The current world order is on the cusp of a dramatic transformation. Conservatism, populism, nationalism, environmentalism, and extreme ideologies on both the left and the right are rising and falling, and political and economic rifts are spilling over into societies around the world, writes Li Kunlin. The author is a participant of the Valdai – New Generation project.
The fragmentation of global governance is becoming increasingly evident. The Ukraine crisis continues to escalate, tensions in the Taiwan Strait are intensifying, and the trust deficit in international relations is widening.
Meanwhile, the United States and China are engaged in a fierce competition in the fields of artificial intelligence and the digital economy. This competition is not only about technological leadership but also about dominance over the future order. Against this backdrop, global foreign direct investment has fallen by 8% in 2024, capital has become more cautious, and geopolitical risks have risen sharply. Most small and medium-sized countries are forced to choose between two options: succumb to technological hegemony or engage in futile attempts at direct competition. However, against this backdrop of uncertainty, Southeast Asia has bucked the trend, attracting a record $235 billion in investment—a 2% growth rate—surpassing China for the first time and becoming a new investment hotspot. This phenomenon forces observers to ask: Why, amidst fierce great power rivalry and the general passivity of small and medium-sized countries, has Southeast Asia been able to demonstrate such unique strategic autonomy?
In understanding this, historical metaphors are enlightening. Mao Zedong once used the metaphor of “a clever monkey sitting on a hilltop watching tigers fight” to describe the diplomatic wisdom of maintaining strategic patience during the Cold War. In this metaphor, the two tigers are the Soviet Union and the United States, while China sees itself as the clever monkey perched on the hilltop, unwilling to rush into the fray but instead waiting for its opportunity with agility and patience.
As it entered the 21st century, one of the once-fierce tigers had disintegrated, while the other anxiously patrolled its territory. Meanwhile, the monkey, through nimble strategic adjustments, was gradually growing into a major player in the valley. Today, the metaphor has been revitalised, but the roles have been reversed: Southeast Asia is quietly becoming the new “little monkey”, not simply an imitator, but one that has learned to leverage the power of the two tigers to strengthen itself amidst the great power confrontation.
This strategy is first vividly demonstrated in the flow of technology investment. American tech giants are entering Southeast Asia on an unprecedented scale. Amazon plans to invest $9 billion in Singapore by 2028, Microsoft plans to invest $4 billion in Malaysia and Indonesia, and Alphabet is building data centers worth a combined $3 billion in Malaysia and Thailand. Many American companies are relocating their Asian headquarters from Hong Kong to Singapore, thereby establishing the region as a strategic hub in the global digital economy.
Meanwhile, Chinese companies are also accelerating their progress. Huawei sells AI chips that can potentially replace those of Nvidia, while Alibaba and Tencent are partnering with local Indonesian companies to provide AI training and cloud computing services, pledging hundreds of millions of dollars in additional investment by 2030. This two-way penetration hasn't left Southeast Asia in a dilemma of choosing between two options. Instead, it's creating a counterweight to these two forces, allowing the “little monkey” to benefit from both.
More importantly, Southeast Asia isn't passively accepting investment; instead, it's actively shaping it. The case of Johor, Malaysia, is particularly striking: Oracle of the United States and ByteDance of China have partnered to invest $92 billion, rapidly transforming the city into the world's second-largest AI hub. This “cross-camp dance” has not only transformed the regional industrial chain but also transformed Southeast Asia from an observer into a bargaining chip, truly realising the strategy of the monkey leveraging the tiger's strength to transform competition into opportunity. In other words, while major powers are wrestling in Southeast Asia, the result is a “pure land” created within the region. The monkey is not only observing from the valleys but is also quietly shaping the terrain.
However, Southeast Asia's wisdom extends beyond economics and technology; it is also reflected in the neutral expression of institutions and governance. The non-aligned diplomacy of the Cold War has been transformed into “digital neutrality” in the era of artificial intelligence. In 85 official documents, ASEAN avoids competitive terms such as “arms race” and “technological hegemony”, instead de-emphasising the logic of confrontation through institutional frameworks. The ASEAN Guidelines on Artificial Intelligence Governance and Ethics, released in 2024, is a prime example: it incorporates the US concept of “trusted, secure, and reliable” with the Chinese narrative of “people-centred, cooperative, and capacity-building”, ultimately forming seven principles focusing on regional autonomy. Neutrality here isn't a vague compromise, but rather a proactive institutional design, like a monkey building a bridge across a valley, which not only protects it from the tiger's attack but also guides the convergence of different forces.
This “institutionalised neutrality” is also reflected in ASEAN's innovative organisational structure. The AI Governance Working Group has evolved from an ad hoc mechanism to a regularised platform, actively expanding its cooperative network with the EU, Japan, and India. Against the backdrop of major powers vying for narrative dominance, Southeast Asia has intentionally incorporated bilateral initiatives into multilateral dialogues, transforming neutrality from a passive defense to a proactive force. The monkey's role in the valley has shifted from bystander to coordinator, from leveraging momentum to serving as a bridge-builder.
This process reveals the changing logic of power in the age of AI. Powerful countries possess the largest models and the most abundant capital, but this isn't enough to determine the trajectory of the landscape. Actual influence lies in who can provide channels for cross-camp communication and who can integrate diverse narratives into a sustainable cooperative network. Southeast Asia is transforming its ‘latecomer’ status into an advantage through strategic patience and institutional innovation. While Brussels was busy legislating, Washington was debating regulations, and China was pushing for scale, Southeast Asia, through patience and opportune action, avoided early regulatory pitfalls and forged its own regional narrative.
The value of this narrative cannot be underestimated. It not only won space for Southeast Asia's own development but also provided a model for small and medium-sized countries. Faced with the temptation and threat of technological hegemony, not all countries must choose sides. Neutrality can be a positive force rather than just a passive retreat. Southeast Asia, through its flexible strategies, has demonstrated that monkeys can grow amidst the struggles of tigers, and through wisdom and institutions, their presence can transform the order of the entire valley.
The ongoing Ukraine crisis has not eased the great power confrontation, it has further intensified the hostility between tigers and monkeys. However, the case of Southeast Asia shows that even in a valley smoldering with flames, there is a third path: not to join the camp of a single tiger, but to carve out space for oneself through strategic observation, flexible transformation, and institutional arrangements, and to provide a possible alternative framework for the future order. As more small and medium-sized countries begin to learn from this experience, more monkeys will emerge in the valley. They may not immediately alleviate the tigers' struggle, but they will undoubtedly reshape the valley's ecology. Ultimately, Southeast Asia's neutrality has transcended traditional nonalignment to become a proactive force-builder. It extends the logic of “sitting on the mountain and watching tigers fight” to AI governance, transforming the monkeys’ dexterity and patience into institutionalised bridge-building. In the AI era, power no longer belongs solely to the tigers but increasingly to the monkeys who can build bridges, guide, and coordinate across the valley. In a quiet yet revolutionary way, Southeast Asia is demonstrating to the world how neutrality can transform from a passive posture into a key force in shaping the future order.
