This article first appeared in Forum, The Edge Malaysia Weekly on July 21, 2025 - July 27, 2025

The global landscape is rapidly evolving amid a sharp decline in the liberal international order. Multilateralism, human rights standards and democratic norms are receding. Geopolitical and economic power is gravitating towards the East in the so-called “Asian Century”. On the one hand, tensions are manifesting in the decay of Western power under a tide of far-right governments typified by US President Donald Trump’s second presidency. On the other, is the rise of the BRICS nations as a new credible economic and power block in a new multipolar world order.

Australia has long been a staunch ally of the US and the UK, relying on security and economic partnerships to navigate international challenges. The Australia–United Kingdom–United States (AUKUS) partnership, and especially the attack subs that come along with it, is a dramatic restatement of this commitment. Yet, the recent expansion in BRICS membership means this bloc now covers 45% of the world’s population, 44% of its oil, and 35% of its gross domestic product (GDP) — and with some 40 other states wanting to join, it can no longer be ignored.

Riding on the back of BRICs is Asean, a regional economic bloc with 10 countries and soon to be 11th member state, Timor-Leste. Asean holds 8.7% of the world population and 7.2% of global GDP, and is becoming increasingly influential in the region and globally, especially as the driving force of one of the largest trade blocs in history, the Regional Comprehensive Economic Partnership.

Surprisingly, while Australia is geographically within the Asian sphere, it has chosen not to be part of BRICS or Asean. The seismic structural shifts across world order and Australia’s tenuous position in terms of links with UK and US, suggests that Australia should be reassessing its economic and political alliances and not rely on simplistic “strategic” calculations (typically made with very short-term variables in mind) and, instead, adopt a reflexive approach to its own independent foreign policy, one crafted with its immediate region and neighbours as central.

Australia’s foreign policy has long been intertwined with the 1951 Australia, New Zealand and the United States (ANZUS) treaty, aligning with the global interests of the US. While this alliance has provided substantial economic support and opportunities, it has also thrust Australia into multiple conflicts, and fostered unnecessary threat perceptions in its immediate neighbours and Asia as a whole.

Recently, Professor Tony Milner from the University of Melbourne pointed out that Southeast Asia is a powerhouse region, with more than 600 million people spread across 11 countries, which as a bloc is one of the largest economies in the world. Milner goes on to warn that by procrastinating on the building of stronger economic and political ties in Southeast Asia, Australia is missing out on big economic, political and cultural benefits. These sentiments are not new and formed a core of the White Paper commissioned by the Julia Gillard government in 2011.

Trump’s transactional approach to foreign policy endangers credibility — and while Australia may see itself as a reliable partner, it does not mean the US sees Australia as a strategic need. In this context, the Indo-Pacific strategy — clearly one to contain China — that limits trade with a leading partner, fuelling a regional arms race, while chain-ganging to an ally already signalling vacillation on its commitments, appears counter-productive to Australia’s objective interests.

With the erosion of international law and human rights standards in the ongoing support for the war in Gaza, the norms of international behaviour that Australia is accustomed to are being quickly undone — by its own hands.

Concerns are mounting also about the domestic conditions in Australia’s allies. The deterioration of key indicators of economic and societal well-being within the US are alarming. Indicatively, life expectancy has been on a downward trajectory, and the US is grappling with the spectre of low GDP growth (1.9% in 2022; 2.5% in 2023); high foreign-owned debt; elevated unemployment; diminishing business and consumer confidence; and its national health and education systems are under considerable strain. Democracy is facing severe challenges, with the power of elites and polarisation eroding faith in the electoral process and the nation’s stability.

Across the Atlantic, the UK is grappling with analogous economic challenges. High foreign debt; meagre GDP growth (at 0.3% in 2023); soaring inflation (peaking at 11% in October 2022); and elevated unemployment paint a grim picture. The UK’s post-Brexit trajectory has raised ethical and economic concerns, particularly regarding the treatment of asylum seekers. The resurgence of far-right political parties challenges values of tolerance and inclusivity, prompting questions about the UK’s dedication to democratic principles as well.

