The Asian Century is upon us with China as its visionary leader. That will be the message Beijing will hope to drive home when it hosts the Asia-Pacific Economic Cooperation (APEC) summit on 18 to 19 November.
The summit is billed as a forum to address ‘building an Asia-Pacific community to prosper together’. But it will take place as the world’s most populous region grapples with challenges of energy insecurity, supply chain disruption, AI governance, and technological upheaval – and as growing geopolitical tensions are causing the realignment of international partnerships.
Beijing has not shied away from promoting itself as champion of the Global South. But for Indo-Pacific economies seeking a partner to build consensus and tackle the region’s most pressing challenges, the momentum may well be with Japan.
Low expectations
China’s history of lifting its people out of poverty at breathtaking speed has been nothing short of remarkable. Nevertheless, there is a trust deficit across the Indo-Pacific, where Beijing has established itself as the undisputed regional hegemon.
Its vision for growth, as outlined in in its latest Five-Year Plan, seeks to make China the global leader in advanced technology by 2030. But there are concerns among regional countries that this will mean Beijing further exploits its dominance and exacerbates global economic warfare.
Meanwhile expectations for gatherings such as APEC, and the ASEAN summit in the Philippines preceding it, are low. The possibility of a display of unity, let alone a collective action plan, seems remote, especially as China will continue to leverage its chokeholds on the global economy. Instead, more attention will be paid to meetings on the sidelines of the summits, including a likely trilateral between Presidents Donald Trump, Xi Jinping, and Vladimir Putin.
Those talks are expected to focus on the Iran war and denuclearization. A breakthrough on the war would be greatly welcomed, given the economic pain caused by the resulting higher energy costs: Southeast and South Asian countries including Vietnam have been hard hit. But the underlying concern for regional countries will be that shifting relations between the US, China and Russia could further aggravate their existing challenges.
China will remain an indispensable relationship for all countries in the region. But it is Japan that may hold the key to a collaborative path to address the Indo-Pacific’s challenges – one that might allow the region to continue its upward economic trajectory.
An evolving strategy
There are three main reasons that Japan could play a key role as a driver of collaboration in the region.
First, Tokyo’s Free and Open Indo-Pacific (FOIP) strategy has evolved to meet the new strategic reality. Originally FOIP championed a rules-based order, quickly becoming the foundation for the Indo-Pacific strategies of governments including the US and European Union. Its weakness, though, was the reluctance of South and Southeast Asian nations to embrace it. That, and the geopolitical reality of weakening commitment to a rules-based international order.
Tokyo has responded by developing the strategy around a pragmatic, results-oriented approach. In her May 2026 speech before the Vietnam National University, Japanese Prime Minister Sanae Takaichi again stressed the need for a rules-based economic order. But she also set out how Japan intends to update the FOIP to reflect the immediate, practical needs of Vietnam and other countries across the Indo-Pacific.
That includes initiatives to build economic infrastructure ‘for the age of AI’, such as underwater sea cables and satellite communications, creating a ‘FOIP digital corridor’. It also means enhancing energy security for the long term, as outlined by the $10 billion Partnership on Wide Energy and Resource Resilience Asia (POWERR Asia), which Tokyo is expanding as it collaborates with the World Bank to advance regional energy resilience.
And it means boosting regional cooperation on artificial intelligence through an ASEAN-Japan Co-Creation Initiative for AI.
A trusted partner
Second, Japan has emerged as one of the most trusted and politically stable countries in the Indo-Pacific. In the latest State of Southeast Asia survey, Japan is ranked the most trusted major power by respondents in the 10 ASEAN nations for the eighth consecutive year. Nearly 66 per cent of respondents regard Japan as a responsible stakeholder that would do the right thing for global peace and prosperity. That puts it in a position to operate as a regional consensus-builder that can bring forward a roadmap for regional growth.
Granted, Tokyo has no interest in becoming a ‘superpower of the middle powers’. But it continues to embrace taking on a greater role in an increasingly unstable region that is facing growing economic risks. And it has shown an ability to overcome significant tensions and focus on results, for instance through its improved relations with Seoul – where pragmatism has generally prevailed as both Japan and South Korea have sought to cooperate over economic concerns, the increasing unpredictability of US policy, and shared regional security threats like North Korea.
Third, Japan has been committed to ensuring continued US engagement in the Indo-Pacific, including on trade. There has been growing discontent in the region about the economic damage caused by US foreign policy decisions, from tariffs to the war with Iran. But Tokyo has been resolute in promoting frameworks that would encourage the US to regain its position as a trusted economic power once again.
Granted, the likelihood of the US joining a multilateral trade framework such as the CPTPP is highly unlikely, even after a new Congress is sworn in under Democratic control. But the US remains the only country that has the advanced technology and financial capital to compete head-on with China. And Washington will remain a critical partner for economic security in the Indo-Pacific moving forward.
Japan cannot single-handedly reconcile the Indo-Pacific’s divergent interests, and there is domestic political debate about to what extent Japan should take on a leadership role, given its own fiscal constraints. It clearly cannot match China’s economic heft nor the technological and financial firepower of the US. Moreover, the trust that it enjoys in Southeast Asia does not necessarily translate into becoming a leader. Yet that may be to its advantage as the Indo-Pacific navigates the shifting global order and adopting to new geopolitical realities.
What Tokyo offers is a partner that delivers tangible results without demanding allegiance in return. Japan is positioning itself not as a regional leader, but as the convener the Indo-Pacific increasingly needs.