pace of the negotiations on the Code of Conduct continues to undermine regional stability.

Perhaps the most concerning aspect of the South China Sea disputes is the escalating tension between the Philippines and China that led to physical confrontations, with injuries suffered by Filipino personnel, in June 2024.

Besides regional challenges, ASEAN also had to contend with the rivalry between the United States and China. Tensions between these two great powers over trade, the South China Sea, Taiwan and technological competition are making it harder for ASEAN nations to maintain neutrality or strategic autonomy.

In 2025, Myanmar, the South China Sea and the US–China rivalry will continue to be the dominant issues, albeit more challenging.

On the Myanmar front, ASEAN may be placed in a difficult position given the military junta’s push for a general election to be held in 2025 — an election that will likely be designed to entrench the junta’s stay in power. ASEAN will need to decide whether to endorse the election, even if it is not free and fair and does not garner the broader support of the country’s population. ASEAN must consider this issue carefully, as its credibility will be impacted if it endorses an election perceived as a ‘sham’.

Beijing has also demonstrated that it has sided with the junta after providing the latter with combat aircraft in September 2024. If more Chinese weapons flow into Myanmar to support the junta, the civil war will likely be prolonged, and an increased outflow of refugees may put pressure on ASEAN members such as Indonesia, Malaysia and Thailand. ASEAN must push China to cease arms supply to the junta.

On the South China Sea issue, the Code of Conduct negotiations will continue without much progress, primarily due to lack of trust from the different parties.

The China–Philippines confrontation over their overlapping claims in the South China Sea is a potential flash point. Given China’s aggression in 2024, Manila is pursuing defence cooperation with multiple partners and ramping up its military modernisation. In December 2024, Manila declared its intention to acquire the Typhon midrange missile system, attracting Beijing’s ire.

US President Donald Trump’s return to the White House is another critical variable that may impact ASEAN, especially on the economic front. He launched a tariff war with China, worsening trade relations between Washington and Beijing as the former attempts to check China’s growing clout in advanced technology. Already under the Biden administration, Washington announced that it would impose tariffs on solar panel imports that Chinese manufacturers produce in four ASEAN states — Cambodia, Malaysia, Thailand and Vietnam.

With Trump focusing on reducing trade deficits, ASEAN could be a primary target. According to the ASEAN database, its members in 2023 have a total trade surplus of more than US$160 billion with the United States.

Despite the gloomy outlook, there are silver linings.

The Malaysian government under Anwar Ibrahim has an ambition to lead ASEAN in resolving the Myanmar crisis. With the right strategy and approach — one that brings all parties to the negotiating table — Malaysia could lay the groundwork for Myanmar to find lasting peace.

The South China Sea dispute is complex, involving several parties with different interests. In particular, the Philippines’ confrontation with China could be intertwined with the US–China rivalry and tensions over Taiwan. As the ASEAN Chair and given its warm relations with China, Malaysia could be the bridge between China and other ASEAN claimants to ensure the conflict does not escalate further.

On the economic front, ASEAN members — Malaysia, Thailand and Vietnam — became partners of BRICS in 2024, an economic bloc that could be a counterweight to the Western-led G7.Indonesia became a full BRICS member in early 2025.

As the Chair of ASEAN, Malaysia could act as a bridge between the Southeast Asian regional grouping and BRICS. ASEAN could also leverage regional groupings, such as the Gulf region and Central Asia, to pursue common economic interests and minimise the impacts of Trump’s zero-sum approach on trade.

ASEAN will have its work cut out in 2025. The organisation’s effectiveness in addressing Myanmar’s political crisis, maritime disputes and great power competition will determine its relevance in an increasingly complex regional order.