Opportunities

Soldiers of the Chinese PLA

China’s expanding presence presents clear challenges. It also creates opportunities for Australia and its partners to shape the regional environment, strengthen relationships and reinforce resilience. Those opportunities aren’t about confronting China directly, but about shaping the environment in which it operates. They’re about strengthening the ability of regional states to make sovereign choices, raising the costs of coercion and ensuring that no single power can dominate the Indo-Pacific.

This reflects a broader reality: competition with China will be enduring. The task isn’t to avoid competition but to manage it over the long term. Australia’s approach in recent years has increasingly reflected that logic. While pursuing a policy of stabilisation with Beijing, senior ministers have also openly acknowledged the reality of strategic competition and the need to strengthen deterrence, deepen regional partnerships and build collective resilience. For Australia and its partners, that requires a sustained strategy of engagement, coordination and investment across multiple domains.

Strengthening regional partnerships

Demand for security cooperation across the Indo-Pacific is growing. PICs, Southeast Asian states and Indian Ocean partners are seeking support to manage maritime security, protect sovereignty and build resilience. Most aren’t looking to align with China, but to preserve their agency and expand their options.

Australia and its partners have increasingly responded to that demand through expanded security cooperation, capacity-building initiatives and deeper regional engagement. Those efforts provide a strong foundation for like-minded powers, including regional littoral states, to further strengthen a regional order that’s rules-based, non-hegemonic and stable.

But sustaining and expanding those partnerships will be essential to ensure that regional states retain the ability to make sovereign choices free from coercion. In the face of rapid change, middle powers will need to be bold and work together in flexible and reinforcing ways.

Expanding maritime domain awareness, supporting regional policing and coastguard capabilities and deepening defence cooperation will be central to those efforts. Australia, Japan, India and other partners are already investing in many of those areas, but there remains significant scope to build greater capacity and coordination across the region. Such efforts are most effective when framed as supporting sovereignty and regional priorities, rather than as elements of strategic competition.

Defence and security cooperation should also be closely coordinated with other assistance packages. China doesn’t wield influence through security means alone. Ensuring that defence and diplomatic efforts are mutually reinforcing will be critical to strengthening regional resilience and helping Indo-Pacific states navigate intensifying strategic competition on their own terms.

Strengthening regional frameworks

China’s expanding presence is prompting greater alignment among regional states. Shared concerns about maritime security, sovereignty and stability are creating new opportunities to strengthen regional frameworks and expand multilateral cooperation.

There’s a unique opportunity to build a more networked regional architecture—one that deepens cooperation and strengthens regional agency. Minilateral groupings, issue-based coalitions and flexible coordination mechanisms can complement formal institutions, allowing partners to align where their interests converge.

For Australia, that means continuing efforts that deepen engagement with Southeast Asia and Pacific as well as Indian Ocean partners in ways that reinforce regional institutions rather than bypass them. Supporting the resilience and effectiveness of those institutions, particularly in areas such as maritime governance, legal frameworks and crisis response, will be important.

Enhancing presence, access and denial

A more contested environment increases the value of presence. Regular military deployments, joint exercises and coordinated operations build familiarity, strengthen partnerships and demonstrate commitment. For Australia, that includes strengthening its surveillance posture, increasing naval and air activity and expanding access arrangements with regional partners.

However, presence alone is insufficient. The strategic effect of military activity lies in the combination of presence, access and denial. Access agreements, logistics networks and forward operating arrangements enable sustained operations, while the ability to constrain adversaries’ freedom of action reinforces deterrence.

Interoperability between partners, such as Australia, Japan, India and the US, remains a central priority. Such efforts do more than signal capability. They shape operational realities, improve the ability to operate in complex environments and contribute to a balance in which coercive actions become more difficult and costly.

Investing in resilience

China’s grey-zone activities highlight vulnerabilities in infrastructure, supply chains and information systems. Addressing those vulnerabilities is both a defensive necessity and a strategic opportunity.

Resilience must be understood broadly. It includes not only undersea cables, energy flows and critical infrastructure, but also governance frameworks, legal systems and information environments that are resistant to external pressure. Strengthening those systems reduces exposure to coercion while reinforcing national sovereignty.

This isn’t solely a domestic task. Supporting resilience in regional states, through capacity building, technical assistance and institutional partnerships, can build trust and reinforce stability across the Indo-Pacific. Effective competition will require integrating defence and security efforts with economic, technological and informational tools.

Security has never been solely about the military domain. A comprehensive understanding of national security must encompass the full range of government activity and national capability, from infrastructure investment and development assistance to digital standards, economic resilience and secure supply chains. Building resilience across those domains strengthens the capacity of states to withstand coercion and make sovereign decisions in an increasingly contested strategic environment.

Competing through economic and technological statecraft

China’s influence is also shaped by its role in infrastructure development, technology ecosystems and regional economies. Those domains create long-term patterns of dependence that can translate into strategic leverage and, in some cases, create conditions that support Beijing’s future security and military objectives.

Australia and its partners have increasingly recognised the importance of such domains. Initiatives such as the Australian Infrastructure Financing Facility for the Pacific, alongside growing cooperation with Japan, the US and other partners on infrastructure financing, digital connectivity and economic resilience, demonstrate an expanding effort to provide credible alternatives. Those initiatives help to shape the strategic environment over the long term. Building public understanding of why infrastructure financing, economic resilience and technology partnerships matter is therefore an important part of strategic competition. Those investments aren’t simply development projects; they’re instruments for supporting sovereignty, strengthening resilience and preserving a regional order in which states retain the freedom to make their own choices.

Shaping regional norms

As China’s activities become more persistent, the importance of norms and rules increases. Upholding freedom of navigation, transparency in security agreements and respect for sovereignty will be central to maintaining stability.

However, norms aren’t self-sustaining. They must be reinforced through consistent practice, sustained presence and, where necessary, collective pushback. Australia and its partners already play an important role through active diplomacy, support for international law, freedom-of-navigation activities, regional institutions and practical cooperation. Those efforts help to preserve the conditions that have underpinned regional stability for decades, ensuring that disputes are managed peacefully, sovereignty is respected and no single power can unilaterally dictate the rules of the region.

Supporting organisations such as the Pacific Islands Forum, and deepening engagement with Southeast Asian and Indian Ocean partners, will be critical to ensuring that regional norms remain relevant and resilient in a more contested environment. Building public understanding of why those efforts matter is also important. Investments in diplomacy, regional institutions and international partnerships can sometimes appear less tangible than defence spending or infrastructure projects, but they play a vital role in shaping the strategic environment, strengthening regional agency and reducing opportunities for coercion.

Conclusion

China’s presence is growing, but its impact isn’t predetermined. The regional environment will be shaped by how states respond. For Australia and its partners, that requires sustained engagement, clear priorities and a willingness to compete across security, economic and political domains.

The objective isn’t to exclude China, but to ensure that its growing presence doesn’t translate into dominance. That will require managing long-term strategic competition, strengthening resilience, building coalitions and reinforcing a regional order in which all states retain the ability to make independent choices.

In this context, competition and cooperation aren’t mutually exclusive. Managing both, simultaneously and over time, will define the rest of the Indo-Pacific century.