Chinese Economic Statecraft in Southeast Asia and Its Uneven Impact in Laos and Cambodia

Abstract

This paper examines how China has successfully translated its economic might into political clout in Laos and Cambodia. The country’s role as a major trading partner, foreign investor, and provider of aid to both countries has contributed substantially to their national development. This massive influx of Chinese investment and aid has also yielded positive results, as both countries have demonstrated a more accommodating attitude toward Beijing on a variety of issues. However, Chinese economic statecraft has had differing degrees of influence on the foreign policymaking of Laos and Cambodia, particularly with regard to their foreign policies toward Vietnam, a critical secondary state in Southeast Asia. While Cambodia has been less hesitant to bandwagon with China, Laos is still seeking to balance between China and Vietnam. This paper argues that Laos and Cambodia’s existing perceptions of Vietnam dictate in part how they respond to China’s economic inducements and affect the outcomes of Chinese economic statecraft.