This publication is a product of Carnegie China. For more work by Carnegie China, click here.

Balancing priorities, possibilities, precarities, and personalities has long been the essence of ASEAN’s modus operandi in managing great powers. But it has not had to deal with all these variables at the same time under intense pressure in a long while. In line with its chairmanship’s theme of “Inclusivity and Sustainability,” Malaysia’s leadership of ASEAN pushed for intra-regional reform while deepening traditional ties and cultivating new ones.   

US Gets Pomp, China Gets Serious about Nuclear and Trade  

Even as Malaysia deepened cooperation with traditional partners such as Australia, China, Japan, and New Zealand, it nonetheless rolled out the red carpet for US President Donald Trump, dispatching fighter jets to escort Air Force One into Malaysian airspace. But as soon as the pomp and circumstance surrounding Trump was over, Malaysia turned to handling Asia-Pacific’s other behemoth, China.  

This isn’t ASEAN and China’s first rodeo, having met 28 times in these summits and covering a wide gamut of issues from trade and technology to online scams and climate change. The latest 12-page ASEAN chair’s statement included verbiage on a number of existing issues from the code of conduct in the South China Sea to the occupied Palestinian territories—the chair’s symbolic but adamant acknowledgment of the importance of international law in a broken global order. More significantly, Malaysia notched a win by getting China’s word to sign and ratify the Treaty on the Southeast Asia Nuclear Weapon-Free Zone (SEANWFZ) without reservations.  

Although China gave its verbal commitment at the ASEAN Foreign Ministers Meeting in May, when China formally ratifies this treaty remains a question. But the fact that China even pledged to do so was both symbolically significant and strategically savvy. It allows China to stake a moral high ground on nuclear governance while other nuclear weapon states continue to dither. In particular, this action makes China appear as a responsible leader in the region, especially when no other nuclear weapon state has signed onto SEANWFZ since its adoption in 1995.  

Economic Progress and Predictability  

Another key outcome of the summit was the upgrade of the 25-year ASEAN-China free trade area (ACFTA) arrangement, the second upgrade in a decade, that includes new commitments in green and digital economies as well as supply chain connectivity. This was a natural progression for the two parties, which have been each other’s largest trading partners for years. The economic dimension of bilateral ties is, needless to say, central. 

Negotiations for this upgrade, known as the ACFTA 3.0 Upgrade Protocol, began in 2022 and concluded in May 2025 amid the trade war the United States launched against the world. Juxtaposed against the unpredictability of the United States that now prefers punitive trade instead of free trade, Malaysia cast the ACFTA 3.0 Upgrade Protocol as providing “a reliable, predictable, and stable business environment, especially amid the current geoeconomic challenges”. Indeed, ASEAN countries have been targets of the Trump administration’s tariffs, some as high as 49 percent on “Liberation Day”. Even Singapore, which has an FTA and a trade deficit with the United States, has not been spared the 10% baseline tariff.   

An ASEAN + Rest of World (ROW) Strategy  

What is quietly understood but not officially articulated is that ASEAN’s ability to mitigate external shocks in the longer term lies, in part, in proactively diversifying its engagement and developing coordinated regional strategies.  

Toward that end, at the ASEAN Summit, Malaysia and Indonesia, co-chairs of the ASEAN Geoeconomics Task Force (AGTF), presented the first-ever ASEAN geoeconomics report as the basis for the inaugural joint convening of ASEAN foreign and economic ministers. Formally recognizing that economics can no longer be separated from political or security matters, this joint meeting underscored the reality that ASEAN needs to proactively respond to these new dynamics and align across the grouping’s traditional pillars and sectors.  

Malaysia also aimed to play a larger role in multilateral convening. In May, it hosted the ASEAN-Gulf Cooperation Council (GCC)-China Summit. The joint statement harkened back to “the long-lasting and deeply rooted historical and civilizational linkage and economic ties among ASEAN, GCC, and China” and outlined a shared commitment to multilateralism, free trade, and connectivity, among other pledges. 

This was an unusual gathering of partners for ASEAN, and naturally, it drew cynicism and criticism (on mostly procedural grounds). Yet it underlined ASEAN’s convening power to bring to the region two rising powerhouses to discuss shared priorities in an institutionalized, three-way conversation. While the trilateral may not survive in the long run, at a minimum, Malaysia merits commendation for expanding the grouping’s interactions to more diverse partners. After all, every relationship starts somewhere.  

Under the Malaysian chair, this year’s ASEAN summits drew a larger than usual leader representation. Brazilian President Luiz Inácio Lula da Silva and South African President Cyril Ramaphosa, for example, were present at the East Asia Summit. In fact, Brazil and South Africa have been ASEAN sectoral dialogue partners since 2022 and 2023, respectively. With Indonesia as a full BRICS member and Malaysia, Thailand, and Vietnam already serving as partner countries, deepening engagement among BRICS and ASEAN states was low-hanging fruit on the sidelines of the summit.  

Malaysia’s chairmanship sought to fend off short-term challenges while laying the groundwork for minimizing ASEAN’s longer-term exposure to external stresses. Whether ASEAN continues to strategically diversify its risk and partnership portfolio will depend on future chairs. At a minimum, the expanded ASEAN (now eleven member states with the addition of Timor-Leste) collectively recognizes that doing business as usual will no longer suffice simply because, as the AGTF itself concluded, the order of business is no longer usual.