With Donald Trump back in the Oval Office, U.S. global leadership is at a crossroads. While attention has often focused on Trump's more populist remarks, such as suggesting Canada become the 51st state or exploring the purchase of Greenland, the larger picture highlights a more pressing concern: the Indo-Pacific. But whether Trump can alter the dynamic to restore the U.S. as the supreme power in this region remains to be seen.
Currently, America's global dominance is passing through unprecedented strain, driven by the world's unmistakable shift toward multipolarity and its own internal challenges. Emerging powers, especially China, are gradually reconstructing the international system and testing the stability of the American hegemony.
The Indo-Pacific – a key driver of economic growth, accounting for 60% of the world's GDP and containing globally critical trade routes – is home to four of the largest economies. Its emerging markets are reshaping modern global trade patterns and have become the primary theater for geoeconomic and geopolitical contests. For the United States, prioritizing this region is not merely strategic – it is imperative for maintaining its leadership in the 21st century. Any slippage in the U.S. involvement could have far-reaching implications for the U.S. growth. Hence, the legacy of Joe Biden, marked with significant shortcomings and gaps in the region, needs to be addressed immediately and substantially improved.
In his first term, Trump made some important steps to bring focus to the Indo-Pacific region. His team inked several key policy documents that put the region at the center of the U.S. foreign policy strategy and pioneered the formal adoption of “Indo-Pacific” as a defining narrative in U.S. foreign policy, marking a clear strategic refinement of Obama's “Indo-Asia-Pacific.”
Nevertheless, since then, America's leverage in the region has diminished. The statistics back up this notion. The U.S. remains an active player in military presence and foreign aid especially in Southeast Asia, albeit lagging behind China in terms of investment volume. This is evidenced by the 375 000 U.S. military troops and the 800 military bases across the area. From 2015 to 2022, the United States gave $9.9 billion to the region, which is a considerable amount, but small compared to China's $53.6 billion investment. For the same period, the level of U.S. foreign direct investment (FDI) to the region has remained low. The total FDI of the American firms in Southeast Asia composed $156 billion, significantly lower than China's $218 billion. This has given China the economic leverage Beijing requires to cement its strategic role in the region as the economic powerhouse, entrenching itself even tighter to other important players.
As of now, China has emerged as the leading trading partner with most of the countries in the region displacing the U.S. China's Belt and Road initiative (BRI) has invested more than $1T in infrastructure globally, and the Indo-Pacific is one of the key focus areas for these investments. In an attempt to regain ground, the U.S. launched the Indo-Pacific Economic Framework (IPEF) in May 2022. The IPEF was designed to increase economic cooperation and provide collaboration in trade, supply chains and climate policy but certain financial obligations under this umbrella were not disclosed and therefore the effectiveness of the framework is questionable.
On the defense-and-security front, the U.S. Department of Defense has redoubled its attention to the Indo-Pacific. The region was described as a “decisive year” regarding implementation of the U.S. defense plan for 2023. It had included a restructuring of force posture in the region, strengthening partnerships and deploying advanced technology to offset Beijing's expanding military footprint. The U.S. allocated $886 billion on defense in 2024, with most of this funding directed towards the region's presence. Proposals for increasing the scale of troops stationed in the Philippines and Japan, as well as for increasing the funding of promising developments, such as hypersonic missile systems, were intended to preserve a favorable balance of power. However, all this is achieved at a high price, given the current national debt of the U.S. is more than $36 trillion.
Trump's “America First” approach, often a polarizing force in its domestic and foreign impact, has nevertheless achieved a rare degree of bipartisan support – particularly when it comes to Indo-Pacific and competition with China. Trump may crow about his “very good” phone calls with Chinese leader Xi Jinping, but the contemporary geopolitical reality is that competition – especially with China – comprises the heart of modern U.S. foreign policy, and will remain a fundamental component for the foreseeable future.
The ongoing threat posed by China in the Indo-Pacific, in many respects and particularly with regard to Taiwan, would be one of the key factors propelling U.S. offensive policy. As tensions in the region rise, Trump would have to strike a balance between the United States' relationship with China and its commitment to Taiwan to avoid military outcomes of potential escalation. Marco Rubio, U.S. newly appointed Secretary of State, has warned that there will be a Taiwan crisis before the end of the decade. This looming scenario heightens the stakes for Trump, making his strategic approach to the region even more consequential, compelling to elevate security and military policies in it.
Promoting the Quadrilateral Security Dialogue (Quad), which was revived during Trump's first term, and developing security ties like AUKUS would be critical. A clear indication of this priority came on January 21, 2025, when as Secretary of State, Marco Rubio had his first meeting with his counterparts from the Quad countries of Australia, India and Japan. This meeting can be considered as the first clear step in the development of the Trump administration's foreign policy as regards to the reinforcement of security cooperation in the Indo-Pacific region.
To that list, growing effective bilateral relations with regional counterparts would also be another vital focus area. Trump's bargaining abilities may be applied to solidify cooperation with regional partners, especially with India, Japan, Australia, and others. In addition, diversification of relations, the further exclusion, and the minimization of the degree of interdependence with China would be among the top activities.
Another essential component for reclaiming the leadership in the region would be economic re-engagement. To regain American dominance in the region the Trump administration might seek to enter into new trade deals. Facing China's BRI and RCEP, Trump can start from reactivating some aspects of the TPP or improving the efficiency of the IPEF. This could help guarantee that the American economy is being placed in the center of the Indo-Pacific region where 28% of America's exports are sourced. Without a well-established, effective, and comprehensive economic framework, any attempts of Trump to dominate in the Indo-Pacific is doomed to fail.
All mentioned above wouldn't be effective without seeking technological superiority. Therefore, the U.S. might raise its bet on the development of new breakthrough technologies like artificial intelligence, quantum computing and clean energy sources. This might further strengthen America's competitive edge in the technology race, an area in which China has increased its development during the past ten years.
Lastly, soft power would be given due consideration as a colossal weapon in America's policy for exerting influence on other countries. In order to foster goodwill and collaboration among the people in the region, Trump's government might continue to expand cultural, educational and scientific exchanges.
In addressing the Indo-Pacific, the biggest challenge for Trump is to find ways to meet both foreign and domestic needs as the region requires significant attention and substantial resources. Therefore, it seems that military presence, economic re-engagement, strategic investments, partnerships, and clear vision for America's role in the region will still be the core of Trump's policy reset. To simplify this objective, Trump may try to focus on maintaining a flexible strategic environment, ensuring adaptability while preserving U.S. influence and securing its long-term interests.
