2020 was a turbulent year in history that will be remembered for a long time: Exactly 100 years after the last pandemic, the Spanish flu, a new corona virus spread rapidly from the Chinese province Hubei around the globe. While the vaccination campaigns which started in December 2020 raise hopes that the COVID-19 pandemic can eventually be managed, it will take years to resolve the negative socioeconomic effects it had on almost all nations. A second key event in 2020 was the presidential election in the United States (US) on 3 November: The Democratic candidate Joseph R. Biden, the former Vice-President of President Barack Obama (2009–2017), defeated the incumbent Republican Donald J. Trump. While the Biden administration already started to fulfill its promise to revive Obama’s multilateral foreign and security policy, Trump’s confrontational approach towards China survived the change in government: Biden went even further than Trump, when referring to “a commitment” of the US to defend Taiwan (Ward 2021). Even the diplomatic tone between Washington and Beijing has not changed significantly to the better.

The Trump administration was from the very beginning on China-critical. It regarded China’s trade practices as unfair and launched a trade war against the People’s Republic of China (PRC) in 2017. Moreover, it regarded China’s growing technological capacities with suspicion. Accordingly, it pressured its partners to ban the Chinese companies Huawei and ZTE from getting involved in building their 5G network infrastructure (Drezner 2019: 12). Being in general an opponent of multilateralism, Trump withdrew from the Trans-Pacific Partnership (TPP) which should have included Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. It was designed by the Obama administration to create a strong complementary economic pillar in addition to the security engagement to check China’s rising regional influence. However, despite canceling the TPP, the Trump administration did not withdraw from the Indo-Pacific, as the Asia Reassurance Initiative Act (ARIA) of 2018 (Congress of the USA 2018) and especially the increased number of Freedom of Navigation Operations (FONOPs) in the South China Sea demonstrate (Storey 2020: Table 1).

The Sino-US relations are characterized by an increasing geopolitical and geo-economic rivalry, as both the US and China assume that the other side strives for regional and even global hegemony. Even though the US has, in the last decades, proven all predictions of its decline wrong, China’s increased attempts to reclaim its century old great power status poses a major challenge to Washington’s global power projection capabilities. For the time being, however, the US remains the dominant military power in the Indo-Pacific, building on its security partnerships and military presence, including its foreign military bases and the 7th and 8th fleet. The Biden administration seems committed to maintain the US engagement in the Indo-Pacific.

In response to China’s perceived strategic aspirations, the US treats Beijing, depending on the specific constellation, as partner, competitor, or strategic rival (Blinken 2021). Although a confrontational relationship between the US and China, characterized by the desire to act as regional or even global norm-setter, seems very probable, a détente, similar to calmer periods of the US-Soviet Union relations during the Cold War, cannot be ruled out either. Whether it unfolds in a peaceful or more confrontational manner, the fundamental antagonism and the struggle for hegemony between the US and China will first and foremost play out in China’s near abroad – in Northeast and in particular in Southeast Asia. Southeast Asia, a geostrategic crucial region, has century old relations with China, with the Middle Kingdom being the dominant side. Since the end of the Cold War, China’s power and consequently its economic and political influence on the Southeast Asian nations grew significantly. In these last three decades, the PRC was repeatedly regarded with skepticism, especially as it upgraded its military spending. Beijing responded with charm offensives to the so-called China threat debates in the 1990s and early 2000s (Kurlantzick 2006). However, despite tangible economic gains for the Southeast Asian nations stemming from closer ties – in particular, through engaging in the Belt and Road Initiative (BRI) – there remains a crucial irritant in the relations: the unresolved territorial disputes in the South China Sea. In other words, China’s display of its hard power in the South China Sea undermines its attempts to improve its attraction in Southeast Asia through employing soft power, not least in form of promoting the BRI. Beijing has not yet developed a sophisticated smart power strategy which would combine material and ideational forces in a consistent and credible manner, able to convince other nations of its self-declared peaceful and benevolent intentions (cf. Nye 2017, 2009).

