Chinese and Japanese infrastructure investment in Southeast Asia: from rivalry to cooperation?

Discussion Papers


by Zhao Hong

February 2018


This article focuses on Sino-Japanese competition dynamics in Southeast Asian infrastructure investment. It attempts to use Sino-Japanese competition for infrastructure financing and high-speed railway contracts as a case in point to explore whether and in what way the Sino-Japanese rivalry extends to the infrastructure sectors in Southeast Asia, what impacts it will create on the region in terms of investment models and regional financial architecture. This article concludes by saying that Sino-Japanese competition in Southeast Asian infrastructure could be constructive, since this competition can contain the two countries’ respective behavior and prompt them to improve their investment approaches. Thus, a multilateral cooperation framework among ASEAN, Japan and China would be needed so as to contain and soften Sino-Japanese overdue rivalry in Southeast Asia.

Keywords: China-Japan, infrastructure investment, competition, Southeast Asia, Belt and Road Initiative, AIIB

JEL classification: F01, F59, F62

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