Such a setting is not ideal but we find that Southeast Asia could weather it relatively well and even enjoy a number of advantages.
One of the defining developments of our time is the increasingly fractious relationship between the US and China. No one should underestimate the dangers posed by two nuclear-armed big powers pushing and shoving against each other. That is all the more the case for Southeast Asia which will be one of the principal arenas for that big power contest.
However, before we get too alarmed, we need to assess the likelihood of outright hostilities in the first place. If that risk turns out to be fairly low, which is our base case, then what we should be looking at are the political and economic consequences of a scenario of intense competition between the big power relations that falls short of war.
