Global Risk Indexes (12-01-2025)

Global 96 (+1 ▲)
MENA 99 ( —)
APAC 98 (+1 ▲)
Europe 98 (+1 ▲)
Africa 88 (+2 ▲)
AMERs 96 (-2 ▼)
Markets 96 (+2 ▲)
Mei Ling, Asia Pacific region analyst at Worldwise Analytica

Mei Ling

Empowering minds, shaping decisions: Insights from the heart of geopolitics

Asia-Pacific Geopolitics: Strategic Shifts, Economic Realignments, and Leadership Crises Define Regional Volatility

The Asia-Pacific region faced a turbulent week characterized by leadership instability, strategic realignments, and economic challenges that underscore its central role in shaping global geopolitical and economic trajectories.

South Korea's Governance Crisis Weakens Regional Posture: The ongoing impeachment hearings for President Yoon Suk Yeol and the legal standoff surrounding his arrest have deepened institutional fragility. Acting President Choi Sang-mok's efforts to maintain diplomatic and economic stability have been hampered by eroding public trust and investor confidence. With the won depreciating and critical sectors like technology under pressure, South Korea's ability to lead in Indo-Pacific security and economic frameworks has been significantly undermined, creating a vacuum that adversaries like North Korea and China may exploit.

North Korea's Military Provocations and Russian Alignment: Pyongyang's continued missile advancements and reports of North Korean troops gaining combat experience in Ukraine highlight its intent to assert strategic leverage. The deepening military collaboration between North Korea and Russia poses a direct challenge to U.S.-led security architectures in Northeast Asia. This alignment introduces new complexities for regional stability, requiring recalibrated responses from Seoul, Tokyo, and Washington to address an increasingly cohesive adversarial bloc.

China's Dual-Track Strategy: Economic Vulnerabilities and Grey-Zone Tactics: Beijing's struggles with its real estate sector, exemplified by the liquidation petition against Shimao Group, have exposed underlying economic weaknesses. Simultaneously, China's aggressive use of grey-zone tactics, including suspected sabotage of undersea cables near Taiwan and cyber offensives, signals a calculated effort to undermine regional adversaries while diverting attention from domestic challenges. Taiwan's ability to rapidly restore critical infrastructure demonstrates resilience but underscores the need for coordinated regional defenses against Beijing's escalating provocations.

Shifts in Southeast Asia: Balancing Domestic Challenges and Strategic Ambitions: Malaysia's palm oil industry and Indonesia's expansive welfare initiatives illustrate contrasting approaches to addressing domestic pressures amidst global economic uncertainty. Jakarta's focus on maritime security and its role in BRICS reflect its ambition to redefine its geopolitical influence. However, internal fiscal constraints and external trade dependencies could limit its ability to fully capitalize on these opportunities.

Economic Realignments in a Fragile Global Landscape: Taiwan's semiconductor industry, a cornerstone of global technology supply chains, faces growing risks from potential U.S. tariffs under President-elect Donald Trump. Although Taiwan's technological superiority may buffer some impacts, broader trade tensions highlight the region's vulnerability to protectionist policies. Similarly, Malaysia's declining palm oil stocks due to flooding and reduced exports could have long-term implications for its economic competitiveness.

The Asia-Pacific stands at a critical crossroads, where governance challenges, economic adjustments, and strategic rivalries are converging to reshape the regional order. Navigating these complexities will require enhanced coordination among regional powers and proactive global engagement to address systemic risks and sustain stability in one of the world's most volatile arenas.

Geopolitical Risk Assessment for the Asia Pacific
(12-01-2025)

The Asia-Pacific region is undergoing a period of heightened instability marked by systemic governance failures, intensified military posturing, and economic realignments. These intersecting crises reveal significant risks to both regional stability and global power dynamics.

Geopolitical Risk Index

Developments to Follow for the Asia Pacific (See All Global)

Previous Briefings

See all previous briefings