US-CHINA RIVALRY DOMINATES ASIA-PACIFIC

In 2026, intensifying US-China rivalry shapes Asia-Pacific geopolitics, with competition over maritime routes like the Malacca Strait, Taiwan, and disputed islands in the South China Sea driving regional security risks. The US bolsters alliances with Japan, South Korea, the Philippines, and Taiwan to counter China's militarization, while Japan and Australia formalize defense ties including submarine deals to offset diminishing US presence. Trade dynamics shift as US tariffs prompt China to diversify exports to ASEAN, Europe, and Africa, boosting Southeast Asia's manufacturing role and AI-related semiconductor flows from Taiwan and South Korea. Strategic control of sea lanes and resources remains pivotal, fueling territorial tensions and economic reorientation amid long-term tech and mineral access battles.