China Fears Cloud Cambodia Funan Techo Canal Game-Changer Talk
Plus coming trilateral summit; sharp power countermeasures; new trade talks; big green deal; South China Sea perceptions; China competition metrics & much more.
Before delving into this newsletter issue, we wanted to offer a special and sincere thanks to all our readers as we marked the first anniversary of ASEAN Wonk earlier this week! We sensed that there was a need for more regular analysis of geopolitical and geoeconomic developments on Southeast Asia and the Indo-Pacific when we started this last March. But we certainly did not anticipate being designated as a bestselling newsletter on this platform just months after getting started as well as being read by thousands of policymakers, businesspeople, scholars and watchers every day across more than 130 countries and 6 continents! We could not have gotten here without our readers, and thank you to each one of you!
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With Thanks,
Prashanth & the ASEAN Wonk Team
For this iteration of ASEAN Wonk BulletBrief, we are looking at:
Assessing the geopolitical and geoeconomic significance of the China-backed Cambodia Funan Techo Canal project, including its wider regional implications;
Mapping of regional developments, such as a coming trilateral summit, new leadership shifts and Israel-Gaza conflict diplomacy;
Charting evolving geopolitical, geoeconomic and security trends such as sharp power countermeasures; South China Sea perceptions; and emerging rare earths links;
Tracking and analysis of industry developments and quantitative indicators including new free trade talks; big green deal; U.S.-China trade competition metrics and more;
And much more! ICYMI, check out our post earlier this week analyzing a new book and how to decipher China’s complex Southeast Asia presence.
This Week’s WonkCount: 2,349 words (~11 minutes)
Coming Trilateral Summit; New Leadership Shifts; Israel-Gaza Diplomacy & More
Countering Sharp Power; Global Hub Wars & Assessing Identity Centrality
“The CCP has conveniently distracted us with its use of hard power at sea…while simultaneously…subtly compromising us from within,” notes a commentary over at Rappler on China’s sharp power in the Philippines based on a study conducted by the Ateneo Policy Center and supported by Konrad Adenauer Stiftung. The commentary recommends several steps, including the adoption of a Foreign Interference Act; the designation of a senior official as a counter-political warfare coordinator; and the establishment of a monitoring mechanism to track the acquisition of real estate properties near military camps or coastal areas that have strategic or sensitive value with respect to the South China Sea (link).
“Singapore [is] continuing to lead in the region, one rating point ahead of Hong Kong,” notes the latest iteration of the Global Financial Centers Index which measures the competitiveness of international financial hubs. Singapore is ranked 3rd overall after New York and London. Within Southeast Asia, the top 100 also includes Kuala Lumpur (77th) and Bangkok (93rd). Manila (101st), Jakarta (102nd) and Ho Chi Minh City (108th) are also included in the rankings (link).
Aggregate and Relative Position Changes in the March 2024 Global Financial Centers Index
“[E]thnic identity in Myanmar politics is not necessarily a divisive force,” concludes an online survey on support for the shadow National Unity Government released by U.S. Institute of Peace. Contrary to some of the literature on nationalism which can assume that ethnic and national attachments compete with each other, the survey shows they are largely positively correlated, with 77.3 percent of Myanmar ethnic minority respondents describing the importance of their Myanmar identity as equal to or greater than their ethnic identity. The survey does not claim to be representative and relies on an online opt-in sample (link).
Centrality of National vs. Ethnic Identity Among Ethnic Minority Respondents in USIP Survey
China Fears Cloud Cambodia Funan Techo Canal Game-Changer Talk
What’s Behind It
Cambodia’s premier Hun Manet recently hit out at critics of a 180-kilometer, $1.7 billion China-funded Funan Techo Canal project, spotlighting the stakes at play in the project which would bypass Vietnam and increase concerns about Beijing’s influence1. As noted previously on ASEAN Wonk, such projects feed into broader questions related to Cambodia’s alignment management under Hun Manet who took power last year; China expanding economic influence in Southeast Asia and its spillover effects; as well as evolving Mekong geopolitics. The Cambodian government has played up the project’s game-changing ability to directly connect Phnom Penh to Cambodian ports bypassing Vietnam and cutting transport costs, with water gate systems, bridges and a sprawling sidewalk charting its path from the Takeo canal of the Mekong River through four provinces to Kep along the Gulf of Thailand coast2. The project name — after an ancient kingdom which ruled over the Mekong Delta and an honorific often applied to ex-premier Hun Sen — is meant to reinforce its national importance3.
Select Recent Significant Developments Related to the Funan Techo Canal Project
Rising canal concerns have spilled into the public domain over the past few months. Cambodia has long been a country to watch in terms of China’s influence in Southeast Asia. Though much of the focus has been on Ream Naval Base, there are other concerns as well including the country’s alignment diversification, economic dependence and subregional ties with neighbors such as Vietnam which play into sensitive Mekong geopolitics4. Momentum around the Funan Techo Project began building late last year. A feasibility study pact was announced on the sidelines of the October Belt and Road Forum, where, after a round of engagement at the China-ASEAN Expo we covered in September, Cambodia along with Indonesia and Laos alone accounted for over two-thirds of all ASEAN-related outcomes5. Officials publicized reassuring Vietnam about the project including during Hun Manet’s December trip, which as we noted at ASEAN Wonk was an undercovered development amid Xi Jinping’s Vietnam visit6. As concerns have risen in 2024, Cambodian officials have tried to downplay concerns about debt and environmental risks while playing up benefits7.
Why It Matters
While much of the headlines have focused on China-related fears, the project has in fact generated multifaceted concerns despite its touted benefits (see the table below of the fuller set of risks around the Funan Techo Canal project, followed by a map of its projected pathway, additional analysis of its significance as well as what lies ahead in the coming months and what to watch).