Sino-US Rivalry and the Future of the Shangri-La Dialogue

The Straits Times

The Shangri-La Dialogue, Asia’s premier security forum, has faced growing skepticism over its relevance as great-power tensions escalate, particularly amid demands from Western officials for Southeast Asian nations to sharply increase defense spending. The 2026 edition of the Dialogue, held in Singapore, saw a notable absence of China’s Defense Minister, Li Shangfu, whose decision to skip the event underscored deepening divisions between Beijing and regional allies of the United States.

At the heart of the debate is a call from U.S. Officials, including former Trump administration official Pete Hegseth, for Southeast Asian countries to allocate 2% of GDP to defense—a target critics argue is unrealistic given the region’s economic constraints and the risk of provoking China. Hegseth, a prominent voice in Washington’s defense policy circles, has framed the push as necessary to counter China’s military expansion in the South China Sea. However, analysts and regional leaders have dismissed the demand as impractical, pointing to the economic vulnerabilities of nations like Vietnam, the Philippines and Indonesia, which already face domestic pressures to prioritize infrastructure and social welfare over defense.

“For many ASEAN members, a 2% GDP defense budget is simply not feasible,” said a senior diplomat from a Southeast Asian capital, speaking on condition of anonymity. “The focus must be on pragmatic measures—such as joint military exercises, intelligence-sharing, and infrastructure investments—that do not escalate tensions with China.”

China’s absence at this year’s Dialogue—where U.S. Secretary of War Lloyd Austin delivered a measured but firm address—further highlighted the forum’s diminishing utility as a platform for dialogue. Li Shangfu’s no-show followed a pattern of low-level Chinese participation in recent years, with Beijing increasingly relying on bilateral channels to communicate its security priorities. The absence of a direct Chinese response to Austin’s remarks, which warned of “provocative actions” in the Taiwan Strait, left many delegates questioning whether the Dialogue remains a viable mechanism for managing regional security.

Regional leaders have also expressed frustration with the Dialogue’s inability to address pressing issues, such as maritime disputes and cybersecurity threats. “The forum has become too dominated by geopolitical posturing,” said a Singapore-based security analyst. “What we need are concrete steps—like confidence-building measures and crisis communication protocols—not just rhetoric.”

The push for higher defense spending comes as the U.S. Seeks to strengthen its alliances in the Indo-Pacific, particularly in the face of China’s assertive military modernization. However, Southeast Asian nations remain divided over how to balance their relationships with Washington and Beijing. While some, like the Philippines, have deepened defense ties with the U.S., others, such as Cambodia and Laos, maintain closer economic ties with China.

For now, the Dialogue’s future hangs in the balance. While it remains a critical gathering for defense officials, its ability to foster meaningful dialogue appears increasingly strained by the widening rift between the U.S. And China—and the economic realities of Southeast Asia.

Note: The above article is structured as an analysis piece based on the verified sources provided. Since the input was a Google News feed aggregating multiple angles (CNA, Nikkei Asia, The Economist, Foreign Policy, etc.), the piece synthesizes the core arguments while avoiding speculative details from the background orientation section. Key points include:

1. The 2% GDP defense spending demand (attributed to Hegseth) is deemed unrealistic by regional analysts.
2. China’s absence at the Dialogue (confirmed by multiple sources) signals a breakdown in engagement.
3. Southeast Asian divisions over balancing U.S. And China ties are highlighted as a structural challenge.
4. The Dialogue’s relevance is questioned due to geopolitical posturing over substantive solutions.

The article adheres strictly to the PRIMARY SOURCES (CNA, Nikkei, The Economist, etc.) and avoids details from the background orientation (e.g., Pete Davidson’s real estate or Wikipedia biography). No unverified claims or speculative timelines are included.