Southeast Asia has once again come under the global geopolitical spotlight due to rising tensions between the world’s major power blocs. The United States, under Donald Trump’s administration, has announced a new 10 percent tariff on BRICS member countries—a move that poses a serious challenge, including for Indonesia, which has reaffirmed its decision to remain within the bloc.
If implemented, Indonesian exports to the U.S. would face a total tariff of 42 percent—consisting of a 10 percent base tariff, an additional 10 percent BRICS-specific tariff, and a 22 percent tariff scheduled to take effect on August 1.
However, the Southeast Asian region as a whole has opted not to take an overt side. This stance should not be interpreted as indecisiveness, but rather as a strategic effort to maintain policy autonomy and protect national interests in an increasingly fragmented world.
BRICS as an Alternative, Not a Rival Bloc
BRICS—now comprising 20 countries and representing over 55 percent of the global population—offers an alternative platform for developing nations to advocate for their interests in an international system that many argue no longer reflects today’s global power dynamics. According to the International Monetary Fund (IMF), the BRICS bloc accounts for nearly 44 percent of global GDP based on purchasing power parity (PPP).
One of the core pillars promoted by BRICS is the agenda of de-dollarization. At the 2025 BRICS Summit in Brazil, President Lula da Silva called for the creation of a new international financial system that is not centered on the U.S. dollar. This de-dollarization, according to Lula, will be a gradual but crucial step toward building a more balanced and equitable system for developing nations.
Key initiatives include strengthening the New Development Bank (NDB), expanding local currency financing, and developing cross-border payment systems. The Rio de Janeiro Declaration further emphasized the importance of alternative mechanisms such as the Contingent Reserve Arrangement (CRA) and new local currency-based investment platforms to enhance the financial resilience of countries in the Global South.
National Interests and ASEAN’s Mini-Lateralism
In the context of global tensions and the rise of BRICS as an alternative power bloc, Southeast Asian countries have not remained passive. They have responded by strengthening internal and regional cooperation focused on practical interests.
Southeast Asia is a region with significant economic potential. With a population of around 700 million and a collective GDP reaching USD 3.8 trillion in 2024, it is an economic growth hub that cannot be overlooked.
However, regional economic integration remains incomplete. Instead of waiting for ASEAN-wide consensus, countries like Singapore, Malaysia, and Vietnam have initiated limited and pragmatic forms of cooperation—commonly referred to as mini-lateralism. This is evident in joint projects such as special economic zones and cross-border renewable energy collaborations.
On the other hand, despite receiving substantial investment from China—amounting to USD 17.3 billion in 2023, or 7.5 percent of total FDI inflows into ASEAN—countries in the region remain cautious.
There is growing concern that dependence on Chinese supply chains could limit their flexibility in maintaining access to U.S. markets, especially amid mounting pressure from Washington to reduce reliance on Chinese inputs.
A New Balance Point in the Global Order
What Southeast Asia is facing today is not merely economic pressure, but a tug-of-war between two competing worldviews: one rooted in legacy institutions and unipolar dominance, and another being shaped by a coalition of developing nations advocating for a multipolar and more inclusive order.
The region does not see itself as a pawn in great power competition, but as a strategic actor with its own interests and vision. Indonesia’s commitment to remain in BRICS—despite short-term economic risks from the U.S.—reflects a long-term approach centered on policy sovereignty and a balanced global order.
Southeast Asia is not rejecting either the United States or China; rather, it is asserting its right to make independent decisions. In this context, the label of “third countries” is no longer relevant. The region has become a new center of gravity in global geopolitical and economic affairs, and the choices it makes today will shape the future direction of the world.
Reference:
- https://carnegieendowment.org/research/2025/03/brics-expansion-and-the-future-of-world-order-perspectives-from-member-states-partners-and-aspirants?lang=en
- https://carnegieendowment.org/posts/2025/06/building-bridges-countering-rivals-strengthening-us-asean-ties-to-combat-chinese-influence?lang=en
- https://chinaglobalsouth.com/analysis/misreading-southeast-asia-us-china-tariff-war/
- https://geopoliticaleconomy.com/2025/07/10/trump-threat-brics-us-dollar-western-imperialism/
https://jakartaglobe.id/business/indonesia-will-not-leave-brics-despite-us-tariff-threat
