EU Indo-Pacific Strategy Under the Shadow of the AUKUS

This article is part of a series of articles authored by young, aspiring China scholars under the Future CHOICE initiative.

The unveiling of the long-awaited Indo-Pacific strategy by EU foreign policy chief Josep Borrell was a very short lived triumph. Stealing the spotlight, the new trilateral security arrangement between the US, UK, and Australia under the collective name of AUKUS quickly overshadowed the strategy.

Much to the consternation of the affected parties, the new defense pact risks marginalizing the EU’s role in the region and undermining “ASEAN Centrality”.  In order to counteract these power shifts, the EU and ASEAN should strengthen cooperation to avoid being relegated to the role of onlookers in the ongoing geopolitical struggle.

Building the EU Subjectivity in the Indo-Pacific

The crucial role of the Indo-Pacific region in global geopolitics is now nearly universally appreciated. 

The region includes six members of the G20 as well as the entirety of the increasingly important ASEAN group. Some 60 percent of maritime trade passes through this region, which is the source of 40 percent of global GDP. Moreover, it is highly interconnected with the EU, with about 40 percent of the EU’s foreign trade transiting the South China Sea, alongside 70 percent of global trade in goods and services between the bloc and the region.

Given these statistics, the crucial role of the Indo-Pacific is most definitely not lost on the EU. The new, 18-page EU strategy for cooperation in the Indo-Pacific covers a range of actions and points out seven priority areas: sustainable and inclusive prosperity, green transition, ocean governance, digital governance and partnerships, connectivity, security and defense, and human security. 

The document clearly emphasizes the interest in a long-term engagement in the region, signaling the willingness to bolster the EU’s status as an independent actor in the Indo-Pacific. This is especially paramount for countries in the region that do not want to be part of the Sino-American rivalry. In this context, the EU’s vision may be seen as a preferable alternative. 

Hence, a very important component of the EU strategy is the development of economic cooperation. The document expects completion of trade negotiations with Australia, Indonesia and New Zealand as well as resumption of trade negotiations with India. In addition, an assessment will be made of the possible resumption of trade negotiations with Malaysia, the Philippines and Thailand, and the eventual negotiation of a region-to-region trade agreement with ASEAN.

When it comes to security issues, particularly noteworthy is the rise of intense competition and significant military build-up among numerous nations. Although attention is paid to the entire Indo-Pacific region, China is the only country directly mentioned. This can be read as a nod to the countries that expect to adopt a stark posture in a bid to counter growing Chinese assertiveness, especially to put more pressure on China’s contested claims in the South China Sea and other maritime theaters. 

France Takes the Lead in the Indo-Pacific

European involvement in the Indo-Pacific region is not a top-down initiative, with the EU as a forerunner. The interest in the new concept and the idea of greater involvement in this region first came from the Member States, with a key role played by France.

During his visit to Australia in May 2018, President Emmanuel Macron outlined France’s strategy for the Indo-Pacific in a speech given at the Garden Island naval base in Sydney. Macron emphasized the importance of a new strategic alliance between France, Australia, and India, seeking to respond to challenges in the region and China’s growing assertiveness. One of the key elements of strengthening relations between countries was a $38 billion deal to build 12 conventionally powered submarines based on Barracuda nuclear-powered subs in development. 

France’s interest in the region is almost self-explanatory given its history in the Indo-Pacific. It has territories in both oceans with 1.6 million citizens as well as 8,000 soldiers stationed in the area. In addition, more than 90 percent of France’s Exclusive Economic Zone is located in the Indian or Pacific oceans. Therefore, it should come as no surprise that in 2019 the French Ministry for the Armed Forces published France’s Defense Strategy in the Indo-Pacific, and the Ministry for Europe and Foreign Affairs published The French Strategy in the Indo-Pacific. France also expressed its willingness to play a military role, as manifested by the patrol by the nuclear attack submarine SNA Emeraude, along with the support ship BSAM Seine, in February 2021.

France is not the only EU state interested in the region either. 

In September 2020, the German government released a document entitled Policy guidelines for the Indo-Pacific region. Like France, the German government also decided to play a more significant role in the security domain in the region. Thus the “Bayern” (Bavaria) warship was deployed in August this year to the Indo-Pacific for a six-month mission, including passing through the South China Sea. Finally, the Netherlands has also been developing its own vision of the Indo-Pacific.

