As the APEC Economic Leaders’ Meeting convenes in South Korea amid heightened geopolitical tensions, Southeast Asia’s systematic shift toward Korean and European defense systems represents a critical challenge to American strategic influence in the region. While the US pursues renewed engagement through expanded defense agreements and strengthened alliances, Seoul’s emerging role as a competitive defense supplier reflects deeper structural changes in regional procurement patterns driven by Southeast Asian preferences for strategic autonomy, cost-effective systems, and comprehensive partnership models that alternative suppliers increasingly offer.

Southeast Asia is quietly executing one of the most significant defense procurement transformations in decades—and the United States is losing. While Washington debates China strategy, America’s traditional defense partners across the region are systematically diversifying away from US weapons systems toward South Korean and European alternatives. This shift represents far more than changing market dynamics. It signals a fundamental realignment that could fatally undermine US military influence precisely when strategic competition in the Indo-Pacific demands stronger partnerships.

The numbers reveal a stark reality. South Korea’s defense exports have exploded from $7.25 billion in 2021 to over $14 billion by 2025, making it the world’s tenth-largest arms exporter. Korean suppliers now dominate Southeast Asian procurement decisions that once automatically went to American companies. Malaysia has purchased 18 Korean FA-50 fighter jets, the Philippines is expanding its Korean aircraft fleet while exploring joint defense production with Seoul, and Indonesia continues deepening its multibillion-dollar defense partnership with Korean suppliers.

This trend carries profound implications that Washington has failed to grasp. Military interoperability, intelligence sharing, and operational coordination—the foundation of U.S. strategic influence—all depend on shared defense platforms and training relationships built over decades of American arms sales. As Southeast Asian militaries adopt Korean and European systems, these foundational linkages face systematic erosion. The United States risks losing its capacity to coordinate regional military responses to Chinese assertiveness precisely when such coordination matters most.

Korea’s Strategic Masterclass

South Korea’s success in Southeast Asia reflects strategic sophistication that puts American defense diplomacy to shame. Seoul offers advanced military capabilities without the political baggage that increasingly accompanies US defense sales. Korean systems provide comparable performance to American alternatives while avoiding the complex approval processes, technology transfer restrictions, and strategic alignment expectations that frequently complicate US defense relationships.

The Korean model is particularly appealing to Southeast Asian countries determined to avoid choosing sides in US-China strategic competition. Korean defense systems allow regional militaries to enhance capabilities without appearing to align explicitly with either major power—a crucial consideration for countries pursuing strategic autonomy. This political palatability, combined with competitive pricing and flexible financing arrangements, has made Korean suppliers increasingly attractive across the region.

Korean suppliers offer technology transfer arrangements and local production opportunities that appeal to countries seeking to develop indigenous defense capabilities—something US companies rarely match due to regulatory constraints and corporate policies. The technical advantages are equally compelling. Korean weapons systems adhere to NATO standards, making integration with existing Western equipment straightforward, while Korean manufacturers offer delivery timelines of 18 months compared to 3-5 years for Western alternatives.

The cost differential is striking. The Korean FA-50 light attack aircraft costs approximately $50 million, roughly half the price of comparable American systems. When Hanwha Aerospace secured a $250 million deal to export 20 K-9 howitzers to Vietnam, it marked Korean artillery’s entry into Southeast Asia and demonstrated Seoul’s systematic approach to market penetration across different weapons categories.

Korean defense diplomacy also leverages comprehensive relationships that extend beyond weapons sales. Unlike America’s increasingly transactional approach, Korean engagement integrates defense sales with economic partnerships, cultural exchanges, and development cooperation. This creates deeper bilateral relationships that make Korean defense partnerships more politically sustainable domestically while offering recipients broader strategic value.

America’s Vanishing Strategic Leverage

The erosion of America’s traditional defense supplier role carries multiple strategic costs that extend far beyond market share concerns. Military interoperability—the ability of different military forces to operate together effectively—depends heavily on shared platforms, training, and doctrine that decades of US arms sales created. As regional militaries adopt different systems, this interoperability advantage faces gradual but systematic erosion.

Intelligence sharing arrangements depend on technological compatibility and trust relationships that shared defense platforms help create and maintain. US intelligence systems often integrate closely with American defense platforms, creating natural channels for information sharing that alternative suppliers cannot replicate. The diversification of Southeast Asian defense procurement complicates these intelligence relationships, potentially reducing American access to critical regional information when understanding Chinese activities becomes increasingly vital.

Training relationships represent another strategic loss. US defense sales traditionally include extensive training programs that bring Southeast Asian military officers to American institutions, creating personal relationships and shared professional experiences that strengthen bilateral ties. As procurement diversifies, these relationship-building opportunities diminish, weakening the human networks that underpin strategic partnerships.

