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Time for America to Play Offense in China’s Backyard

Ignoring Cambodia and Laos is a strategic mistake—but engagement requires a smarter balance of values and interests.

By , a senior defense analyst at the Rand Corp.
Cambodian Prime Minister Hun Sen reviews a military honor guard with Chinese Premier Li Keqiang during a welcome ceremony outside the Great Hall of the People in Beijing on May 16, 2017.
Cambodian Prime Minister Hun Sen reviews a military honor guard with Chinese Premier Li Keqiang during a welcome ceremony outside the Great Hall of the People in Beijing on May 16, 2017.
Cambodian Prime Minister Hun Sen reviews a military honor guard with Chinese Premier Li Keqiang during a welcome ceremony outside the Great Hall of the People in Beijing on May 16, 2017. NICOLAS ASFOURI/AFP via Getty Images

As the Biden administration begins its second year in office, it is evident that its focus on the Indo-Pacific and geopolitical competition against China remains uneven. There are two small but strategically important countries that have been all but ignored by the administration so far: Cambodia and Laos. This could be a significant miscalculation.

If the United States were to make inroads in Cambodia and Laos—which observers have likened to vassals, satellite states, or virtual colonies of China—it would take strategic competition into China’s own backyard. Perhaps more significantly, it would help undermine the persistent narrative that the United States is only reacting and playing defense in the Indo-Pacific in the face of China’s all-but-inevitable rise. Even more than the facts on the ground, that narrative is a powerful headwind to U.S. strategy in the region. It sows doubts about U.S. engagement even among long-standing allies such as the Philippines and Thailand.

Stepping up U.S. engagement with Cambodia and Laos—for example, by countering China’s multiple Belt and Road Initiative projects or enhancing U.S. access to Cambodia’s Ream Naval Base—could also reverse what already seems like a fait accompli: that China will dominate, even subjugate, the Southeast Asian mainland. Cooperating with Cambodia and Laos could also strengthen ties with neighboring Thailand and U.S. strategic partner Vietnam, both of which share concerns about China, including its construction of dams along the Mekong River, an economic lifeline for all four countries.

As the Biden administration begins its second year in office, it is evident that its focus on the Indo-Pacific and geopolitical competition against China remains uneven. There are two small but strategically important countries that have been all but ignored by the administration so far: Cambodia and Laos. This could be a significant miscalculation.

If the United States were to make inroads in Cambodia and Laos—which observers have likened to vassals, satellite states, or virtual colonies of China—it would take strategic competition into China’s own backyard. Perhaps more significantly, it would help undermine the persistent narrative that the United States is only reacting and playing defense in the Indo-Pacific in the face of China’s all-but-inevitable rise. Even more than the facts on the ground, that narrative is a powerful headwind to U.S. strategy in the region. It sows doubts about U.S. engagement even among long-standing allies such as the Philippines and Thailand.

Stepping up U.S. engagement with Cambodia and Laos—for example, by countering China’s multiple Belt and Road Initiative projects or enhancing U.S. access to Cambodia’s Ream Naval Base—could also reverse what already seems like a fait accompli: that China will dominate, even subjugate, the Southeast Asian mainland. Cooperating with Cambodia and Laos could also strengthen ties with neighboring Thailand and U.S. strategic partner Vietnam, both of which share concerns about China, including its construction of dams along the Mekong River, an economic lifeline for all four countries.

But so far, the Biden administration’s interactions with Cambodia have been poor and ineffective, while Laos has fallen off the radar screen entirely. Relations with both countries, neither of which is a democracy, have fallen victim to the administration’s priority in its foreign policy on shared values over shared interests. President Joe Biden’s team may also have concluded that Laos and Cambodia are so firmly entrenched in Beijing’s orbit that time and resources would be better spent on countries in the region that are more receptive to and helpful in strategic competition.

