I. Introduction

Since its official proposal in 2013, the Belt and Road Initiative (BRI) has been continuously deepened both in theory and in practice. The Southeast Asia region is not only the overseas starting point for China to implement the BRI but also an important area for China to carry out economic and trade cooperation and technological exchanges with neighboring countries. It is also a region that the United States has focused on managing after its “Pivot to Asia” strategy, especially after Trump took office. With the further deepening of U.S. strategic containment of China and the continuous intensification of the trade and technology war with China, the region has become increasingly apparent as an area in which the United States intends to strategically contain China’s peaceful development.

Since the Obama administration, U.S. policy towards China has evolved from engagement to a parallel development of limited contact and moderate containment, and then to high-intensity containment under strategic competition, with the new competitive and cooperative relationship between China and the United States constantly adjusting and changing. After Trump entered the White House, the U.S. government explicitly identified China as its strategic competitor in the form of a national strategy and used a series of methods in economy, security, and diplomacy to strengthen strategic competition against China.¹ In the field of technology, the U.S. attitude towards China has gradually shifted from a willingness to cooperate to actively initiating competitive containment. Since 2018, the administrations of the United States have launched trade protectionist actions against other countries through a series of acts. In cutting-edge technology fields, China’s three major telecommunications operators and communication service providers like Huawei and ZTE have been listed on the U.S. government’s controlled list, and the United States has banned TikTok from operating in its territory on the grounds of national security. Traditional technology fields have also been affected. For example, in the steel sector, the United States set trade barriers on a variety of steel and steel products from East Asia and Europe to protect its domestic companies. Among them, the United States conducted multiple 337 investigations, 232 investigations, and 301 investigations against Chinese steel companies and related industries to impose anti-dumping duties and countervailing duties on Chinese steel products. These actions were seen by academia at the time as key measures in U.S. trade frictions with China.

In bilateral competition with China, the United States, on the one hand, has set investment barriers, trade barriers, and technology exchange barriers against China, showing signs of decoupling to a certain extent. On the other hand, it has tried to cut off China’s high-tech import sources by building industry and technology alliances with other countries that exclude China. In response to United States technological containment, China, on the one hand, has vigorously developed independent innovation and supported national technology companies to quickly get rid of asymmetric dependence on the West in technology. On the other hand, it seeks consensus on technological cooperation with other developed countries, expands the intersection of interests in technological interactions, and achieves technological exchange with developed countries. Moreover, China has realized the landing of Chinese technology overseas by deepening technological exchanges with many developing countries in Asia, Africa, and Latin America. In this process, the BRI has provided a platform guarantee and guiding ideas for China to carry out technological cooperation with relevant countries. Although the purpose of China’s proposal of the BRI is to create more opportunities for joint development based on the principle of consultation and construction, rather than a competitive mechanism against a third party, it is undeniable that the successful practice of the BRI has a direct and realistic effect on China’s response to United States technological containment.

II. The Belt and Road Initiative and Responding to United States Technological Containment

The Southeast Asia region is not only the pioneering area for the construction of the Maritime Silk Road under China’s Belt and Road Initiative (BRI) but also a key region for China to achieve industrial and technological transfer and to break through the strategic containment by the United States.² The entire Asia-Pacific region, including Southeast Asia, is the most active area for global economic development, with an estimated economic growth rate of 4.6% in 2023, contributing to 70% of global economic growth.³ Most ASEAN countries are in the early or middle stages of industrialization, with relatively small economies and immature basic industries, requiring the introduction of foreign capital and technology to develop their national industrial and technological systems. The region has several non-governmental organizations as well as bilateral and multilateral cooperation mechanisms, which can provide policy and financing support for technology-advanced countries to transfer technology to technologically lagging countries within the region.

During the Obama administration, the U.S. strategy towards China was mainly focused on engagement policies. President Obama pointed out that the was not proposed to target China, and maintaining contact with China was an important pillar for implementing the policy.⁴ During this period, although the United States government held reservations about participating in the BRI, it did not completely adopt measures to boycott it. After Trump took office, defining China as a strategic competitor, the United States began to adopt tough measures against China in the economic and technological fields, pressing China even at the cost of a zero-sum game and creating mechanisms to counter the BRI in both government and civilian sectors, causing great damage to China-United States relations. Although Biden, Trump’s successor, publicly declared China as the most challenging competitor for the United States,⁵ changes in the international situation and the dynamics of interaction between China and the United States forced the Biden administration to readjust its competition strategy with China. Specifically, the Biden administration’s macro-level adjustments mainly include three aspects: first, the United States began to focus on enhancing its overall competitiveness; second, it emphasized the role of allies and multilateral mechanisms; and last, it did not exclude cooperation with China in specific areas.⁶

In December 2017, the United States government released the National Security Strategy report, introducing the strategic concept of the “Indo-Pacific region,” pointing out that the United States intends to use political, economic, and security means to diminish China’s increasing influence in the region, thereby maintaining a regional balance favorable to the United States.⁷ With the intensification of competition against China, the Indo-Pacific Strategy gradually became an important platform for the United States to counter the BRI at the national strategic level.⁸ Wei Zongyou pointed out that the root of the shift in the United States’ strategy towards China from engagement to containment lies in the United States’ anxiety about its status as the leader of the international system, with concerns about China challenging the United States’ technological advantage being one source of this anxiety.⁹ Although Trump and Biden belong to the Republican and Democratic parties, respectively, and their strategies on some domestic and foreign policy aspects are not the same or even opposite, the directional strategic level of balancing China and conducting multi-dimensional competition against China has not changed with the change of ruling parties in the United States but has intensified. These strategies against China, although deployed in different fields, echo each other, continuously completing the United States’ strategic competition map against China. Their overall, cross-domain, and interconnected nature is concentrated in countering the BRI. Among them, the Indo-Pacific Strategy is the main means for the United States to counter and hedge against the BRI, with the Southeast Asia region being an important geopolitical direction to implement this goal.¹⁰

In the specific implementation process by the United States, it mainly presents as a “three-legged support for one cauldron” form. “One cauldron” refers to the Biden administration using multilateral mechanisms as the main unit to balance China, utilizing existing or newly established multilateral mechanisms to align the United States and its allies in technological containment against China. For example, existing international mechanisms led by the United States, such as the Quadrilateral Security Dialogue summit of leaders from the United States, Japan, Australia, and India, and the G7 summit. On March 12, 2021, the leaders of the United States, Japan, Australia, and India held a Quadrilateral Security Dialogue summit, declaring their intention to strengthen cooperation in response to COVID-19, climate change, cybersecurity, critical technologies, high-quality infrastructure investment, humanitarian aid, and disaster reduction. The so-called “three legs” are the three main aspects through which the Biden administration balances China at the technological level, which are also multilateral mechanisms and the three pillars on which this “cauldron” stands. In the process of technologically balancing China, the Trump administration focused on digital technology connectivity and cyberspace security, energy cooperation, and infrastructure construction. ¹¹ The Biden administration has continued the previous administration’s competitive stance in the infrastructure field and used new energy technologies as a means to improve its competitiveness, making semiconductor technology a “trump card” to contain China’s development in information communication and related industrial fields.

