Eurasia Press & News
Why Middle Powers—and Small Countries—Are Vital to U.S. Strategy
It may be a confusing and unpredictable moment in global politics, but there is no shortage of frames and narratives that purport to explain or at least characterize the major developments. For many observers, Russian President Vladimir Putin’s invasion of Ukraine and the Chinese leader Xi Jinping’s increasingly aggressive saber rattling across the Indo-Pacific have divided the world into blocs, dragging the United States and its allies into a “new Cold War” pitting Washington against Beijing and Moscow. Others see this as an era of competition among great powers, in which the United States and China are the central protagonists in a global struggle. The latest U.S. National Security Strategy reflects this view, concluding that “a competition is underway between the major powers to shape what comes next.”
But these frames are oversimplified and outdated: they overemphasize the unilateral power of the United States and China, underappreciate both countries’ own dependencies, and overlook the vital importance of middle and small powers, as well as commercial entities and other nonstate actors. Although some aspects of the Cold War hold true today, such as the geopolitical rivalry between two powerful countries with dramatically different political systems and ideologies, the integration and interdependence that characterize the international system in this century places today’s policymakers on a vastly different landscape than the one their twentieth-century predecessors navigated.
The competition that confronts the United States is not simply a bilateral contest with another great power. Nor is it one that pits cleanly demarcated authoritarian and democratic blocs against one another. It is instead an ever-shifting competition of coalitions and of informal and often ad hoc groupings of partners that come together to address a specific issue or set of issues. As Hal Brands and Zack Cooper noted in 2020, these coalitions differ depending on the issue at hand; the partners involved in the geopolitical balancing of China’s growing military power in the western Pacific may be different from those that partner to safeguard and promote advanced technologies. Some groupings form naturally, consisting of willing and like-minded partners. Others bring together reluctant partners in relationships formed out of necessity or convenience.
In this world of ad hoc groupings and coalitions, Washington sometimes needs to work with actors who do not support—or are even outright hostile to—some U.S. interests or values. Occasionally, the United States will need to use inducements and even outright pressure to bring actors into alignment with U.S. goals. But if these coalitions, groupings, and individual relationships are managed adeptly and with a clear objective in mind, the United States can advance its own interests while helping build a resilient and stable international order that sustains prosperity for its allies and partners.
These new realities require a shift in U.S. tactics and strategy—and, perhaps most important, a new long-term mindset. For starters, an effective Indo-Pacific strategy will require Washington to pay increasing attention to medium and small powers—in Europe, in Southeast Asia, and across the African continent—which will play a crucial role in responding to Beijing’s advancing capabilities. More broadly, to prosecute a grand strategy in a world of not just close partners and allies but also expedient bilateral relationships and unstable ad hoc coalitions, the United States will need to be comfortable operating in the murky middle between interdependence and autonomy, between multipolarity and division into blocs, and with partners whose willingness to join Washington will shift from issue to issue.
A coalition-centered approach does not mean simply appealing to the lowest common denominator, but rather focusing on coordination and calibration with key partners to sustain a robust network of aligned actors focused on a set of clear objectives. The Biden administration has generally been an effective practitioner of this approach, but it is contested in today’s Washington, where some voices advocate for a more unilateralist, zero-sum competition with China that demands U.S. partners choose sides. That posture, however, would provide room for Beijing to navigate between and around U.S. partners, thus leaving the United States more isolated and ultimately less secure.
AROUND THE WORLD
Nowhere is this need for a new mindset clearer than in Taiwan. To be able to better deter and ultimately defend the island from a possible Chinese assault, the U.S. military must look beyond Japan and South Korea, where U.S. bases lie uncomfortably within range of Chinese missiles. With the exception of Australia, where the U.S. military presence is expanding and defense cooperation deepening, the only other places where Washington can seek new opportunities are in Southeast Asia and the Pacific Islands. Over the last decade, Singapore, a city-state with a population of five million, has quietly become an important partner in this regard. Although not a formal U.S. ally, today it anchors the U.S. military presence in Southeast Asia, supporting rotational deployments of littoral combat ships, surveillance aircraft—and, perhaps soon, drones. Singapore also serves as a logistics and refueling hub. Recent agreements to expand access, exercises, and training with the Philippines, and to deepen defense cooperation with Papua New Guinea, also reflect the necessary U.S. effort to diversify.
Economically, the complex supply chains and innovation ecosystems that underpin the development and production of advanced technologies are driving unprecedented cross-border integration, with small economies often playing critical roles in key industries. To develop more secure supply chains in the semiconductor industry, Washington is seeking deeper coordination with the Netherlands, Japan, South Korea, and Taiwan. And to reduce reliance on China for critical minerals, Australia and Indonesia—along with other potential U.S. partners in South America and Africa—are positioning themselves as key alternative sources of supply. Indeed, one of the reasons Beijing is working so hard to court Europe and the global South is that China understands how vital actors in this region are in shaping the larger strategic competition.