These two countries, then, are test cases for whether one of the administration’s priorities—democracy, freedom, and human rights—will undermine another priority: strategic competition with China. These do not have to be mutually exclusive, and there is already an active template for how the Biden administration can keep its eyes fixed on the national interest without entirely giving up on values. When U.S. Secretary of Defense Lloyd Austin visited semi-authoritarian Singapore and Secretary of State Antony Blinken went to increasingly illiberal India last year, each toned down the administration’s public language about democratic values, not least by admitting that the United States has struggled with some democracy issues of its own. Instead of delivering lectures, they made the interaction more of a two-way street. Alternatively, the Biden administration could emphasize the importance of good governance and limiting corruption in Cambodia and Laos—certainly part of the values agenda—rather than tie bilateral interactions only to the state of democracy.

A purely values-based approach has clearly failed to make headway, isolates the United States in the region, and unnecessarily cedes ground to Beijing.

It is noteworthy that the democracy standard has been loosened for other countries—but not Cambodia and Laos. The Biden, Trump, and Obama administrations all consciously chose to downplay values in their relations with neighboring Vietnam, which has a poor and worsening human rights record but is an important piece on the strategic chessboard. Vietnam most persuasively demonstrates that the United States can—when it is willing—juggle values and practical cooperation in the Indo-Pacific.

Admittedly, engaging Cambodia and Laos won’t be easy. In 2019, then-U.S. President Donald Trump exchanged letters with Cambodian Prime Minister Hun Sen in a bid to reset ties. Trump requested that Hun Sen “put Cambodia back on the path of democratic governance” and, in a nod to the Cambodian strongman’s concerns, noted “we do not seek regime change.” Hun Sen responded with a letter of his own. In it, he said, “I am of the view that we should not become hostage of a few dark chapters of our own history. There are so many other beautiful chapters that are worth nourishing for the greater good of both of our countries and people.” Understandably reluctant to undermine his own hold on power, he ignored Trump’s call to return to democracy.

To its credit, the Biden administration has not totally ignored Cambodia, sending two senior State Department officials on separate trips last year. When Deputy Secretary of State Wendy Sherman visited Phnom Penh in June 2021, she discussed the $3 billion in economic development assistance the United States has given Cambodia since the end of its civil war in 1991. They also discussed health and education partnerships, Mekong River issues, and U.S. help clearing unexploded bombs from the Vietnam War. Sherman promised to work with Cambodia when it assumes the Association of Southeast Asian Nations’ rotating presidency in 2022.

But these nods to positive bilateral relations were overshadowed by the negative. Just prior to her arrival, an editorial in a Cambodian state-run newspaper argued that instead of haranguing Cambodia on values, the United States should “further intensify its development cooperation” and “consider encouraging its investors to invest in Cambodia … just like China.” Instead, Sherman met with civil society leaders and criticized Phnom Penh’s human rights and governance record. She also brought up Beijing’s reported plans to build a naval base at Ream in Cambodia, which Hun Sen has consistently denied, and urged his government to curtail China’s outsized influence in the country. Because Sherman underscored the importance of values over practical cooperation, her visit likely pushed Cambodia further into China’s embrace.

U.S. State Department Counselor Derek Chollet, arriving in Cambodia this past December under an even darker shadow, broached the same topics. Washington had just imposed sanctions against two senior Cambodian military leaders, including the head of the navy, for alleged corruption in connection with Chinese construction at Ream Naval Base. Washington also announced a review of Cambodia’s trade privileges—a very significant step, as the United States is Cambodia’s top export destination—and issued an advisory to U.S. businesses to avoid dealing with Cambodian companies involved corruption, crime, and human rights abuses. After Chollet left, Washington issued an arms embargo and banned Cambodian acquisition of dual-use technologies to prevent them from falling into the regime’s or Beijing’s hands.

Contrast Washington’s interactions with Phnom Penh with Beijing’s, and it’s easy to see why Cambodia prefers dealing with China. The two neighbors remain, as their diplomatic statements assure us, “ironclad” in their “brotherhood,” with ever-deepening exchanges on all fronts. A new Chinese-Cambodian free trade agreement, for example, just went into effect, certain to elevate trade. China has greatly assisted Cambodia with vaccine deliveries and other pandemic relief. And Beijing’s Belt and Road Initiative projects are helping economic development, even if these projects also create new opportunities for corruption.

Hun Sen, a staunch ally of Chinese President Xi Jinping, holds the unique distinction of being the only foreign leader to visit Xi since the start of the COVID-19 pandemic. Despite recent Chinese construction activities at Ream, both parties have denied any intent to eventually station Chinese troops there. But it is hard to believe that this denial was genuine, given the details that have come out about this project as well as the Chinese-led runway expansion at nearby Dara Sakor airport, which appears to make it capable of supporting military-grade aircraft.