Due to the relatively wide range of technologies involved in infrastructure and the relatively low technical barriers, coupled with it being a key area for China to implement the BRI in practice with participating countries, it naturally becomes a focal area for the United States to target China. The main mechanisms the United States uses to compete with China in the infrastructure sector include the Millennium Challenge Corporation, the Blue Dot Network plan, the Build Back Better World initiative, and the new Global Infrastructure and Investment Partnership plan. The Millennium Challenge Corporation is a foreign aid agency established by the United States in 2004, aimed at providing time-bound loans to some developing countries to promote economic growth and reduce poverty. These investments are not only intended to help the target countries achieve prosperity and stability but also to enhance the national interests of the United States. In the infrastructure sector, the Millennium Challenge Corporation mainly involves agriculture, energy and power, and transportation infrastructure.¹² In April 2021, during a meeting with Japanese Prime Minister Yoshihide Suga, President Biden proposed a new global infrastructure investment plan led by what he referred to as “democratic countries,” intended to counter China’s BRI. ¹³ In June of the same year, the G7 launched the “Build Back Better World” partnership plan, aimed at meeting the infrastructure investment needs of developing economies. A month later, the U.S. government again utilized the platform of the Asia-Pacific Economic Cooperation (APEC), explicitly stating during an informal meeting that Washington would deeply participate in the economic activities of the Indo-Pacific region through the “Build Back Better World” plan, providing high-standard infrastructure construction projects that meet climate change requirements and transparent financing standards.¹⁴ The Biden administration proposed this plan based on both domestic policy and international strategic needs, with countering the BRI as the direct reason and primary goal for proposing the plan.¹⁵ The Build Back Better World plan is seen as the first real strategic measure proposed by the U.S. government to counter the BRI,¹⁶ but the implementation process of the plan has not been smooth. To reverse this situation and further achieve strategic containment of China, the Biden administration formally launched the Global Infrastructure and Investment Partnership plan at the G7 summit in June 2022, also planning in four priority pillar industries including infrastructure adapted to climate change, transition energy technology, and the development of a complete lifecycle of clean energy supply chains, as well as secure information and communication technology networks and infrastructure.¹⁷

The clean energy sector is one area the Biden administration is focusing on to boost U.S. global technological leadership, combined with China’s strong competitive edge in the new energy domain. Therefore, the U.S. is taking multiple measures to strengthen this effort: domestically, the Biden administration has concentrated on new energy vehicles and clean energy power generation projects, rolling out policies to encourage the localization of electric vehicle production, and in response to the weak state of new energy battery development, enacted policies and regulations such as the Infrastructure Investment and Jobs Act and the National Lithium Battery Development Blueprint (2021-2030), building a new energy battery industry chain and supply chain led by the United States.¹⁸ Internationally, the United States is leveraging existing international mechanisms, focusing on climate issues to forge alliances in the clean energy sector. Particularly in the Asia-Pacific region, the United States is cooperating with countries like Japan, which have advantages in new energy technology, aiming to establish solid cooperation relationships in supply chains and technical standards.

Solar and wind energy are two key technologies for clean energy development under the Biden administration.¹⁹ The United States has introduced legislation to increase investment in clean energy technology research and development and provided tax and financing incentives to encourage domestic companies to develop related technologies. In the Asia-Pacific region, the U.S. government is actively building alliances with an anti-China stance through multilateral mechanisms²⁰ and providing policy support to enhance the involvement of Southeast Asian countries in related industries.

The semiconductor sector, centered around chip technology, is an area where the United States currently has a technological lead and industrial dominance over China, and it is also one of the sectors where China must directly face U.S. technological blockades. Despite the semiconductor industry’s origins in the U.S., the country is currently facing disadvantages such as a shortage of technological outputs, a relative lack of skilled professionals, and a scarcity of cutting-edge process technologies.²¹ These issues are exacerbated by mutually beneficial U.S.-China trade actions and China’s accelerated technological catch-up, preventing the United States from fully decoupling from China in the semiconductor field.²² To ensure U.S. leadership in the semiconductor industry and further strategic containment of China, the United States has launched a combination of domestic policy guidance and international mechanisms. Domestically, the United States has introduced policies like the CHIPS and Science Act, increasing investment in and support for the semiconductor industry and enhancing professional talent development; it also encourages foreign advanced manufacturers to start operations in the United States and even persuades companies to relocate their core production departments to the United States. Bilaterally, the United States has intensified semiconductor technology export controls to China under the guise of “security reviews.” Multilaterally, the United States is striving to create anti-China industry alliances, such as the Chip 4 Semiconductor Alliance in the Asia-Pacific region, aiming to exclude China from the East Asian semiconductor production chain.

Historical experience shows that the key factor determining a country’s position in the international system lies in its ability to attract regional and global capital and to manipulate it according to its own interests and will.²³ Currently, China and the United States are respectively the world’s most important trading and financial nations. The essence of China-U.S. technological competition in third countries is to leverage their own technological advantages to capture larger potential markets and achieve greater industrial leadership. Existing research on the BRI has mostly focused on showcasing achievements and U.S. response policies. This paper attempts to explore how China can respond to U.S. technological competition from a current policy and academic focus. It specifically discusses the technological competition between China and the United States in Southeast Asia, examining how China can use the BRI to actively confront the U.S. tech war and trade war.

“Five Connectivities” is a key focus of the BRI, encompassing transportation, energy, and telecommunications. In transportation, infrastructure technology is exported and integrated to upgrade missing or bottleneck sections, enhancing intra-regional and inter-regional road capacity. In energy, it involves promoting regional power grid upgrades and transnational energy pipeline construction. In telecommunications, the focus is on building communication networks to ensure the smooth flow of the “Information Silk Road.” In trade facilitation, efforts are made to eliminate investment and trade barriers, promoting technological industry cooperation and the circulation of technological achievements, while also encouraging domestic enterprises to participate in infrastructure projects and industrial investments in countries along the Belt and Road. In terms of people-to-people connectivity, training and technological exchanges provide manpower support for the localization of Chinese technology in these countries, with the establishment of technology transfer centers and joint laboratories to jointly tackle technological challenges. By fostering “facility connectivity,” “trade connectivity,” and “people-to-people connectivity,” efforts are made to promote the “hard connectivity” of infrastructure such as rail transport within and among Southeast Asian countries, “soft interoperability” of rules and standards, and “chain connectivity” of industrial structures.

(i) Infrastructure Technology Hard Connectivity

Infrastructure construction is characterized by being both technology-intensive and rule-intensive. For Southeast Asian countries, infrastructure development is not only a crucial path to national development and modernization but also an inevitable journey towards narrowing the development gap between countries and achieving regional integration.²⁴ Currently, there is a huge demand for infrastructure investment in Southeast Asia.²⁵ For external powers, the ability to extend their own infrastructure technology overseas is an important measure of projecting their geopolitical influence and geo-economic impact outward. For China, promoting infrastructure construction in Southeast Asia can enhance strategic alignment and strengthen bilateral political interactions with ASEAN countries.²⁶ Compared to China, the United States does not have an absolute technological advantage and financing advantage in the field of infrastructure technology, including rail transport. Therefore, it mainly restricts China’s expansion in the ASEAN overseas infrastructure market by uniting its allies across various levels, including official governments, private enterprises, and international organizations, to promote mechanisms involving investment and financing, technological cooperation, and standard certification.

The Southeast Asia region is an essential part of the Pan-Asian Railway Network, where conventional and high-speed rail technologies become crucial for China to counter U.S. competition in infrastructure technology in the region. The United States does not have a technological advantage in high-speed rail and lacks the geographical advantage of being connected to the Indochina Peninsula, as China does. Therefore, the United States mainly adopts the following strategies to limit Chinese high-speed rail technology from entering the Southeast Asian market: First, it dilutes China’s market share in Southeast Asian high-speed rail technology through allies possessing high-speed rail technology, such as Japan, South Korea, and the European Union economies, which have competitiveness in the high-speed rail technology field. These countries entering the Southeast Asian market compete with China, slowing China’s expansion in the overseas market and hindering the process of land connectivity between China and Southeast Asian countries. Second, it proposes “infrastructure plans” to counter China’s BRI. Through plans like the Blue Dot Network and Build Back Better World, it sets thresholds for global infrastructure construction, excluding Chinese infrastructure technology from its so-called “technology standards system.”