Economically and militarily, China can already be regarded as a superpower – and it is still further on the rise. The US and all other nations, be they big or small, have to respond to this development, and China to their reactions. The strategies and the behavior of the major powers and their interactions, chief among them the Sino-US relations, directly impact on the regional dynamics, partnerships, and counter-partnerships in Southeast Asia and the larger Indo-Pacific region. The higher the degree of polarity of the regional order in the Indo-Pacific, the higher is the risk of instability and insecurity. Adding to the insecurity are question marks concerning the long-term stability of the Chinese political system, notably after the end of the era Xi Jinping. Already today, the situation in Asia is “unstable, unpredictable and increasingly well-armed” (Denmark 2020: 87). However, an assessment written in 2010 is still valid: “despite pervasive frictions and contrary to neorealist predictions” (Pempel 2010: 221), no major military conflicts are fought out in the region.

In line with many colleagues (Lai and Kuik 2021; Emmerson 2020a: 26; Beeson 2019; Wu 2019: 569; Zhao and Qi 2016: 485; Jackson 2014: 333–336; Goh 2005: 2; Chung 2004), I propose that in response to the broad set of structural incentives and constraints in the Indo-Pacific and in particular to China’s economic and military rise, the Association of Southeast Asian Nations (ASEAN) and the majority of the Southeast Asian governments pursue a hedging strategy towards the PRC. A hedging strategy can simultaneously contain both elements of cooperation (e.g., in economics) and confrontation (e.g., in security affairs) to cope with the risks and uncertainties stemming from the behavior of a superior power. The objective of the hedger is to reap political, economic, and/or security benefits from the hedging target. At the same time, he seeks to insure himself from becoming dependent on this state through a mixture of, at the first view, contradictory and conflicting policies and actions (see Chapter 2). With the exception of Laos and Cambodia which are economically increasingly dependent on China, there exists in Southeast Asia no empirical evidence for strong alignment or bandwagoning with China – or the US, the main security provider for most Southeast Asian countries. The insight of the political leaders in the necessity of maintaining equidistance between the two superpowers is in fact a key feature of the international relations in Southeast Asia.

The main reason for this cautious behavior is the notion of security which is in Southeast Asia defined in comprehensive terms, including traditional and non-traditional threats, but also regime security (Gerstl 2008). To boost their output legitimacy and thus regime security, the Southeast Asian governments traditionally prioritize socioeconomic development (Pempel 2010: 213). The relations with China and the US offer both security and economic opportunities and risks. While the BRI seems to present Southeast Asia at the first sight interesting economic perspectives, the PRC poses due to its assertive behavior in the South China Sea considerable risks to national and regional security. This study regards the BRI as a key frame for Beijing’s conduct of its external relations and the South China Sea dispute as the main obstacle for closer Sino-Southeast Asian relations. The BRI and the South China Sea dispute will therefore set the frame for analyzing the hedging strategies of ASEAN, Malaysia, the Philippines, and Vietnam towards China.

The three research questions pose: First, why do the regional organization ASEAN as well as the three smaller powers Malaysia, the Philippines, and Vietnam hedge against China? Second, why and how do the four hedging strategies differ? And third, how did the BRI and the South China Sea dispute impact on the hedging strategies?

Theoretically-methodologically this study employs a re-conceptualized hedging framework which draws on Cheng-Chwee Kuik (2016a, 2016b, 2008). The main innovation of this novel framework is the introduction of a component covering, first, the perceptions of the political leader(s) of the hedger of risks and opportunities in their nation’s relations with the potential hedging target and, second, of the strategic value of other great powers as potential balancing partners. The other four components cover the political-diplomatic and economic engagement as well as the limited balancing and limited bandwagoning behavior directed against the hedging target. The relations with other key partners, notably the US and Japan as well as Australia, the European Union (EU), India, Russia, and South Korea, will be covered in these four dimensions as well in order to assess the influence of China in a comparative perspective. All in all, the employed hedging concept is broader and more comprehensive than previous approaches, thus significantly improving its analytical and comparative power.

To answer the research questions and ensure comparability of the results, ASEAN, Malaysia, the Philippines, and Vietnam will be analyzed separately, using above theoretical framework. Each chapter starts with a brief assessment of the relations with China, with a focus on the BRI and the South China Sea. Subsequently, in line with the five components of the hedging framework, the perceptions of the leadership, the political-diplomatic and economic engagement of China as well as the behavior in the security sphere (limited balancing and limited bandwagoning) will be examined. For the latter, the South China Sea dispute provides the lens for the analysis. The time frame of the analysis is from 2013 until 2021, for Malaysia until the end of the second term of Prime Minister Mahathir in 2020.