Laos is even more of a blind spot where the Biden administration has yet to send a senior-level official. By comparison, the Obama administration sent a secretary of state three times—Hillary Clinton in 2012 and John Kerry twice in 2016. Current first lady Jill Biden, whose husband was vice president at the time, visited Laos in an official capacity in 2015.

Most importantly, then-U.S. President Barack Obama landed there in 2016, marking the first time a sitting U.S. president visited Laos. (Obama, in 2012, also became the first and only president to visit Cambodia). His visit, however, was not about strategic calculations; rather, it was born out of a “moral obligation,” as he called it, to address U.S. bombing of Laos during the Vietnam War, during which Laos endured the most bombs per capita ever dropped on a country. During the visit, Obama nevertheless elevated the relationship with Vientiane by announcing a U.S.-Laos comprehensive partnership. The partnership incorporates many different aspects of bilateral exchange and came with $90 million over three years to help Laos clear unexploded U.S. ordinances from the war. Over the previous 20 years, Washington had only given $100 million.

There will undoubtedly be moments that make Washington cringe.

Neither the Trump nor the Biden administrations has shown any interest in capitalizing on Obama’s historic visit. Fortunately, many Obama-era programs continue to thrive below the radar, including economic promotion, legal aid, human trafficking prevention, and English language education, according to recent remarks by the U.S. ambassador to Laos. Most importantly, funding levels for unexploded ordnance removal have remained strong across the Trump and Biden administrations.

China, meanwhile, is building desperately needed infrastructure projects and investing in sectors of the Laotian economy that promise the most growth. A China-Laos railroad line for both passengers and cargo was completed just last month. Beijing has boasted that Chinese tourism to Laos, the only landlocked country in Southeast Asia, is on the rise despite the pandemic. Laos is also reportedly benefiting from new supply chains via rail. China has built multiple dams for Laos across the Mekong River to help Laos generate a surplus of hydroelectric power and become the “battery of Asia.” Beijing insists that none of these projects comes with political strings attached—though that is of course debatable. Even if it’s true, ties of money and corruption can be even more powerful than any formal quid pro quo.

Obviously, China is at an outsize advantage, beginning with its enormous economic clout and immediate proximity. All three countries are authoritarian; Cambodia and Laos thus are less appealing as partners for a Biden administration that prioritizes values. But these are not insurmountable obstacles.

The Biden administration could work in concert with democratic partners, such as Australia, India, Japan, and South Korea, to jointly forge ahead with infrastructure and investment projects in Cambodia and Laos that directly compete against China’s Belt and Road Initiative. The basis for these projects is in place, including Biden’s Build Back Better World initiative and existing trade and investment framework agreements with Phnom Penh and Vientiane that could be built on.

But even within existing parameters, Washington should first make sure to avoid allowing these relationships to worsen further, and it should actively seek cordial and productive ties. Any further sanctions and other punitive measures would clearly be counterproductive. The Biden administration could stay true to its focus on values not by preaching and haranguing but by reframing and repackaging these conversations as it has already done with other countries in the region. A more comprehensive approach to strategic competition might see the Biden administration seeking high-level political exchanges with Cambodia and Laos to facilitate new economic and security agreements, such as the reestablishment of U.S. access to Ream Naval Base. Such an ambitious strategy would probably require a significant tempering of U.S. concerns over values.

Either way, there will undoubtedly be moments that make Washington cringe. Hun Sen has cracked down on opposition groups; last week, he visited Myanmar to meet with the military junta shunned by most other countries. But in the end, upping engagement with Cambodia and Laos can only be a net positive for the United States as it competes against China. A purely values-based approach has clearly failed to make headway, isolates the United States in a region where few countries are true democracies, and unnecessarily cedes ground to Beijing.

Derek Grossman is a senior defense analyst at the Rand Corp., an adjunct professor at the University of Southern California, and a former daily intelligence briefer to the U.S. assistant secretary of defense for Asian and Pacific security affairs. Twitter: @DerekJGrossman

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