In the process of implementing the BRI in Southeast Asia, China combines the actual infrastructure needs of the countries along the route with its technological advantages to promote development in the region. For countries with certain railway technology capabilities, able to undertake high-speed rail construction, and in need of high-speed rail to stimulate domestic circulation, China exports its high-speed rail technology with outbound aspirations to related countries only after multiple on-site inspections and rounds of professional demonstrations. For countries with relatively backward domestic railway technology, a clear lack of professional technical personnel, and an inability to afford the high costs of high-speed rail construction, China prioritizes the deployment of conventional railway technology to these countries, aiming first to achieve internal road connectivity and connectivity with neighboring countries. By building conventional railways, China gradually improves the technical ladder of domestic railway operations in these countries. The Indochina Peninsula region as a whole has huge potential for clean energy development. Therefore, China not only constructs cross-border power grids to supply electricity to countries in the region but also exports its advantageous thermal power, hydropower generation technology, and other clean energy technologies to countries in the region in phases.²⁷ For countries with significant locational advantages and relatively advanced communication technology in the ASEAN region, China also meets the regional digital development needs and collaborates with related countries to build communication infrastructure such as the ASEAN Digital Center.

Through the construction of rail transport, energy networks, and communication facilities, China effectively resolves the U.S. technological containment in the infrastructure market in neighboring regions, allowing mature Chinese technologies to be orderly transferred to surrounding areas. At the same time, by using infrastructure construction as a carrier, it realizes the gradual implementation of relevant technical standards in the neighboring market countries, achieving a synergistic effect for the diffusion of related technologies.

(ii) Soft Connectivity through Rules and Standards

“Standards and rules” encompass two meanings. The first layer involves the trade rules for the exchange of technological achievements between countries. By establishing trade rules and mechanisms, China and Southeast Asian countries facilitate trade related to technology itself, technological equipment, and technological achievements. Countries that are latecomers to technology typically have two paths to technological advancement: independent research and innovation of technology or importing technology from more technologically advanced countries. The distribution of technological development levels in the international system features a “core-periphery” pattern. For most Southeast Asian countries, which are on the periphery of global technology distribution, the effectiveness of introducing, digesting, and absorbing technology from closer to the core is higher than completely independent development. The second layer encompasses the technical standards for technology cooperation and the industry standards in industrial docking. For an industry chain, technical standards are at the apex of the product chain pyramid.²⁸ Unifying technical standards not only significantly reduces the communication costs of technological exchange between countries but also lowers the cost of adopting imported technology and technological products.

As an effective way to enhance the level of interconnectedness, deploying China’s mature technical standards and technological achievements to countries along the Belt and Road can bring about three effects: first, enhancing the influence of Chinese enterprises in neighboring countries. Technological products serve as a bridge between the exporting and receiving countries of technology, and the recognition of Chinese technological products by related countries can elevate to recognition of Chinese enterprises. Chinese enterprises going abroad also serve as a calling card for China’s overseas image. Thus, at the micro-level, recognition of Chinese technological products can spill over to the meso-level recognition of Chinese enterprises, further elevating to a high degree of recognition of the Chinese image and Chinese story. Second, promoting the alignment of Chinese technology with other technologies. The development levels of countries along the Belt and Road vary, and the same technology or technological product may have multiple technical standards. Technology-receiving countries, considering equipment and labor costs, are unwilling or prefer to dock different technical standards at a lower cost. Achieving the docking of China’s leading technical standards with the receiving country’s existing technology can enhance the compatibility between China and other standard systems, aiding in the synchronized progress of Chinese technology with countries along the Belt and Road.²⁹ Third, the interoperability of technical standards can also improve the dilemma of Chinese technology exports, reducing the integration difficulty with the existing technology of countries along the route and achieving the expansion of industrial space and the improvement of project quality.³⁰

The United States also adopts containment strategies against China in terms of technical standards, broadly following the main competitive logic of standard development at different stages. In the development phase of technical standards, it mainly suppresses competitors by controlling the right to set standards. In the application phase of technical standards, it mainly consolidates its leadership position by squeezing the market of competitors.³¹ China, using “rules and standards” as a carrier, has successfully aligned with neighboring countries in technology, stabilizing its technology market at the application level, thus breaking through the containment by the United States from the design and development to application practice stages.

(iii) Interconnectivity of Industrial Technology Chains

The Asia-Pacific region has already formed a relatively mature and clear industrial division of labor system. Due to differences in technological levels, the distribution of industries also shows regional characteristics. At the mid-to-high technology level, the entire industry chain includes upstream high-tech intensive precision components from Japan and South Korea and knowledge-intensive business services from the United States, midstream medium technology components and services, and downstream labor-intensive processing and assembly in Southeast Asian countries, with the final products flowing back to the United States, China, and other regions. In the low-technology field, the entire industry chain includes upstream high-tech intensive precision components from Japan and South Korea, mid-to-downstream labor-intensive processing and assembly in Southeast Asian countries and China, with the final products sold to the United States, China, and other regions.³² Currently, China faces two main challenges: one is at the upstream knowledge-intensive services and technology-intensive product level, facing various “chokepoint” strategies implemented by the United States and its allies; the other is the “blockage” situation faced after the downstream production phase when exporting to the Western markets of the United States and others. The key to solving the “chokepoint” problem lies in achieving breakthroughs in independent technology, and the sources of technological innovation, besides importing from technologically advanced countries, include independent innovation and technology transfer followed by the return of technology.

By establishing industrial parks in Southeast Asian countries, China has achieved the incremental transfer of its existing mature technologies to the Southeast Asian region. For industrial technology, China, by establishing industrial parks, transfers production technologies that are currently in the mid-to-downstream position of the industrial chain to Southeast Asian countries, solving local primary product needs on the one hand, and breaking the export restrictions imposed by the West on related Chinese technologies on the other, providing growth space and funding sources for technological advancement. Through establishing joint laboratories, China disseminates its advantageous scientific and technological advancements to less developed countries in Southeast Asia. On one hand, this allows science and technology to find broader application spaces, and on the other hand, through technological cooperation, ensures China’s dominant position in the development of related technologies, while technology return also promotes further enhancement of China’s domestic technology. By achieving industrial docking with neighboring countries, it counters the United States’ attempt to create a “China-excluding product value chain” and perfects the “China-neighboring industrial system.”

The Chinese government and enterprises, leveraging the platform of the Belt and Road Initiative, have gradually established “hard connectivity of infrastructure,” “soft interoperability of rules and standards,” and “chain connectivity of industrial structure.” This has also led to the enhancement of political relations between China and Southeast Asian countries, optimization of the convenience of business and trade between China and ASEAN, and increased coupling of industrial relations between China and its neighbors, thus mitigating the U.S. technological containment of China at the levels of technological achievement markets and industrial technology leadership.

