EU trust rises in Southeast Asia but strategic gaps persist

Southeast Asia's view of the European Union has improved for the sixth year running, yet the gap between the bloc's reputation and its diplomatic heft remains wide. The latest State of Southeast Asia survey, published this week by the ISEAS-Yusof Ishak Institute in Singapore, finds that 37.7% of respondents across the ten ASEAN member states now name the EU as the region's preferred "third party" to hedge against US-China rivalry, up from 36.3% in 2025. Trust that the EU will "do the right thing" for global peace, security and prosperity rose to 55.9% from 51.9%, while outright distrust fell to 22.3% from 27.8%.

A hedge by default rather than design

The numbers tell a story of a region looking for insurance. With the United States under Donald Trump pursuing what the survey identifies as the top geopolitical concern, "unilateral and unpredictable foreign policy", and China's economic gravity only deepening, Southeast Asian capitals are not so much embracing the EU as reaching for the least risky alternative. Hunter Marston of the Center for Strategic and International Studies put it bluntly: Trump's approach "only made it more clear to the EU and Southeast Asian countries that they should diversify ties and do so quickly."

That logic cuts both ways. The EU is ASEAN's third-largest trading partner, after the United States and China, and its second-largest source of foreign direct investment. Free trade agreements are in force with Singapore and Vietnam; negotiations concluded last year with Indonesia, Southeast Asia's largest economy. Talks continue with the Philippines, Malaysia and Thailand, which Brussels treats as stepping stones toward an eventual region-to-region deal. Yet trade, as Melinda Martinus notes, is where the EU's influence is most tangible. Beyond commerce, the bloc's strategic weight remains thin.

Indonesia's outlier status

The survey's most striking anomaly is Indonesia. It was the only ASEAN country where distrust of the EU outweighed trust over the past year. Even so, 40.7% of Indonesian respondents still selected the EU as the preferred third-party hedge, a higher share than the regional average. The contradiction reflects Jakarta's specific grievances, notably over the EU's deforestation regulation and palm oil restrictions, which Indonesian officials have repeatedly called discriminatory. Yet it also underscores a broader pattern: Southeast Asian governments can be simultaneously critical of EU policies and reliant on the EU as a diplomatic counterweight.

Normative appeal, strategic absence

The EU's strongest asset remains its association with international law, multilateralism and climate leadership. Alfred Gerstl, who studies Indo-Pacific relations at the University of Vienna, argues that as the world's two most developed regional organisations, the EU and ASEAN have a "strong incentive to collaborate more closely to defend the rules-based order." The survey bears this out: 19.2% of respondents saw the EU as the main champion of global free trade, ahead of the United States, though behind ASEAN itself (28.4%) and China (23.1%). On upholding the rules-based order, the EU placed third behind ASEAN and the United States.

But reputation does not automatically translate into presence. Chris Humphrey, executive director of the EU-ASEAN Business Council, has been vocal about what he calls a pattern of absenteeism. He pointed to the ASEAN digital ministers meeting in Vietnam in January 2026, attended by senior representatives from Washington, Beijing and Moscow, but not by any EU commissioner or senior official. "We're not turning up at the ministerial meetings when others are turning up, and it gets noticed and gets commented on," Humphrey said. "Europe's just not interested."

The 50th anniversary test

Next year marks the 50th anniversary of formal EU-ASEAN relations. For Brussels, it is a scheduled opportunity to demonstrate that its Indo-Pacific strategy amounts to more than rhetoric. Humphrey is among those hoping for a step change: "Europe really does need to step up to the plate more and demonstrate publicly that it takes the relationship seriously, wants to deepen it, and work with ASEAN on areas of mutual interest, of which there are many." The EU-ASEAN Business Council has highlighted energy transition cooperation, particularly support for the ASEAN Power Grid, and deeper digital engagement as concrete areas where senior-level involvement could produce results.

Trade as the anchor, not the sail

The economic relationship is real and growing. EU-ASEAN trade in goods reached €265 billion in 2024, according to Eurostat, with EU services exports adding a further €58 billion. European firms have invested heavily in manufacturing hubs across Vietnam, Malaysia and Thailand as part of supply-chain diversification away from China. But trade agreements are negotiated at a glacial pace: the Indonesia deal took 16 years to conclude, and the Philippines, Malaysia and Thailand negotiations have no guaranteed endpoint. Meanwhile, the Regional Comprehensive Economic Partnership (RCEP), which includes China, Japan, South Korea, Australia and New Zealand alongside ASEAN, entered into force in 2022, creating a tariff framework the EU is not part of.

This matters because Southeast Asian governments increasingly evaluate partners by their ability to deliver market access and technology transfer, not just by their adherence to multilateral norms. The EU's deforestation regulation, which imposes due-diligence requirements on commodities including palm oil, rubber and coffee, has become a flashpoint. Indonesia and Malaysia, the world's two largest palm oil producers, have threatened retaliatory measures and filed a WTO dispute. The episode illustrates how a regulatory tool designed in Brussels for climate purposes can be perceived in Jakarta and Kuala Lumpur as protectionism disguised as sustainability.

Digital and energy: the missing layers

Humphrey's critique of the EU's absence from the January digital ministers meeting points to a deeper disconnect. ASEAN is finalising its Digital Economy Framework Agreement, a region-wide effort to harmonise rules on data flows, e-commerce and cybersecurity. The EU's Digital Markets Act and Digital Services Act are de facto global standards, yet Brussels has no formal dialogue channel at ministerial level with ASEAN on digital governance. Similarly, the ASEAN Power Grid, a long-standing ambition to integrate regional electricity markets and accelerate renewable deployment, has received EU technical assistance but no political champion at commissioner level.

These are not marginal issues. Digital trade and energy transition are where the next decade of economic integration will be won or lost. The EU's regulatory power gives it latent influence, but influence unexercised decays. As one Southeast Asian diplomat put it privately last year: "We read your regulations. We just wish you showed up to discuss them."

A partnership waiting for a strategy

The survey's trajectory is clear: the EU's standing in Southeast Asia is improving because the alternatives are deteriorating. That is a fragile foundation. The bloc's normative appeal, multilateralism, climate leadership, rules-based trade, aligns with ASEAN's own charter principles. But alignment without engagement is a statement, not a strategy. The 50th anniversary in 2027 offers a natural deadline. Whether Brussels uses it to announce a new tier of political cooperation, a regular EU-ASEAN summit at leader level, a dedicated Indo-Pacific commissioner, or simply a commitment to show up at every sectoral meeting, will determine if the trust dividend is spent or squandered.