Apart from contributing with a re-conceptualized, universally valid hedging framework to theory-building in International Relations (IR) Theory, the theoretically-guided assessment of the hedging strategies in Southeast Asia will add significant new empirical knowledge to the existing body of literature in IR, Security, and Asian Studies. The comparison of the four case studies will show the differences and similarities of the hedging strategies of ASEAN and selected Southeast Asian nations towards a great power and reveal the underlying reasons and motives therefore. Last but not least, the literature on the responses of BRI participants to this initiative will be enriched. Although the number of respective studies is growing (e.g., Chao 2021; Chin 2021; Kuik 2021a), “there is not much attention given to the response of the [BRI] recipient countries” to this initiative (Chin 2021: 9).

The case study on Malaysia is an extended version of an article published in the Journal of Current Chinese Affairs (Gerstl 2020a); the article also includes a shorter introduction of the hedging framework. A considerable shorter analysis of the Philippines’s hedging strategy was published in the also peer-reviewed NSU (Novosibirsk State University) Vestnik in early 2021 (Gerstl 2021a).

In the remaining part of this chapter, the BRI will be discussed, followed by a brief assessment of Southeast Asia in the New Silk Road scheme and a pointed analysis of the South China Sea dispute. In Chapter 2, the concept of hedging will be critically discussed and the re-conceptualized hedging framework introduced. In Chapters 3–6, the framework will be applied on ASEAN, Malaysia, the Philippines, and Vietnam, respectively. Finally, in the conclusion, the hedging strategies of these four actors will be compared and strengths and potential shortcomings of the hedging framework re-assessed.

The New Silk Road is a defining project for the era Xi Jinping and linked to Xi’s dream of the renewal of Chinese might and international influence. The President and Secretary General of the Communist Party of China (CPC) announced the BRI in two speeches in Kazakhstan and Indonesia in September and October 2013, respectively. Aiming to improve trans-regional connectivity in the transport, trade, energy, digital, and human sphere, the BRI consists of the land-based Silk Road Economic Belt (SREB) and the 21st Century Maritime Silk Road (MSR). Therefore, the term ‘New Silk Roads’ seems more appropriate than the more frequently used singular. Geographically the initiative is not restricted, encompassing Central, South, Northeast and Southeast Asia, Oceania, the Middle East, Europe, Africa, Latin America, and the Arctic. The BRI can be regarded as a truly global geo-economic initiative with increasing intended and unintended geopolitical repercussions on the participant countries and the bystanders alike. The most prominent critics are the US, Japan, and India, albeit the latter two cooperate with China in infrastructure construction.

Until mid-2016 known as One Belt, One Road (OBOR), the BRI builds on existing Chinese initiatives (Swaine 2015). Among them are the economic ‘Going Out’ strategy and the Great Western Development policy targeting the inland provinces, both initiated under former President Jiang Zemin in 1999 (Rogelja 2019: 27–33; Ghiasy and Zhou 2017: 6–8). These two pillars demonstrate that the BRI has, first, a strong domestic logic, namely preserving socioeconomic development and domestic stability (Brown 2018: 216–217). To export overproduction, for instance, the building materials steel and cement, as well as the provision of jobs for Chinese workers outside the PRC to reduce unemployment are additional, domestically motivated factors, also the attempt to internationalize the Yuan-Renminbi (Pu 2016: 113–114). Second, the foreign economic policy and foreign policy motives feature prominently, too. The security dimension, though, has not yet been developed in detail beyond the vague vision of a “community of common destiny” (Zhang 2018). And, third, the dimension of people-to-people contacts is strongly highlighted in the official BRI narrative. This demonstrates the pragmatic and functionalist approach behind the New Silk Road to create mutual trust among the participants which should spill over to various policy areas, gradually enabling further collaboration.

All in all, the BRI resembles more a vast basket in which different domestic and external interests of different national, provincial, and local actors in China as well as various associated policies have been put rather than a sophisticated and cohesive grand strategy ready to be implemented (Gerstl and Wallenböck 2021: 3–4). An illustration for this argument is the Health Silk Road. Xi proposed it in 2015/2016 as part of the BRI in order to safeguard health security among the participant countries (Tang et al. 2017). Yet, it wa...