Figure 1    Schematic Diagram of China Breaking Through American Technological Containment in Southeast Asia through the BRI

III. The Belt and Road Initiative and Responding to U.S. Technological Competition in Southeast Asia

As the analysis above shows, the current U.S. government’s implementation of technological containment against China involves direct technological blockades at the bilateral level and technological competition and isolation at the third-party level, with the latter being the main method of containment China faces in Southeast Asia. Although China occupies a central position in the East Asian industrial value chain, it is not entirely at the technological upstream end and the final market end. In this context, how has China managed to break through the United States’ technological containment in the Asia-Pacific region using the Belt and Road platform? This paper selects three cases where China promotes railway and other infrastructure technologies in Laos, aligns with Southeast Asian countries on 5G technology, and builds industrial parks in Malaysia to discuss the points above. These three cases were chosen based on the following four reasons: First, the cases are typical, as the “hard connectivity,” “soft interoperability,” and “chain connectivity” in implementation are interconnected rather than existing independently. The cases selected emphasize the aspect of “connectivity”; Second, the countries chosen for the three cases currently have relatively mature BRI projects on the ground; Third, in terms of selecting countries that rely on breaking through U.S. technological containment, the chosen countries are also representative. Malaysia has a long-term and relatively close cooperation relationship with the U.S. in military and economic fields, Laos is a country in Southeast Asia that has established a comprehensive strategic partnership with China, and Thailand is a country that has successfully managed its relations with China and the U.S.; Fourth, in terms of development level, the selected cases include countries with relatively high levels of modernization in the region, as well as countries with lower levels of development. Such selection demonstrates the broad cooperation space of China’s Belt and Road Initiative for countries along the route with different national conditions.

(i) China-Laos Infrastructure Cooperation: From “Hard Connectivity” and “Chain Connectivity” to Comprehensive Deepening of Cooperation

Southeast Asia, with its vast territory and numerous countries, exhibits significant disparities in development levels among its nations. Except for Singapore, the rest of the countries in Southeast Asia are developing countries, with Laos, Myanmar, and others still in the process of escaping the “Least Developed Countries” status.³³ The proposal and implementation of the Belt and Road Initiative have effectively improved the situation of infrastructure scarcity in developing countries in Southeast Asia. However, the United States views this change through a confrontational lens. Therefore, influenced by both the regional development needs and intensified great power political competition, Southeast Asia has gradually become a focal area of great power infrastructure competition, presenting a complex situation of major technological competition and small country technology dependency.

Infrastructure construction is fundamental to national economic development and an effective tool that can guide, challenge, or reshape power relations. ³⁴ International infrastructure competition and cooperation also involve complex games among multiple stakeholders. Although the United States initially paid relatively insufficient attention and investment to the Southeast Asia region under Trump’s presidency, with the deepening cooperation between China and Southeast Asian countries and the transformation and upgrade of the U.S. Indo-Pacific Strategy, the Biden administration’s Indo-Pacific Economic Framework gradually targeted Southeast Asian countries as key entities to woo, making Southeast Asia once again a focus area for the United States to counterbalance China. At the G7 summit held in June 2021, Biden administration officials explicitly stated that “Build Back Better World” would not only provide infrastructure projects for developing countries but also “defeat” the BRI by offering high-quality options. In May 2022, the Quadrilateral Security Dialogue (Quad) countries reiterated their goal of gradually replacing the BRI with “high-quality” and “sustainable” infrastructure investments at the Tokyo summit. Subsequently, the United States invested heavily in infrastructure resources attempting to shape a “free and open Indo-Pacific order,” launching the Indo-Pacific Strategy, Economic Prosperity Network Plan, and Blue Dot Network plan, achieving a series of results, such as the urban railway improvement project in Ho Chi Minh City, Vietnam, renewable energy projects in Indonesia, and coastal disaster reduction facility assistance projects in Southeast Asia. The competition and game between China and the United States in Southeast Asia have expanded from traditional geopolitical fields to various domains including the economy, infrastructure, digital technology, and governance rules.

However, geographically distant from Southeast Asia and with limited investment, the United States approaches Southeast Asia with a strong hue of containing China and hegemonic thinking, positioning Southeast Asian countries as followers and participants rather than leaders. Specifically, the U.S. Indo-Pacific Economic Framework and Blue Dot Network aim to establish and build a “high-standard” club, attempting to form a new alliance of emerging digital countries in the Indo-Pacific region with “selective” cooperation. This approach somewhat detaches from the reality of large development disparities in the Southeast Asia region. Its advocated “high standards” far exceed the domestic standards of underdeveloped countries, excluding some economically backward countries from the Indo-Pacific Economic Framework, which contradicts the principles of openness, inclusiveness, and mutual benefit followed by regional multilateral mechanisms.³⁵ The U.S. strategy of implementing new digital economic rules and high-standard infrastructure and industrial cooperation in Southeast Asia not only provides limited support and assistance to underdeveloped countries in the region but may further widen the development gap in Southeast Asia, not meeting the urgent needs of several underdeveloped countries in the region to achieve “connectivity.”

Infrastructure cooperation is one of the most important areas of cooperation that China has undertaken in Southeast Asia. Compared to the U.S. “high-standard” Indo-Pacific Economic Framework and Blue Dot Network in Southeast Asia, China’s BRI brings significant and effective economic development opportunities and contributions to the region, especially to underdeveloped countries like Laos, Myanmar, and Cambodia, elevating China-Southeast Asia infrastructure cooperation to new heights and filling the huge gap in infrastructure financing in developing countries in Southeast Asia to some extent.³⁶ Moreover, since Trump’s presidency, the technological field has become a key area for the United States to “decouple” from China. Forced by the need for political alignment and security pressure imposed by the United States, many countries, represented by Australia, have changed their ways of conducting technological cooperation with China, facing blockades and restrictions imposed by the United States on China’s technology “going out.” Therefore, Southeast Asian countries’ support for Chinese infrastructure projects also provides significant assistance for China to break through the U.S. technological containment and achieve global technological diffusion, making it a rational choice of “win-win” for China and Southeast Asian countries.

From the outset of the Belt and Road Initiative, China clearly proposed the goal of “strengthening connectivity construction with ASEAN countries,”³⁷ continuously seeking points of mutual interest in bilateral cooperation, and advocating priority for infrastructure project cooperation when collaborating with developing countries in Southeast Asia. For these countries, Chinese infrastructure cooperation and technology transfer are urgent needs to break through development barriers. With Chinese funding, technology, and personnel support, Southeast Asian countries have built a number of major projects beneficial for solving their own energy shortages and promoting economic development. Among them, the China-Laos Railway has become a flagship project of China’s BRI cooperation in the Indochina Peninsula, not only greatly improving Laos’ regional development environment but also becoming an important platform for upgrading bilateral relations between China and Laos, laying a solid foundation for the deepening and development of China-Laos cooperation.³⁸

Laos and China, both socialist countries, are key focus nations under China’s BRI. Since the normalization of Sino-Lao relations in 1989, the two countries have cooperated in various fields such as the economy, politics, culture, and technology, with frequent leadership visits and numerous consensuses reached, leading to the steady development of China-Lao relations. However, as the only landlocked country in northern Indochina, Laos has long been troubled by complex terrain, inconvenient transportation, and weak industrial foundation. To break through the mountainous barriers and facilitate foreign trade, Laos set a national development goal to transform from a landlocked to a land-linked country, effectively aligning with China’s Belt and Road Initiative, further deepening and integrating Sino-Lao cooperation. In 2016, China and Laos signed the “Memorandum of Understanding on Jointly Formulating Plans for Cooperation on the Construction of the Belt and Road” between the People’s Republic of China and the Lao People’s Democratic Republic, followed by the signing of the Memorandum of Understanding on Jointly Promoting the Construction of the China-Laos Economic Corridor in 2017 and 2019, and the Action Plan on Building a Community of Shared Future between the Communist Party of China and the Lao People’s Revolutionary Party,³⁹ proposing the idea of “accelerating the alignment of China’s BRI with Laos’ strategy to transform from a landlocked to a land-linked country.”⁴⁰ Both sides emphasized the necessity of basing cooperation on the construction of the China-Laos Railway, expanding comprehensive, multi-level cooperation, and carrying out economic and trade cooperation with a focus on connectivity and capacity and investment cooperation, further advancing pragmatic cooperation between China and Laos in fields such as transportation, capacity, electricity, minerals, agriculture, tourism, and the digital economy.⁴¹

