U.S. Holds Narrow Power Gap Over China: Asia Power Index

The Australia-based Lowy Institute released its 2023 Asia Power Index, which tracks the ability of 26 countries and territories in the region, along with the U.S. and Russia, to “shape and respond to their external environment.”

A key finding of the report is that while China is increasingly militarily capable, its isolation during the COVID-19 pandemic has atrophied its regional relationships and thereby stalled its progress in closing the power gap with the U.S. While American primacy in Asia is no longer uncontested, the authors say, for now, the U.S. maintains a “narrow if durable edge” over China.  

Japan declining, India under-performing

The Index combines resource-based power, including economic and military capabilities, with influence-based power, such as economic and defence ties and diplomatic and cultural clout. On these scores, there is a vast gulf between the U.S. and China and the rest of the pack.

Japan ranks third, but according to the Index, its power is waning. Its two strongest assets have been the size of its economy and its technological edge. But both are weakening due to Japan’s aging population, shrinking workforce, and lack of investment in developing new technologies. India, in contrast, has a favourable demographic future, but its diplomacy is seen as relatively lacklustre, and it has little power projection beyond its South Asian neighbours.  

Canada outside looking in

Canada is not included in the Index. Nevertheless, the Index’s insights could inform Ottawa’s pursuit of its new Indo-Pacific Strategy. For example, the Index challenges the conventional wisdom of the 10-member Association of Southeast Asian Nations (ASEAN) as a weak centre of gravity in the region, describing it instead as diplomatically dynamic. That will be a welcome insight for Canada, which has identified ASEAN as a key node in its regional engagement.