Rather than remaining tethered solely to the US and UK, Australia should reflect on how it could enhance collaborations with regional nations exhibiting more promising trajectories.

Looking first at the more self-interested benefits that could stem from regional collaborations, the economic advantages of pivoting to Asia are increasing. In 2023, Australia’s two-way trade with Asean nations amounted to US$183.4 billion — far greater than Australia’s two-way trade with the US or the European Union. The real GDP growth of countries including India, Indonesia and the Philippines are all over 5%. Malaysia rebounded at 8.65% in 2022 from Covid-19. China continues to grow with its consistently rising GDP. Estimates suggest that Asian nations will lead world GDP by 2050, with three economies in the top five: China (first), India (second) and Indonesia (fourth).

The speed of infrastructure development in the region is almost mind-boggling, from Indonesia shifting its capital to Nusantara and the development of its first high-speed rail, while slower than planned, shows confidence in its developmental potential. Similarly, from its first high-speed rail in 2008, China now has over 42,000km of operational high-speed rail, far surpassing any other country in network size or ridership. It achieved this in less than 16 years.

Many Asian nations can now boast rising middle classes, youthful demographics, and increasing education levels. These factors create fertile ground for economic and social progress, highlighting the potential for fruitful partnerships. The geographical proximity of these nations could facilitate stronger and more reliable supply chains and more importantly, create business opportunities for Australia. A report prepared by the Australian Lowey Institute suggests Australia should move away from exporting raw materials to developing advanced industries that use these natural resources.

But it is on the political side of this relationship that is most promising — and something rarely discussed. Across many states in Asia-Pacific is a strong commitment to multilateralism, the key institution so relentlessly undermined internationally today. Yet it remains a fundamental normative commitment in the region, especially, its greater powers including China and Japan. Multilateralism is also a cornerstone of other states’ commitments to neutrality and partnership such as Malaysia’s regional diplomacy, Vietnam’s diversified partnerships approach, even South Korea’s middle-power diplomacy by which it uses multilateral engagement to enhance its economic and security needs.

While the US has tried and failed with its unilateral Trans-Pacific “partnerships”, under-realised potential already resides in the forms of regional multilateralism across Asia-Pacific. For example, China’s National Institute of International Strategy analyst Jie Zhang has shown how in the midst of this great power competition between US and China, Asean has “showcased” considerable strategic autonomy and initiative, including launching a new non-aligned movement and pushing multipolarity.

A coalition of multilateral states would not need to replicate EU-like structures or even focus on internal normative questions that ring increasingly hollow in the West. Many Asian countries have a deep-rooted sense of sovereignty and are rightfully hesitant to cede decision-making to a supranational body. Instead, focusing on multilateralism would not only catalyse the economic advantages and technological capabilities but enhance the close ties of the region to counterbalance any attempted unilateral power plays.

Australia and its Asian partners could collectively amplify their political influence globally. Rather than being overshadowed by agendas external to the region, building towards a coalition of states committed to multilateralism could advocate for such shared principles related to dialogue, consensus, and inclusion.

Coordinating multilateral and trading resources will amplify the impact of delivering public goods demanded by the region — and build upon what we know already of middle-powers in the region whose interests converge on maritime behaviour, adherence to international law, and investment in regional institutions.

Of course, a region embracing all its parts will not be easy but offering inclusive, equal institutionalisation of all regional members would foster positive externalities of long-term stability between them. It is worth the strategic investment.

Ferdinand A Gul is Professor of Accounting and Finance, University of Sunshine Coast, Queensland, former Maybank Chair, Faculty of Economics and Administration, University of Malaya, and former Distinguished Research Professor, Sunway University, Malaysia. Shannon Brincat is senior lecturer in Politics and International Studies, University of Sunshine Coast, Queensland.

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