Technological progress, while expanding national territories and developing new spaces for international competition, also changes a country’s geostrategic value and national development strategy planning.⁴² The mountainous and plateau terrain, lack of access to the sea, and backward transportation infrastructure construction have been long-term bottlenecks restricting Laos’s economic growth. Early in the 21st century, Laos proposed cooperating with China to build railways to change its landlocked predicament. ⁴³ Now, with the maturity and upgrading of infrastructure and high-speed railway construction technology, Laos, deeply located in inland Southeast Asia, has a significant opportunity to leverage its geographical advantages and become a hub connecting Southeast Asian countries and countries outside the region. Against this backdrop, China, with sufficient funds, mature technology, and a commitment to “going out,” has become an important aid for Laos to solve its development problems. Therefore, under the high attention and active promotion of the high-level leadership of both countries, the construction of the China-Laos Railway, a typical demonstration of “hard connectivity” under the BRI, has entered the fast track. The China-Laos Railway officially commenced construction in December 2016, achieved full-line operation in December 2021, and began carrying international passengers in April 2023. The railway, built entirely to Chinese management and technical standards, is an important part of the central corridor of the Trans-Asian Railway, marking a leap in Laos’ transportation capacity and the connectivity between China and Laos.⁴⁴

China’s BRI construction in Southeast Asia not only amplifies Laos’s regional cooperation and bilateral advantages but also further narrows the development gap between countries within the region. After the completion of the China-Laos Railway, the goods trade of the railway covered Malaysia, Myanmar, Thailand, Bangladesh, and other countries, establishing a geographical and psychological bidirectional connection in Southeast Asia, bringing multiple development dynamics to Laos, China, and the Southeast Asian region. The China-Laos Railway, along with the existing Kunming-Vientiane Highway, China-Laos Expressway, and China-Laos Mekong River shipping, has generated a resonating effect, greatly improving Laos’ transportation situation and investment environment, strengthening the industrial chain integration between China and Laos,⁴⁵ and providing Laos with an important opportunity to transform from a “landlocked peripheral country” to a “transit central country.” The introduction and application of new technologies in the construction process have further driven the iterative upgrade of other industrial sectors in Laos.⁴⁶ The opening of the China-Laos Railway also further promoted Yunnan Province’s opening to the outside world, connectivity with the Southeast Asian region, and the development process of the western region of China. Therefore, for Laos, which urgently needs economic development and industrial upgrading, the infrastructure cooperation and technology transfer provided by China, compared to the U.S. Indo-Pacific Economic Framework, not only meets the strategic needs of underdeveloped countries but is also more conducive to the unity of the Southeast Asian region.

The China-Laos Railway project is a prime example of transitioning from “hard connectivity” and “chain connectivity” to comprehensive deepening cooperation. Since Chinese infrastructure technology entered Laos, it has significantly helped improve Laos’ technological level and industrial manufacturing capabilities. It has also provided a platform for the Laotian people to access Chinese culture and understand China’s development, enhancing China’s influence in the Southeast Asian region. This facilitates policy communication and people-to-people bonds between China and Laos.⁴⁷ As the Belt and Road Initiative and Laos’s strategy to transform from a landlocked to a land-linked country continue to align and expand with ongoing infrastructure project cooperation, China deepens bilateral industrial and capacity cooperation, accelerating the transfer and investment of high and new technology to Laos. Close collaboration with the Lao Ministry of Science and Technology has driven the joint establishment of practical cooperation projects like the China-Laos Renewable Energy Joint Laboratory, the China-Laos Modern Agricultural Science and Technology Park, and the China-Laos Technology Transfer Center. These projects actively support and lead bilateral economic cooperation in high and new technology, enhancing the reliability and sustainability of relations between China and Laos.⁴⁸ Both countries are also working on developing and implementing the China-Laos High-Tech Industrial Park, where infrastructure cooperation projects and scientific and technological industries from China are continually enhancing Laos’s scientific, technological, and social development levels. In the future, infrastructure and technological industry cooperation between China and Laos is expected to further evolve into “soft connectivity” in rules and standards.⁴⁹ However, the China-Laos Railway has yet to achieve railway standard connectivity and unification with neighboring countries. The construction of logistics hubs, transshipment stations, and freight stations along the railway requires further improvement. The two countries also face mismatches in trade policy standards and legal rules, and the railway-aligned industries have yet to form a well-coordinated service mechanism. Each logistics company operates independently, unable to undergo unified management and scheduling. Therefore, some studies suggest that with the intensification of China-U.S. competition and the escalation of U.S. interference in Southeast Asia, China should further leverage the cohesive role of infrastructure and technology cooperation projects. It should pay attention to the Southeast Asian developing countries’ desire for industrial structure upgrading and high-tech development, increase investment in old industries, especially light industries, plan appropriate industrial projects for development, enhance inter-industry connectivity between countries, promote the docking and mutual recognition of infrastructure policies, and continuously deepen the industrial chain integration between each other.⁵⁰ Meanwhile, China should also consider the concerns and sovereignty sensitivities of small and medium-sized countries in Southeast Asia, ASEAN’s pursuit of balance, and the interference of external major powers like the U.S. and Japan in China’s infrastructure cooperation in the Southeast Asian region,⁵¹ continuously optimizing the content and measures of the BRI.

(ii) Supporting ASEAN’s Digital Construction: Realizing the Soft Connectivity of Rules and Standards for Chinese 5G Technology to Break Through in Southeast Asia

Technical standards are consistent specifications for technological products throughout their production process, covering technology and its related infrastructure, equipment, applications, and services. Countries with technological advantages can maintain their leadership in relevant fields through “standard competition” and “standard monopoly”; they can even transform their technological advantages into a competitive edge in their grand strategy through technological competition. With the rapid development of digital technology, technology has increasingly become an important support for the growth of a country’s comprehensive national strength, and the United States has made it a priority to contain the development of Chinese science and technology.⁵² Economists believe that the infrastructure supporting the development of the digital economy era mainly includes mobile internet, industrial internet, the Internet of Things, and big data centers built on the basis of the fifth generation and more advanced mobile communication technologies, with core technologies including cloud computing, big data analysis, artificial intelligence, blockchain, quantum computing, etc.⁵³ The competition for these disruptive technologies has become a manifestation of U.S. efforts to suppress China’s potential global leadership position in technology.⁵⁴ 5G technology, as a supporting technology for human-machine connectivity and the latest standard for mobile cellular networks, marks China’s transition from a follower to a challenger and then to a leader in this field. Each generation of mobile communication technology carries more data, requiring modems in related network equipment to have stronger computing power. Due to the limited nature of the radio frequency spectrum, chip designers need to optimize semiconductors to transmit more data.⁵⁵ Therefore, the U.S. containment of Chinese 5G technology is also a suppression of China’s chip technology and fundamental algorithm development.