None of this diminishes the significant advantages and power that the United States still possesses. But the role of the small looms large in this twenty-first-century competition of coalitions. Consider the case of the Netherlands, which, with a population of less than 20 million, is home to a single firm, ASML, that is vital to global semiconductor production. ASML is the sole global provider of the latest generation of photolithography scanner equipment, critical to the manufacture of cutting-edge logic chips. That is why alignment with the Netherlands—along with Japan, another key supplier of semiconductor manufacturing equipment—was critical to the success of the sweeping export controls that the Biden administration imposed in October 2022, which limit the materials and technology available to China’s semiconductor industry. Washington’s pathbreaking effort to restrain China’s capabilities in a critical technology thus depended on support from the eighteenth-largest economy in the world and the compliance of a single private company.
Beijing, like Washington, is stuck in a world of tradeoffs.
Of course, long-standing treaty allies and the world’s major economies will continue to be a key pillar for U.S. strategy. Since the Russian invasion of Ukraine, the G-7 forum has undergone a dramatic revitalization, and today it serves as the primary venue for coordinating policy on confronting Moscow and assisting Ukraine. On many issues related to strategic competition with China, coordination with the G-7 will continue to be a starting point for the United States; for example, when it comes to considering limits on investing in high-tech sectors in China. Such measures will be effective, and avoid losses for U.S. firms, only if other countries impose similar measures in the same sectors—and the coalition-building will start with the G-7. In defense, NATO and U.S. treaty alliances in Asia, which provide a solid legal framework for U.S. military presence and activities, will continue to be the foundation for U.S. strategy.
But the larger dynamic, in which the United States depends on states and commercial partners of all sizes and compositions to forge an effective and sustainable China policy and Indo-Pacific strategy, will play out again and again across the globe and across all critical domains of strategic competition. Whether the United States is trying to build influence in standard-setting bodies or ensuring an effective defense posture that deters Chinese aggression, success will depend on Washington’s ability to partner and align with a varied range of actors, including small and medium-sized players.
But a successful coalition building strategy will require navigating the functional and structural realities these partners face, and doing so with nuance and patience. Perhaps most important, members of any given coalition or grouping will likely also have deep economic and diplomatic ties with China, with little interest in joining an explicitly anti-China bloc—and little ability to do so, given domestic political realities. This is true of countries both large and small; even Japan, arguably the country in Asia most concerned about China’s growing power, is deeply dependent China’s economy for its own prosperity. The same goes for the countries of the Association of Southeast Asian Nations, all of which have deep and growing economic links with China. Thus, in addition to its own interdependencies with China, the United States will be influenced and constrained in how far it can push against China by the interdependencies of its coalition partners. Though many countries in the region harbor deep concerns about China’s ambitions, none are willing to explicitly align against it, and most are even cautious about the extent to which they can directly inveigh against Beijing; these partners will continue to pursue hedging strategies that seek to balance engagement among external powers. A recent survey found that a majority of people across Asia believe that the consequences of U.S.-Chinese strategic competition will be negative; more than 60 percent think their country’s national security will be placed at risk. And for countries close to China, the prospect of conflict is existential. As the president of the Philippines, Ferdinand Marcos, Jr., said in a recent interview about U.S.-Chinese tensions over Taiwan: “I learned an African saying: When elephants fight, the only one that loses is the grass. We are the grass in this situation. We don’t want to get trampled.”
For its part, China also faces a similarly complex geopolitical terrain. Even with all its economic and military heft, Beijing depends on key bilateral and commercial relationships to power its economy and modernize its military. China is a net energy importer, requires continued access to a U.S.-controlled global financial system, and is far behind Japan, South Korea, Taiwan, the United States, and key European states in the design and manufacture of advanced semiconductors. For all of Beijing’s bravado about the superiority of its political system and its talk about self-sufficiency, the Chinese Communist Party faces critical dependences that will not disappear for the foreseeable future. That helps explain China’s awkward pursuit of good relations with European countries (which are some of its largest trade and technology partners) and Moscow (a key security and energy partner), despite the fact that its relationship with the latter threatens its relationship with the former. Beijing, like Washington, is stuck in a world of tradeoffs.
