Janice R. Andrews
As Malaysia takes on the chairmanship of the Association of Southeast Asian Nations (Asean) in 2025, Prime Minister Anwar Ibrahim faces a complex landscape of regional and global challenges. From rising trade tensions linked to Donald Trump’s return and his aggressive tariff policies to regional crises such as Myanmar’s ongoing civil war and disputes in the South China Sea, Malaysia’s leadership will test Anwar’s diplomatic capabilities.
A Defining Moment for Anwar Ibrahim
For Anwar, 77, this role marks a significant milestone in his illustrious career. Since taking office in late 2022, he has worked tirelessly to restore Malaysia’s global standing after years of political instability. Anwar’s proactive international engagement—including visits to the US, China, India, and other key nations—reflects his readiness to address critical global and regional challenges. As Asean chair, Malaysia is uniquely positioned to influence discussions on trade, security, and diplomacy.
The Strategic Importance of Asean
Asean, the world’s fifth-largest economy, boasts a combined GDP of $3.6 trillion and a growth rate of 4.5% in 2024. However, its reliance on consensus-based decision-making often limits its ability to act decisively, earning it criticism as a “talking shop.” Malaysia’s chairmanship will be closely watched for its ability to address these limitations and navigate pressing issues.
Trump, Tariffs, and Trade Challenges
The anticipated return of Donald Trump as US president adds volatility to global trade. Trump’s promise to impose broad tariffs on imports, including goods from Asean nations, could disrupt regional economies. During his previous term, Southeast Asia benefited from the US-China trade war as manufacturers relocated to the region. However, the new tariff policies may target Asean as a whole, threatening these gains.
Despite these challenges, opportunities remain. China’s leadership in green technology, especially if the US scales back its environmental commitments, offers Asean a chance to strengthen economic ties with Beijing. Additionally, the US remains the largest source of foreign direct investment in Asean, contributing $476.3 billion in 2023. Malaysia, under Anwar’s leadership, has been a major recipient of these investments, particularly from American tech giants like Amazon and Microsoft.
Myanmar: Asean’s Most Pressing Crisis
Myanmar’s civil war, nearly four years after the military junta’s coup, remains Asean’s most critical internal issue. The conflict has triggered a surge in human trafficking, drug smuggling, and a refugee crisis that has burdened neighboring countries, including Malaysia, Thailand, and Indonesia.
Malaysia has taken a firm stance on Myanmar. In 2022, it was the first Asean nation to engage with Myanmar’s civilian National Unity Government. As Asean’s chair, Malaysia is expected to push for stronger action, though the appointment of former Thai Prime Minister Thaksin Shinawatra as a personal adviser has raised concerns about a potentially softer approach toward the junta.
Navigating the South China Sea Disputes
Territorial disputes in the South China Sea pose another major challenge. China’s assertive claims have divided Asean members. While Vietnam and the Philippines oppose Beijing’s actions, others, such as Cambodia and Laos, prefer to avoid confrontation with their largest trading partner.
Malaysia has maintained a balanced approach, fostering strong ties with China while resisting its territorial encroachments. As chair, Malaysia will prioritize efforts to finalize a long-awaited code of conduct for the South China Sea. However, progress has been slow, reflecting the difficulty of achieving consensus on such a contentious issue.
Strengthening Asean’s Global Influence
Anwar has consistently highlighted Asean’s potential as a global player. Malaysia’s growing ties with the BRICS coalition—comprising Brazil, Russia, India, China, and South Africa—demonstrate its intent to expand its economic and strategic networks. Balancing these relationships with alliances in the West, however, will require careful diplomacy.
The Road Ahead
Malaysia’s leadership of Asean comes at a critical time. The region’s ability to maintain cohesion and relevance on the global stage will depend on its capacity to address trade disputes, internal conflicts, and geopolitical tensions. Anwar’s extensive international connections and diplomatic skills will be key to navigating these challenges.
Ultimately, Malaysia’s chairmanship is an opportunity to prove that Asean can move beyond its reputation as a “talking shop” and take meaningful action on the issues that matter most to the region and the world.