As a synthesis of various technologies, 5G technology cannot be accomplished by a single company or even a single country alone; its standards include aspects such as coding and air interface protocols. Different working groups research and propose different sub-standards. Due to the differing development situations of countries, the technology standards adopted as priorities also vary. For instance, there are two frequency bands available for 5G: Sub-6Ghz and millimeter wave. China, based on the practical need for low-cost, large-scale deployment of 5G base stations and to better address network signal coverage issues in remote areas, has prioritized the Sub-6Ghz band. In the United States, since the majority of the 3-4Ghz spectrum had already been allocated to the U.S. military, U.S. 5G operators could only begin studying and deploying in the millimeter wave spectrum. The most intense competition in the development of 5G technology was in the channel coding standards. Initially, the low-density parity-check (LDPC) code technology championed by Samsung received support from suppliers such as Qualcomm and Nokia, as well as the United States and Japan, whereas the polar code technology advocated by Huawei was supported by companies like ZTE, Datang, and Xiaomi. After multiple rounds of negotiation, an agreement was reached where LDPC codes became the international standard for data channels, and polar codes for control channels. The depth of the competition in coding standards created the illusion that the U.S.-China 5G rivalry was essentially a coding dispute between Huawei and Qualcomm.

Metcalfe’s Law states that the value of a network is equal to the square of the number of its nodes.⁵⁶ Similarly, the value of digital technology products lies in whether they have a broad market and user base. Only technology standards accepted by users can survive in competition. The 5G field has already formed a complete industrial chain, where the upstream includes chips and modules, optical devices, RF devices, and optical fibers as transmission media; the midstream includes transmission equipment such as base stations, network devices like routers, and network planning services; and the downstream includes various smart terminals including smartphones, various application scenarios including smart cities, as well as network operations composed of operators and operational services.⁵⁷ To contain the development of Chinese 5G technology, the United States adopted a strategy of cutting off supply of high-end components upstream and besieging the market downstream. In June 2020, the Trump administration announced the “Clean Network” plan, including the “5G Clean Path,” aiming to contain China’s technology development across all aspects of 5G technology research and application. Additionally, legal regulations such as the Executive Order on Securing the Information and Communications Technology and Services Supply Chain were introduced to restrict normal technology exchanges between U.S. companies like Qualcomm and Intel with Chinese entities; leveraging extraterritorial jurisdiction among other means to prevent companies like ASML from exporting advanced semiconductor products to China. China’s high-tech exports are mainly concentrated in the information and communication technology industry. To suppress China’s 5G technology in overseas markets, the U.S. not only competed with China in third-party technology markets in collaboration with allies but also exerted political pressure on third countries under the guise of endangering bilateral security cooperation, attempting to sever China’s connections with overseas markets.

As one of the regions with the fastest economic growth in the world, Southeast Asian countries have a considerable demand for investment in 5G infrastructure.⁵⁸ This region not only serves as a natural testing ground for Western 5G technology but also as a frontline battlefield for Chinese 5G technology to go global. To limit Southeast Asian countries’ use of Chinese 5G technology, the United States maintains close commercial and technological ties with these countries on one hand. For example, the technical team and management level of the Thailand Telecommunications Association include members from top U.S. tech companies like Qualcomm and Intel, and the U.S. Department of Commerce once requested the Thailand Telecommunications Association to provide information on Thailand’s 5G development to seek cooperation opportunities.⁵⁹ On the other hand, using the pretext of “affecting national and ally security,” the U.S. demands Southeast Asian countries to reduce or even abandon the use of communication infrastructure from Chinese vendors.⁶⁰ Beyond coercing Southeast Asian countries under the guise of ensuring information and supply chain security, the U.S. also attempts to “entice” countries within the region to join its information and communication circle with the slogans of “security” and “openness,” thereby squeezing China’s market space in the region.⁶¹

The construction of the “Digital Silk Road” and the phased achievements it has made aim to assist countries along the BRI in developing digital infrastructure and increasing the level of informatization. However, measures to promote digital technology infrastructure connectivity within the region are also continually reducing the U.S. technological containment of China in the 5G field. As a crucial support of the BRI, the “Digital Silk Road” encompasses numerous technology projects, including the construction of 5G base stations, laying communication optical cables, establishing data centers, and providing technological services.⁶² In general, the process of “soft connectivity” in technological standards is achieved through a “government sets the stage, enterprises perform” approach. “Government sets the stage” refers to the signing of cooperation agreements between governments at all levels under the Belt and Road Initiative, providing institutional guarantees and necessary financial support for regional and sub-regional technology exchange and cooperation at the macro level. “Enterprises perform” means that digital technology companies play a primary role in technology exchange and cooperation, promoting 5G technology connectivity, sharing, and win-win between bilateral and multilateral parties at the meso and micro levels.

At the intergovernmental level, China and ASEAN initiated the China-ASEAN Information Harbor in 2015, with the main construction goal of building the China-ASEAN information hub and the “Information Silk Road” connecting China and ASEAN. Subsequently, both parties strengthened cooperation in digital technologies like 5G, blockchain, smart city, telemedicine, and e-commerce. A series of cooperation agreements have not only provided a practical approach for integrating China’s 5G technology with Southeast Asian countries but also outlined steps for technological updates and upgrades in the region, offering solutions for how foundational communication technologies like 5G can integrate with regional economic development and support sustainable digital economy growth.

At the enterprise level, China’s 5G service providers, leveraging platforms such as the Belt and Road and “Digital Silk Road,” collaborate with local countries in Southeast Asia based on their real development situations and actual needs. Indonesia, the largest country in Southeast Asia, still primarily relies on a 4G network for its telecommunications backbone. Limited by its unique geographical environment, Indonesia’s current plan is to first complete the connectivity of the entire archipelago with a 4G network, transitioning from analog to digital technology. Thus, promoting 5G applications at the enterprise level and achieving digital transformation in key cities are critical steps for Indonesia’s digital economy development and the practical soil for rooting China’s 5G technology in Indonesia.

Thailand is among the first countries in Southeast Asia to deploy commercial 5G technology and one of the fastest in the world for 5G construction. The Thai government aims to promote further integration of 5G and other digital technologies with national industries through strengthening collaboration between the public and private sectors, helping Thailand achieve its Industrial 4.0 national strategy goals. Developing Thailand as a regional leader in 5G technology and a data center hub in Southeast Asia has been the Thai government’s vision in recent years.⁶³ In infrastructure, Huawei has enhanced cooperation with the National Broadcasting and Telecommunications Commission of Thailand to build the “Gigabit Thailand” digital infrastructure through constructing fiber broadband infrastructure, expanding broadband coverage, and promoting local digital transformation. In terms of industry applications, taking the medical field as an example, Huawei collaborated with Siriraj Hospital and the National Broadcasting and Communications Commission of Thailand in 2021 to establish the first 5G smart hospital project in ASEAN. This project introduces 5G, artificial intelligence, and other technologies to promote balanced development of medical resources in Thailand and optimize and upgrade the Thai medical industry. Regarding talent cultivation, Huawei trains digital technology talents for Thailand and the ASEAN region through the ASEAN Academy, the Seeds for the Future program, and promotes the localization process of Huawei employees.

