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Southeast Asia: A region at the heart of the Indo-Pacific

01.12.2021 - Article

Megacities, dynamic economies, young populations: the countries of Southeast Asia with their more than 655 million inhabitants are developing at a fast pace while at the same time facing huge challenges.

The response of the countries in Southeast Asia to the key global issues of climate change, urbanisation, coping with the effects of the pandemic, as well as the geopolitical tensions that are becoming increasingly tangible in the region will crucially shape the international order in the 21st century.

modern skyscrapers
City centre of Jakarta© picture alliance/prisma

Dynamic development: Urbanisation and economic growth

Southeast Asia is one of the world’s most dynamic regions. Before the COVID-19 pandemic, economies in the region were consistently growing, some of them at rates of over 5%. The signs are good that they will be able to pick up where they left off. The countries’ populations are growing, as are their cities. Even now, the Indonesian capital Jakarta with its 35 million inhabitants is the second-largest metropolitan area in the world. The region is extremely diverse in terms of culture and religions. It is home to Muslims and Buddhists as well as Hindus, Christians and adherents of other religions.

Regional cooperation

The foreign and security policy clout of the states that have joined together in ASEAN, the Association of Southeast Asian Nations, has increased. The Association, established in 1967, now has ten member states and is the most influential multilateral structure in the Indo-Pacific. The member states are committed to peaceful conflict resolution and to a rules-based, multilateral system of international cooperation. In its 2020 policy guidelines for the Indo-Pacific, the German Government set itself the aim of helping to strengthen ASEAN’s capacity for action. Germany has been one of ASEAN’s development cooperation partners since 2017, and its accession in 2020 to the Treaty of Amity and Cooperation in Southeast Asia of 1967 laid the foundations for intensified cooperation, including in the field of security policy.

The establishment of the ASEAN Economic Community (AEC) in 2015 was a milestone in ASEAN’s development that promotes the growing integration of ASEAN markets. All ASEAN states have moreover pledged to reduce their greenhouse gas emissions under the Paris Agreement.

Within the framework of their development partnership, ASEAN and Germany cooperate closely on environmental protection and climate issues, economic integration and vocational education and training. Germany further supports the ASEAN Secretariat and the ASEAN Coordinating Centre for Humanitarian Assistance (AHA Centre) through projects supporting organisational development. In December 2020, during the German Presidency of the Council of the European Union, the EU and ASEAN decided to upgrade their relations to a strategic partnership. 

a woman standing at a market stall with vegetables
Market in Luang Matha, Laos© na

Challenges: Climate change and natural resources

Rapid demographic and economic growth puts a strain on natural resources, above all because of the mounting demand for energy and commodities. It is predicted that energy demand will increase by 60% by the year 2040. At the same time, Southeast Asia is one of the regions most severely affected by climate change. In the past years, Southeast Asia, too, has developed a greater awareness of the challenges presented by climate change, and has begun to stand up more confidently to the industrialised countries, from which it demands support to share the burdens more fairly.

Germany’s involvement in the region

Germany has embassies in all Southeast Asian countries with the exception of Timor-Leste, as well as consulates general in some. There are also German chambers of commerce in a number of countries. The German Government’s cooperation focuses on key issues for the future, such as the promotion of renewable energies, climate change and environmental protection. Another priority area is security and maritime cooperation to maintain the rules-based international order. In addition, it supports projects in the field of good governance (democracy and the rule of law, peacekeeping and peaceful conflict resolution) and vocational training.

golden buddha statues
Buddha statues in Wat Arun, Bangkok© picture alliance / Peter Schickert

The Sultanate of Brunei is the smallest country in Southeast Asia after the city-state of Singapore. Due to its wealth of natural resources, economic-political relations and cooperation within ASEAN are at the heart of our relationship.

Indonesia is the largest archipelago in the world and the most populous country in Southeast Asia with the strongest economy. It is also the third largest democracy in the world and the country with the largest Muslim population anywhere on the globe. Indonesia has close relations with Germany; since 2012 the two countries have enjoyed a strategic partnership. 2022 will mark the 70th anniversary of diplomatic ties between the two states. Within the framework of a global development partnership, the principal issues for our bilateral cooperation are the energy transition, climate change, green infrastructure and sustainable economic development, as well as vocational education and training and urbanisation. The EU and Indonesia are currently negotiating a free trade agreement.

Cambodia is one of the priority countries of Germany’s development cooperation in Southeast Asia. It will hold the chair of ASEAN in 2022. Since the parliamentary elections in 2018, attention has focused time and again on the situation of the opposition and of human rights groups.

In Laos, too, cooperation focuses on specific areas, in particular rural development, economic integration in ASEAN, climate change and environmental protection. In addition, Germany has stepped up its engagement for the preservation of cultural heritage in Laos, for example restoring murals and temples.

Cooperation with Malaysia, one of the most important trading partners among the ASEAN states, is especially intensive in the economic and technological spheres as well as in academic exchange. Many German companies value Malaysia as a regional production and sales hub and actively support the expansion of vocational education and training in the country. Of interest in terms of foreign policy are Malaysia’s regional stability policy, the role of Islam and human rights issues.

Myanmar had been democratising fast since 2011, but all its progress was destroyed by the military coup in February 2021, which plunged the country into a profound political and humanitarian crisis.      The German Government has repeatedly condemned the coup and the continuing brutal repression by the military, and, together with its European partners, has imposed sanctions. Germany and its international partners are working towards a political settlement to the crisis in Myanmar. The efforts of the ASEAN countries and the United Nations play a central role in this regard.

Relations with the Philippines focus on cooperation on climate policy issues and on vocational training and immigration by skilled workers. In addition, the German Government supports the Bangsamoro peace process and provides humanitarian assistance following natural disasters, which often hit the country. The human rights situation has been under special observation in the past years, in particular in connection with the war on drugs.

Germany has maintained close relations with the city-state of Singapore since its establishment in 1965. Singapore is one of Germany’s principal trading partners in Southeast Asia, with over 1500 German companies operating there. It is a key financial centre and an outstanding partner in science and research. Its regional importance, its stability and its commitment to the regional organisation ASEAN is reflected in the intensive dialogue on foreign and security policy. A free trade agreement is in place between the EU and Singapore.

Germany and Thailand have maintained diplomatic relations and enjoyed friendly ties for 160 years. Thailand is an important Southeast Asian partner for Germany, both as regards cooperation with ASEAN and with the United Nations. Germany is Thailand’s prime trading partner within the European Union; Thailand is Germany’s third largest trading partner in ASEAN. Germany is Thailand’s most important bilateral climate partner through the International Climate Initiative. Before the COVID-19 pandemic, an average of almost 900,000 German tourists visited Thailand each year.

Germany and Viet Nam have maintained diplomatic relations since 1975. The Vietnamese economic miracle began when the Communist Party decided in 1986 to open the country for business. Viet Nam has since become Germany’s most important trading partner in Southeast Asia. In 2011, the two countries agreed on a strategic partnership to strengthen political, economic and cultural relations. This partnership now includes the German-Vietnamese Rule of Law Dialogue. The some 165,000 Vietnamese who have worked or studied in Germany form a vital bridge between the two countries. The EU concluded a free trade agreement with Viet Nam in the year 2020.

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