AUKUS and Excluded Partners

Considering the fact that both France and Germany actively participated in the promotion of freedom of navigation and rules-based order in Indo-Pacific, engaging their navies for this purpose, the new defense pact has increased tensions in transatlantic relations and undermined the position of the Franco-German tandem, and thus the entire EU when it comes to the Indo-Pacific region.

Canberra’s move hit France directly and indirectly. The most immediate impact was that of France losing its multi-billion-dollar submarine agreement with Australia, which is connected with the threat of losing thousands of jobs and serious image damage internationally.

In a more strategic context, France’s position in the region, for which it has worked intensively for over a decade, has been seriously undermined. Paris was understandably furious, with Foreign Minister Jean-Yves Le Drian describing this arrangement as a “stab in the back”. While the tensions have eased somewhat in the meantime and  France agreed to send its ambassador back to Washington, the fallout will be felt for a long time.

Considering France’s position in the EU, it can be assumed that Washington’s decision to create AUKUS in this form is to send a strong message to Brussels, whose approach to China has recently been ambiguous, to say the least. This can be best evidenced by the hasty completion of negotiations on the Comprehensive Agreement on Investment (CAI) with China at the end of 2020. With the EU apparently resolved to remain sitting on the fence in the developing rivalry with China, Washington opted to proceed with more willing partners. 

Intraregional Perspective from ASEAN

However, the EU is not the only actor to consider. ASEAN offers a different perspective on the AUKUS developments. 

The escalating rivalry between the US and China in the Indo-Pacific makes every American initiative, especially of a security nature, the subject of careful attention from Southeast Asian states. The circumstances and outcomes of the announcement of AUKUS made the EU a perfect partner for ASEAN, enabling both organizations to develop their strategic position.

According to the latest opinion poll conducted among Southeast Asian citizens by Singapore’s ISEAS-Yusof Ishak Institute, the EU is the clear front-runner for ASEAN in its strategic hedging game. Most respondents (40.8 percent) choose the EU as a preferable ASEAN partner, able to support the region in the face of Sino-American rivalry.

Given the reaction of some ASEAN member states to the announcement of AUKUS, the association’s relationship with the EU could gain even more value. The trilateral agreement, especially the submarine section, received a cautious reception from Malaysia and Indonesia. 

Despite the fact that the Australian submarines are not set to be equipped with nuclear weapons, Malaysian Prime Minister Ismail Sabri Yaakob pointed out to his Australian counterpart that “AUKUS could potentially be a catalyst towards a nuclear arms race in the Indo-Pacific region, as well as provoke other powers to act more aggressively, especially within the South China Sea region”. Furthermore, the Indonesian Ministry of Foreign Affairs stressed in the official statement “the importance of Australia’s commitment to continue meeting all of its nuclear non-proliferation obligations”. 

Even though other ASEAN countries such as Singapore and the Philippines welcome establishing the new enhanced trilateral security partnership because it might help deter Chinese military action, it still comes with concerns regarding Beijing’s long-term response to the AUKUS. According to Nguyen Ngoc Truong, a former Vietnamese diplomat, “Beijing may become even more aggressive” as a result of the new security pact.

Minilateralism over Multilateralism

Taking a broader view, the Biden administration consistently shows that it prefers to coordinate its activities in smaller formats such as QUAD or AUKUS rather than broadly multilaterally. Such an approach undoubtedly has advantages as it allows for greater flexibility and quicker response to unexpected or urgent challenges. 

Brussels’ agreement on the CAI with China has made the US realize that the actions of the EU can be unpredictable and, most importantly, are beyond the full control of the White House. On the flipside, ASEAN is usually seen as an organization limited to a ‘talk shop’ due to its consensus-based decision-making. The question of China’s influence, resulting from strong economic dependence, also looms large. 

At the same time, minilateral formats like AUKUS, without considering any of the EU members, may intensify antagonisms on the Brussels-White House line, driven by a sense of subordination or being sidelined. Similarly, ASEAN fears that its centrality in the Indo-Pacific region in terms of multilateral cooperation will be rendered meaningless by another minilateral grouping such as AUKUS or QUAD.

In short both the EU and ASEAN face a similar challenge in terms of their marginalized role in the Indo-Pacific region. As such, both are likely to counteract this by bolstering bilateral relations, which, on the one hand, will contribute to their mutual development by breaking economic dependence on China and, on the other hand, enhance their position as individual actors in the region. 

Keeping the EU and ASEAN as mere onlookers is not in the US interest either. At the expense of increasing mobility and decision-making in minilateral formats, the US may ignite anti-American sentiments in Europe and Southeast Asia, and eventually undermine its goal to create a broad coalition to counter China.