Leveraging intergovernmental cooperation mechanisms, Chinese 5G technology companies are deeply involved in the construction of 5G in Southeast Asian countries. By integrating with local existing communication technologies and cultivating local professional talents, Southeast Asian countries’ acceptance of Chinese 5G technology standards and 5G technology has been improved at various levels from equipment deployment to industry application to industrial ecology. This, in turn, helps Chinese 5G and related technologies expand into the ASEAN market, breaking through the strategic containment of Chinese 5G technology by the United States in the Asia-Pacific region, and providing a new counter-field to alleviate the continuous technological competition from the United States.⁶⁴

(iii) China-Malaysia Industrial Parks: Breaking Through with “Chain Connectivity” to Realign Industrial Technology

For the United States, the continually developing China represents its greatest strategic threat. From launching a trade war against China to decoupling in technology, a primary goal of the U.S. containment strategy against China is to push China out of the current global supply chains. To this end, the United States has systematically devised a series of plans, including the Indo-Pacific Strategy, the Blue Dot Network, the Build Back Better World, the AUKUS trilateral security pact, and the Indo-Pacific Economic Framework, aimed at curtailing China’s influence in Southeast Asia. Consequently, Southeast Asia has become a converging point for China’s BRI and the U.S. Indo-Pacific Strategy.⁶⁵

Over the years, the United States and Malaysia have maintained a relatively close economic cooperation relationship, with Malaysia being the second-largest trading partner of the United States in Southeast Asia. The United States has repeatedly attempted to use the South China Sea issue to drive a wedge between China and Malaysia, intending to strengthen U.S.-Malaysia bilateral cooperation within its Indo-Pacific strategy. Although Malaysia is not an ally of the United States, its economic and geopolitical value has made it one of the key nations that the U.S. seeks to court in Southeast Asia.⁶⁶ In response to the challenges posed by the United States to China-Malaysia bilateral relations, China has delved deeply into the mutual needs of both nations for industrial investment and technological cooperation. It has chosen to expand trade in technological achievements with neighboring countries through “Trade Connectivity,” while achieving “Chain Connectivity” between its own advantageous technological industries and those of neighboring countries through various means of technology diffusion and integration. Under the combined effect of the firm friendship between China and Malaysia and the Belt and Road Initiative, the two countries have maintained close collaboration within the framework of the initiative, sharing a consensus on many international and regional issues. The cooperation between China and Malaysia has continued to deepen across multiple technical fields, including automotive, energy, steel, machinery manufacturing, and industrial parks.

Malaysia has a strong desire to develop industries and introduce technology, and it has a relatively deep history of technological cooperation with China, making it one of the first countries to respond to China’s BRI. The technology transfer from China to Malaysia is mainly conducted through the establishment of industrial parks. By setting up industrial parks in Malaysia related to China’s mature technologies, these technologies can form a clustering effect with upstream and downstream technologies and outputs in spatial terms, shortening the process from technological ideation to outcome transformation, and achieving “chain connectivity” to a greater extent.⁶⁷ The “China-Malaysia Qinzhou Industrial Park” and the “Malaysia-China Kuantan Industrial Park” are industrial parks jointly established by China and Southeast Asian countries. They serve as pioneering demonstration zones for industrial integration and technological exchange, symbolizing a model for technological collaboration between China and Southeast Asian nations. The Malaysia-China Kuantan Industrial Park, in particular, focuses on industries where China holds a technological advantage, including metal smelting, machinery manufacturing, renewable energy, electronic information, and petrochemicals.⁶⁸ For China, leading its domestic superior technologies abroad not only allows for the transfer of excess production capacity to neighboring countries in need, fostering mutual benefits and collaborative development between the two nations, but also enhances the localization of technology and its outcomes in the host country.⁶⁹ This approach helps to refine the “China-neighboring” technological ecosystem, facilitating a regional cycle and mitigating the impact of Western technological blockades and supply chain restrictions on China. Taking the steel industry, a key focus of the Malaysia-China Kuantan Industrial Park, as an example, the mutually beneficial nature of China-Malaysia industrial chain cooperation becomes evident. Malaysia lacks the raw materials for steel smelting and primarily relies on electric arc furnace technology, resulting in low self-sufficiency and capacity utilization rates. Meanwhile, China, despite being the world’s leading steel producer, faces a pressing need to upgrade its technology. Affected by the global “dual carbon” policy environment, the steel produced by China’s mainstream “blast furnace-converter” process is increasingly restricted in overseas markets, especially in the West, leading to obstructed export channels. Conversely, Malaysia is in a rapid urbanization phase with a growing demand for steel. Additionally, as a primary automobile producer in Southeast Asia, the influx of technology empowerment and capital investment from foreign automakers into Malaysia in recent years has revitalized the local automotive technology and industry, thereby significantly boosting the demand for steel. This surge in demand has naturally facilitated the cooperation between China and Malaysia in the steel industry.

In recent years, China’s investment in Malaysian steel technology has begun to bear fruit. The joint venture Alliance Steel Malaysia, funded by China, is the country’s largest steel mill. Its products have entered markets in over 20 countries worldwide, with exports accounting for 70%.⁷⁰ The rapid development of infrastructure, the automotive industry, and clean energy technology have synergized with China’s steel technology, not only promoting urbanization and industrial development in Malaysia but also helping China further optimize its technological structure with neighboring countries.⁷¹ This has led to the regional diffusion of Chinese steel technology, effectively circumventing sanctions and blockades from Western countries to a certain extent, and promoting adjustments in the steel industry order in East Asia. This not only benefits the optimization of bilateral economic and trade structures but also facilitates China’s gradual move towards both ends of the steel technology smile curve.

As a model of China-Malaysia technological industrial park cooperation, the transfer of steel industry technology has been successful in Malaysia. With the concurrent elevation of technological levels in China and Malaysia, Malaysia’s national development needs, and the spread of U.S. technology containment to high-tech fields, China has begun to diffuse more advanced technologies to Malaysia. New energy vehicles are one of China’s breakthrough industries in circumventing Western technological blockades, with brands such as BYD, Geely, Chery, and Great Wall flourishing in overseas markets in ASEAN and the EU, achieving significant success. This is crucial for China, as it faces simple tariffs and anti-dumping measures from the U.S. in lower-tech fields like steel technology. In contrast, in high-tech areas, the U.S. maintains its technological advantage by leading in core algorithms and industrial design, limiting technology exports and industrial migration to constrain China’s technological development in related fields. Hence, improving China’s industrial chain layout overseas and facilitating regional industrial circulation are key to circumventing U.S. technological and industrial blockades in high-tech fields. Given these developments, China views Malaysia not merely as a market for automobile exports but is starting to leverage Malaysia’s existing technological level and development needs to extend the industry chains of its advantageous automobile enterprises into the country, allowing Malaysia to participate in China’s new energy automobile technology industry system more deeply.

Chinese automobiles have gone through a complete landing process in Malaysia, from enterprise acquisition and vehicle export to industry linkage, and then to industrial park construction. This includes long-established enterprises like Changan Automobile as well as pillars of modern Chinese industry like Geely, which grew after the reform and opening up. The process of automobile technology transfer aligns with Malaysia’s automotive development and transformation policies. After experiencing a boom in the 1980s, Malaysia’s automotive industry gradually entered a decline due to the impact of countries like the United States, Japan, and South Korea, along with its own lagging technological development. In 2014, Malaysia introduced a national automotive policy focusing on the use of new energy technologies, aiming to become a production hub for new energy vehicles in the ASEAN region.⁷² In 2017, China’s Geely Automobile acquired 49.9% of the shares of Proton, Malaysia’s national brand under the diversified resources-heavy industrial holding group DRB-HICOM, marking the beginning of the transfer of Chinese automotive production technology to Malaysia and ushering in a new era for Malaysia’s automotive industry development. From 2018 to 2022, Proton’s sales increased by 118%, ranking second in Malaysia’s domestic market sales and market share for four consecutive years, with the highest overseas export sales. In 2019, Changan Automobile reached an agreement with Malaysia’s Fieldman company, granting it exclusive distribution rights for Changan Automobiles in Malaysia, thereby further entering the Southeast Asian market. In 2020, based on advancements in digital technology, Malaysia proposed a new development plan for next-generation vehicles, mobility as a service, and Industry 4.0.⁷³ In 2022, Fieldman company received an investment of 1 billion Malaysian Ringgit to collaborate with Changan Automobile in building the first electric vehicle assembly plant in the Malacca region.⁷⁴ In 2023, Geely Holding Group signed a deep cooperation framework agreement with DRB-HICOM to conduct broader cooperation around the construction of Tanjung Malim Automotive High-Tech Valley in Malaysia, aiming to develop this automotive industrial park into a core of R&D and manufacturing for new energy and new technologies in Southeast Asia.⁷⁵ As a major automotive consumer in the Southeast Asia region, Malaysia’s new energy vehicle market remains a blue ocean, with electric vehicle sales in 2022 increasing by 860% compared to 2021, maintaining a high growth momentum.⁷⁶