Consider the Philippines, America’s oldest ally in the region. Despite strengthening political ties with Washington under President Marcos Jr., Manila actively pursues defense diversification. Philippine Defense Secretary Gilberto Teodoro has explicitly praised Korean systems as “reliable, cost-effective and capable of multiple roles,” suggesting that performance and value—not strategic alignment—increasingly drive procurement decisions. This represents a fundamental shift from previous decades when alliance relationships heavily influenced defense procurement.

Regional defense spending reached over $50.6 billion in 2024, driven by South China Sea tensions and broader security concerns. However, much of this spending growth benefits non-American suppliers. Korean defense firms secured a $73.1 billion order backlog by the end of 2024, with significant Southeast Asian components, while European suppliers have similarly expanded their regional footprint.

The trend extends beyond major platform acquisitions to encompass maintenance, training, and technological partnerships that traditionally cemented US-Southeast Asian defense relationships. Korean and European suppliers increasingly offer comprehensive package deals that include technology transfer, local production arrangements, and training programs—creating holistic relationships that rival traditional US offerings while avoiding political complications.

Strategic Autonomy Over Alliance Loyalty

Southeast Asia’s defense diversification reflects broader regional responses to intensifying US-China strategic competition. Rather than choosing sides, most Southeast Asian countries prefer maintaining strategic autonomy that allows cooperation with both major powers while avoiding exclusive alignment with either. Defense procurement diversification serves this strategic autonomy by reducing dependence on any single supplier, including the United States.

This pursuit of strategic autonomy creates fundamental challenges for US strategy that extend beyond defense sales. Washington’s Indo-Pacific approach increasingly requires regional partners to take explicit positions in strategic competition with China, but Southeast Asian countries generally prefer avoiding such clear alignment. Defense procurement patterns reflect this preference, with countries seeking suppliers that allow capability enhancement without strategic entanglement.

The regional preference for strategic autonomy also reflects historical lessons about over-dependence on superpowers. Cold War experiences made many Southeast Asian countries wary of exclusive relationships that might limit strategic flexibility. Current procurement patterns reflect these lessons, with countries seeking diverse supplier relationships that preserve maximum strategic options while building modern military capabilities.

European suppliers have capitalized on these preferences by offering technological sophistication without political complications. German naval technologies, Italian aerospace systems, and French missile technologies have found receptive regional markets. European companies emphasize technological partnership rather than simple arms sales, offering research collaboration and joint development opportunities that appeal to countries seeking indigenous defense industrial development.

The cumulative effect represents more than procurement diversification—it signals a systematic regional attempt to balance great power relationships through defense acquisition patterns. Countries like Indonesia, Malaysia, and Thailand pursue what defense analysts term “strategic hedging” through procurement, maintaining relationships with multiple suppliers to avoid over-dependence while building relationships that serve broader strategic autonomy goals.

American responses have proven inadequate to address these underlying dynamics. Recent US initiatives focus on strengthening defense partnerships through enhanced cooperation agreements and joint exercises, but these efforts emphasize political and operational cooperation while failing to address the procurement trends that threaten long-term strategic relationships. American defense companies remain constrained by regulatory frameworks, approval processes, and pricing structures that make them less competitive than Korean alternatives.

The Price of Strategic Complacency

America’s declining defense influence in Southeast Asia coincides with the region’s growing strategic importance. The South China Sea tensions that drive regional defense spending increases also make coordination with regional militaries more critical for effective responses to Chinese assertiveness. Yet as regional militaries adopt non-American systems, the technical and operational coordination that effective responses require becomes more difficult to achieve.

The timing could not be worse for the US. China’s military modernization accelerates precisely when American influence over regional military development weakens. Chinese military activities in the South China Sea require coordinated responses from regional partners, but such coordination becomes more challenging when regional militaries operate different systems with different command structures and communication protocols.

Korean success in Southeast Asia demonstrates that alternative suppliers now offer competitive systems without the political complications that increasingly accompany American defense sales. Regional countries prefer suppliers that enhance capabilities without requiring strategic alignment, and Korean defense diplomacy delivers exactly this combination. The United States cannot afford to lose Southeast Asia’s defense modernization wave to competitors who better understand regional preferences and offer more attractive partnership terms.

The defense procurement revolution in Southeast Asia is not just changing market dynamics—it is reshaping the strategic balance in the Indo-Pacific. American strategic influence, built over decades of defense partnerships, faces systematic erosion precisely when competition with China requires stronger regional coordination. Unless Washington adapts to new realities, America risks strategic irrelevance in one of the world’s most important regions just when leadership matters most.

Image credits: CC0 public domain

Xiaolong (James) Wang
James is a Master of Science in Foreign Service student at Georgetown University specializing in AI and digital governance. Born in China and raised in Singapore, he completed his bachelor degree in Canada. James has worked with the G20 Research Group and the NATO Association of Canada, focusing on global governance, security policy, and multilateral diplomacy.