GET REAL
As the United States wrestles with a fluid international system, it should follow a few key principles. First, in a world in which few countries are willing to explicitly align against China, the United States will need to be careful when presenting partners with zero-sum choices, limiting those moments to cases where explicit alignment against China is absolutely necessary to protect vital U.S. interests. It must define narrowly those elements of the strategic competition with China that most require cooperation from others, and in those instances, it must bring the full weight of U.S. diplomacy and persuasion to bear. But otherwise, Washington must give partner governments the space to define their relationships with China in ways that comport with their interests and local realities. Here, the Biden administration’s stated approach to the technology competition—building a “high fence” around a “small yard” of advanced technologies with military applications—makes sense if vigorously applied. But Washington must resist pressure at home to ceaselessly expand the list of controlled technologies and other measures designed to impede China’s advance, for the simple reason that the higher the fence, the harder it will be to build and sustain a coalition. In some key technologies, such as semiconductors, it is worth putting significant pressure on partner countries and commercial actors to follow the U.S. lead, but there will be other technologies and actions—such as outbound investment screening—where Washington may prudently need to calibrate its approach to sustain the integrity and effectiveness of the larger coalition and avoid damaging the interests of U.S. commercial actors.
Similar care must be taken on issues related to Taiwan. Although countries are increasingly willing to speak out in support of peace and stability in the Taiwan Strait (as illustrated by the joint statement issued by Marcos and U.S. President Joe Biden in May), political or material support for Taiwan itself is another matter—even for a country such as Japan, which given its geographic proximity would be heavily impacted by a cross-strait conflict. Washington needs to continue to lead on this issue and bolster support for Taiwan in pushing back against Chinese coercion, expanding Taiwan’s international space, and increasing economic integration and resilience. But to expand the coalition of actors supportive of Taiwan’s prosperity and security, the United States must balance the need for resolute action in the face of Beijing’s belligerence with the understandable reluctance of many middle and small powers to be drawn into a conflict between Washington and Beijing over Taiwan. If Washington truly wants to deter Beijing, it will require a large, coherent, and credible coalition of partners who can—in their own way—signal to Beijing the significant diplomatic, economic, and military costs it would pay for carrying out a military assault in the Taiwan Strait. And, crucially, the more steady-handed and predictable Washington is in its approach to cross-Strait issues, the more it will give current and would-be coalition members the confidence and political space to align with U.S. efforts.
Although close relations with the United States remain a priority for most countries in the region, most also see significant material benefit in cooperation with Beijing. If China’s economy continues to slump, this picture may look different a decade from now. But for now, this is a reality the United States cannot avoid. Washington will thus need to incentivize participation in the coalitions that it leads, with positive inducements that advance the national interests of U.S. partners. In this area, U.S. policy has fallen short lately: although many countries in the region appreciate the renewed U.S. security focus on the Indo-Pacific—including strengthening alliances with Australia, Japan, the Philippines, and South Korea—the absence of a compelling regional economic agenda undermines U.S. influence. The U.S.-initiated Indo-Pacific Economic Framework is a poor competitor for the extensive investment and trade links that China offers. The promise of increased access to the U.S. market, through legally binding trade agreements, continues to be the most persuasive tool that Washington has at its disposal to incentivize cooperation and encourage partners to make decisions at home that they would otherwise avoid. A key element of U.S. strategy must include renewed commitments to the multilateral trading system and a willingness to negotiate meaningful market-access agreements. Of course, in the near term, this approach faces stiff domestic political headwinds, but the United States cannot make the case for its partners to sacrifice economic and commercial opportunities in China without offering tangible incentives of its own.
Washington also needs to show more awareness of the domestic political situations its partners face. The fact that some coalitions and individual partners say one thing in private and another in public is often less a demonstration of cowardice and more a reflection of political and economic realities constraining overtly anti-China actions. Privately, officials across the Indo-Pacific express deep anxiety over China’s intentions and its behavior and welcome efforts by the United States to counter Beijing’s malign effect on the regional order. But public expressions of these concerns invite political, diplomatic, and economic blowback from Beijing. Although the United States, an economic and military superpower, can withstand almost any type of pressure China can muster, most other countries can ill afford to act with such confidence. The United States must help build the resilience of coalition members who face Beijing’s economic coercion. But until such a toolkit is forged, it must remain sensitive to practical risks smaller economies face.
Washington can help aid the leaders of current and would-be coalition members by calibrating its own rhetoric and actions to reflect the domestic realities of its partners. Couching U.S. actions in the Indo-Pacific solely in terms of a strategic competition with China will make it harder, not easier, to build momentum in the region. A recent joint statement issued by the leaders of the countries that make up the Quadrilateral Security Dialogue—Australia, India, Japan, and the United States—represents an effective manifestation of this more calibrated approach. The text of around 3,000 words describes the Quad countries’ plans to deepen cooperation in the Indo-Pacific—and China is never mentioned. In a world where Washington must nimbly construct many different coalitions to push back on Chinese revisionism and support a free and open order, it will often be wise to not say the quiet part out loud.