Additionally, the overseas expansion of Chinese automobile companies to Southeast Asia serves as a strategy to counteract the “chip supply cut-off” by the United States and its allies and partners.⁷⁷ With the automotive industry increasingly recognized as the second largest source of revenue growth by the semiconductor industry due to enhancements in safety performance, infotainment, and electrification levels,⁷⁸ Malaysia stands as the world’s seventh-largest semiconductor exporter and a major global hub for chip testing and packaging, holding a 13% share of the global market. Automotive collaboration with Malaysia helps China break through the chip blockade. During the COVID-19 pandemic, Malaysia’s semiconductor production reduction caused by the pandemic forced many global mainstream automakers to suspend production lines. Localizing automobile production lines in Malaysia could benefit Chinese new energy vehicle companies in integrating the automotive chip and other industry orders while expanding into the Southeast Asian market. Following the achievements of cooperation in steel and automotive industry parks between China and Malaysia, China further leveraged its integrated advantages in smart cities, promoting technologies like information and communication, artificial intelligence, etc., heavily blocked by the United States, to take root in Malaysia. The cooperation space between the two countries in cross-border e-commerce, traditional enterprise digital transformation, and digital infrastructure further expanded. In May 2019, China’s SenseTime Company signed a strategic cooperation agreement with Malaysia’s G3 Global and China Harbour Engineering Company to jointly build Malaysia’s first artificial intelligence industrial park, which is also the first AI-driven science city in ASEAN. The industrial park is expected to be completed within 5 years, after which it will not only provide Malaysia with talent training in the field of artificial intelligence, technological research, and industrial development to enhance Malaysia’s overall level of artificial intelligence but also explore the development and application of artificial intelligence technology in smart cities and intelligent transportation.⁷⁹

The China-Malaysia industrial parks serve as platforms for technological exchanges and capacity cooperation between China and Malaysia, showing initial success in transitioning from traditional energy and infrastructure to new energy, advanced manufacturing, and high-tech industries. This deepens the level of technological exchange between the two countries, enhancing the coupling of their industrial structures and generating positive external economic benefits in the region. The coordinated and complementary development of different industrial parks, in terms of policy, function, and industry, further connects industrial and supply chains, creating “economic special zones” of technological relevance and forming a “China-Periphery Technology Community.” This achieves a broader integration effect.

However, there are still risks in China’s industry docking and technological cooperation with Malaysia and other neighboring countries, such as economic risks due to policy differences and insufficient radiative effects of parks, political risks from changes in Malaysia’s ruling party, and cultural risks arising from cultural differences.⁸⁰ Therefore, China needs to use the Belt and Road Initiative as an opportunity and technology cooperation as an entry point to break through U.S. strategic containment in a misaligned manner, exploring cooperation potentials in new energy, digital infrastructure, 5G, AI, and blockchain that Malaysia is interested in, achieving deep integration of product chains.⁸¹ At the same time, China should be aware of the U.S. strategic layout in Southeast Asia, respect and maintain ASEAN’s position in regional affairs to prevent the U.S. from using the South China Sea issue to sow discord between China and Southeast Asian countries, seeking more favorable conditions for developing China-ASEAN and China-Malaysia relations. In the process of technology cooperation and industry docking, with “policy communication” and “people-to-people bonds” as the premise and guarantee, China aims to promote technological communication and industry integration between China and Malaysia.

IV. Conclusion

From 2013 to 2023, the BRI marked its tenth anniversary. During this period, the United States government’s strategy towards China officially shifted from strategic engagement to strategic competition. The U.S. attitude towards the Belt and Road Initiative changed from initial indifference to tentative engagement and limited resistance, eventually evolving into full-scale opposition. Due to the transition from the Trump to the Biden administration, the U.S. approach to containing China technologically also shifted from unilateralist thoughts of technological and trade wars towards building exclusionary technological alliances based on a “small yard, high fence” model.⁸² In response to the U.S. technology war, China not only took measures to directly counter U.S. containment strategies but also leveraged the BRI platform to proactively open two “second frontiers.” The first “second frontier” refers to China diffusing its existing mature technologies to third-party countries, gradually establishing a technological interaction system with other countries to provide financial and technological sources for technological autonomy and innovation. The second “second frontier” involves China utilizing its unique geographical advantage in the Asia-Pacific region to establish physical connections in public transportation, information communication, and other dimensions with neighboring countries. These physical connections serve not only as tangible carriers for Chinese technology going overseas but also as physical mediums for technological cooperation with neighboring countries.

The United States initiated a trade war against China and pursued comprehensive “decoupling” in technology, aiming to squeeze China out of the current global industrial chain. To this end, the United States laid out multiple strategies, including the Indo-Pacific Strategy, Blue Dot Network, Build Back Better World, AUKUS, and the Indo-Pacific Economic Framework, to prevent China’s influence from expanding in Southeast Asia, making the region a convergence zone for China’s BRI and the U.S. Indo-Pacific Strategy.⁸³ Laos serves as the overseas starting point of the China-Indochina Peninsula Economic Corridor and plays a crucial role in promoting the “Lancang-Mekong Cooperation” mechanism with the Indochina Peninsula region. Thailand, as the geographical hub of the Indochina Peninsula and the fastest country in Southeast Asia to transform its digital economy, along with Malaysia and Indonesia, are key nodes connecting China with Singapore on the economic corridor and are mature countries in industrial cooperation with China. Although not discussed in this article, other countries, despite different national conditions, share similar demands for technological development and hold the same expectations for the role of the BRI in investment, financing, and technological cooperation. Under the push of the BRI, the Asian Infrastructure Investment Bank approved 202 projects from 2016 to 2022, with financing amounting to over $38.8 billion, benefiting 33 countries.⁸⁴ Leveraging platforms like the AIIB and the Silk Road Fund, China and neighboring countries jointly constructed projects such as the China-Laos Railway, China-Thailand Railway, and Jakarta-Bandung High-Speed Railway, as well as roads, ports, airports, and bridges. These projects not only provided a vast demand space for Chinese technological products in neighboring markets but also drove regional economic cooperation and the integration of industrial technologies within the region.

At this stage, the U.S. government’s containment strategy towards China is not limited to areas where Chinese technology is mature. The “technological fulcrums” that China seeks to breakthrough U.S. technological containment in neighboring countries, as discussed in this article, are focused on this aspect. How China uses the BRI platform to break through U.S. containment in technological fields where it has not yet gained an advantage is a direction for future research. Additionally, how to involve third-party partners and avoid potential risks in technological cooperation in the surrounding region are also directions for continuous in-depth study.