America’s strategic deficit in the Asia–Pacific region was in plain sight during the recent Shangri-La Dialogue in Singapore. Although North Korea was a key concern for all participants, many—especially those from Southeast Asia and Australia—found China’s strategic intention a more serious long-term challenge than North Korea’s nuclear weapons and missiles program. But this year, with the new Trump administration in Washington, they couldn’t count on the US to alleviate their anxiety.

In his keynote speech ^[1] to the conference, Australian Prime Minister Malcolm Turnbull delivered a stark warning to China that it would face an opposing regional coalition should it ever want to impose its own version of the Monroe Doctrine in Asia. As my ANU colleague Professor Hugh White points out ^[2], Turnbull ‘has threatened China with Cold War-style containment.’ And ‘no regional leader—not even Japan’s bellicose PM Shinzo Abe—has ever gone this far before.’

The threat won’t go unnoticed in Beijing. But Chinese officials will do well to appreciate the stark but nonetheless subtle nature of the speech. The speech reflected Turnbull’s suspicion and even fear of China’s strategic intentions, but also gently conveyed his scepticism of the Trump administration’s strategic commitment to Asia when he declared: ‘In this brave new world we cannot rely on great powers to safeguard our interests.’

Thus, contrary to White’s interpretation ^[2] that Turnbull ‘has sided with America against China in the starkest possible way,’ Turnbull’s speech in fact reflected mistrust of both China and the US. Of course, the mistrust of China is much deeper than that of the US, but the mere fact that an Australian leader has issued a clarion call to regional leaders about the need to protect their interests by their own efforts rather than relying on the great powers indicates an important shift in regional strategic trends.

Because of the unreliability of the American commitment, Australia—historically a staunch ally of the US—is now suggesting new hedging efforts by working with other countries to shape the region’s strategic future. China will have no illusions about Australia bandwagoning ^[3] with it, but it has good reason to believe that, with hedging now a possibility for Australia, a crack has opened in the Australia–US alliance, owing in no small part to the unpredictability and unreliability of American foreign policy under the Trump administration.

Given the new regional anxiety about both China and the US, US Defense Secretary James Mattis’s affirmation ^[4] of US strategic commitment to the region doesn’t surprise China. Mattis’s speech is so close to the American strategic mainstream that it’s almost indistinguishable from the Obama administration’s approach to Asia. It’s easy for Chinese observers to conclude that the Trump administration has still not figured out its own Asia strategy.

Chinese elites will also note two vexing dilemmas facing Mattis, now the leading strategist of the Trump administration. First, to what extent does his Asia policy represent Trump’s? Trump has so blithely undercut ^[5] his high officials in key foreign policy matters—most recently over NATO and Qatar—that one wonders whether Mattis was really presenting only his preferred Asia policy, rather than the Trump administration’s settled one. If Trump’s transactional foreign policy is only about American self-interest, why would he bother about protecting a somewhat elusive ‘rules-based order’—a key part of America’s strategic commitment to the region? In any case, Trump never seems to have used concepts like the ‘rules-based order’ or ‘strategic commitment’.

Because of those uncertainties, Mattis faces the second major problem in his attempt at strategic reassurance: regional countries don’t buy it. The credibility of American commitment is now a major problem for the US position in Asia—a problem that skilful Chinese diplomacy may exploit.

But will China be able to successfully take advantage of America’s strategic deficit in the region? An opportunity has presented itself, but Chinese elites may also be taken aback by profound regional suspicions of China’s strategic intentions, represented most starkly in the Turnbull speech. It’s also a surprise that the South China Sea was still a key focus of this year’s conference despite the greater urgency of the North Korean problem. Since late last year, Beijing has been betting that the South China Sea has calmed down. The agreement ^[6] on the framework text of a code of conduct for the South China Sea reached with 10 ASEAN countries on 18 May gives it more reason to believe so.

The stubbornness of the South China Sea problem underscores the dynamic strategic currents of the region. While widespread regional anxiety about the Trump administration presents a strategic opportunity for China, China must also try hard to alleviate regional concerns about its intentions, now largely focused on its strategy towards the South China Sea, especially island building. The US has a strategic deficit in the region; so does China. Reassurance is a strategic task for both countries.

Both China and the US are now sources of regional anxiety; their perceived unreliability is prompting regional countries to seek new strategic ‘self-help’ initiatives. For the US, such attempts signal the decline of its influence. For China, they suggest regional suspicions that, if not well managed, may lead to new forms of regional coalitions seeking to check Beijing’s rising influence even without the US. It will be a test of China’s diplomatic skills to manage those suspicions and navigate the emerging strategic trends.