Executive Summary – Competing Strategic Interests in the Indo-Pacific: Implications for Canada

Although great power competition is not a new phenomenon, it has become a defining focus of U.S foreign policy for the first time since the Cold War. The Indo-Pacific has featured prominently in the intensification of U.S – China rivalry through recent years due to the geopolitical characteristics defining the region across the economic, legal, and military spheres. Despite the initial controversy which followed the Trump administration’s foreign policy on China, there has been an increase in bipartisan support over the last four years. The Biden administration has shown that it wants to encircle China with various overlapping coalitions of countries that at least want China to acquiesce to a rules-based regional order. Meanwhile, China’s objective through the Belt and Road Initiative (BRI), grey zone tactics, salami slicing, and unlimited warfare, will be to disrupt the formation of alliances and partnerships to impede further development of a unifying regional order within the Indo-Pacific.

Strategically, Canada’s position would be enhanced through participation in these coalitions but currently has limited tools available to influence change without strong engagement in the region. Canada is in an uncomfortable situation at the beginning of a potentially very problematic great power rivalry, where it has essentially made a choice about whom it would have to align with for reasons of geography, economy, and culture, despite having unique national interests tied to both sides of the Pacific. As such, Canada will likely have to accept whatever the United States offers in terms of collaborative mechanisms as a tool to counter the regional influence of China within the Indo-Pacific.

The Free and Open Indo-Pacific (FOIP) diplomatic concept, introduced by Japanese Prime Minister Shinzo Abe in 2016, aims to promote the stability and prosperity of the international community through improved connectivity and the development of a rules-based maritime order within the region. FOIP represents both an end goal for Japan’s diplomatic strategy and a tool that can be used in achieving it through three stated pillars: promotion and establishment of rule of law; pursuit of economic prosperity; and commitment for peace and stability.

There are three unstated strategic goals implicitly linked to Japan’s FOIP concept: (1) to counter the growing military, economic, and political influence of China in India and Southeast Asia; (2) to integrate India in the regional strategic construct both bilaterally and through the quadrilateral security dialogues; and (3) to glue the United States to the Asia region. Looking toward the future, Japan and other likeminded countries must think about how to ensure open and liberal values while ensuring national security and economic resilience, to which the strategic flexibility of FOIP can provide an advantage.

At the heart of the dynamic Indo-Pacific region, Southeast Asia has become a focal point within the larger U.S-China strategic competition. Except for Thailand, all Southeast Asian countries have a history of colonization and are therefore resolved to avoid falling under the control of external power. As a group, Southeast Asia is the world’s fifth largest economy, but individually it is comprised of small, or medium power nations, many of which have China as their largest trading partner. The implications of Beijing’s growing power and assertiveness in the South China Sea has been a source of anxiety for many Southeast Asian states, and there is a growing concern that the United States is too distracted and its resources too limited to be a reliable counterbalance within the region. To minimize the negative impacts of great power competition, ASEAN nations need to be unified as a group, but currently, this is not the case. The response to China varies across Southeast Asian nations, dependent upon their physical proximity and historical relationship with China, their economic power, their government type, and in some cases, their political leadership.

Information sharing will be of vital importance in countering China’s political warfare within the Indo-Pacific. AUKUS and the Quad can exist, but without the complete strategic picture, China is able to destabilize nations and use this to their advantage to gain greater control. We are seeing states switch their support from Taiwan to Beijing, which is not a diplomatic problem but a whole-of-system one. Looking ahead to the next five years, Taiwan is the elephant in the room. The security, cultural, and economic issues are ultimately a question of how the region is realigning itself around this key risk.