By Bryanna Entwistle and Juliet Lee
Editor’s Introduction: Hi there. In our last issue of Asia Policy Brief for 2025, we provide an end-of-year review of our newsletters on Asia-Pacific policy issues—informed by ASPI’s experts from around the world. Please stay tuned for what’s ahead in 2026 and wishing all a restful holiday season and a healthy New Year. Thank you for subscribing to ASPI on Substack!
State of Affairs: 2025 Was No Easy Year for Asia
Countries across the region navigated a tumultuous first year under President Trump’s second term in office, which was capped off by a trip to the region in October. Threats of “reciprocal” tariffs strained ties with longtime allies and partners alike, forcing governments like Tokyo, Seoul, and New Delhi to enter trade negotiations with the U.S. and navigate new phases in respective bilateral relations. China was subject to some of the steepest tariffs for the U.S. and spent the year juggling escalations in the trade war with deepening demographic and economic strains at home. Still, Chinese President Xi Jinping was able to further consolidate his grip on power at forums like the Fourth Plenum. In Southeast Asia, border fighting between Thailand and Cambodia escalated into an all-out war, testing ASEAN mediation abilities as it navigated other challenges like a proliferation of scam centers, a surge in exports from China, and a civil war in Myanmar.
Across Asia, several countries experienced leadership transitions, with some, like Nepal, resulting from youth uprisings and others, like South Korea, from impeachment and snap elections. AI adoption emerged as a significant policy priority for the region, as did adapting to and addressing the worsening climate crisis. Throughout it all, Asia Society Policy Institute’s experts helped unpack developments across the region.
Why It Mattered: ASPI Addresses Major Policy Challenges in the Region
Starting in June, ASPI began to use Substack as a method to deliver timely analysis straight to subscribers. Below are our takes on some of the important stories to emerge from Asia in the second half of 2025.
On Trade and Technology:
As President Trump’s initial 90-day deadline for trade talks with the U.S. approached, we explained why the U.S. securing full-fledged deals with trading partners by the deadline was unlikely.
We also wrote about how a lack of progress on trade negotiations between the U.S. and India was testing bilateral ties. A key source of friction is India’s continued imports of Russian oil, and ASPI experts explained why New Delhi is unlikely to curb its relations with Moscow anytime soon in an edition of Asia ASAP, dedicated to unpacking President Vladimir Putin’s December visit to New Delhi.
The pursuit of “AI sovereignty” across Asia presented challenges in 2025, but we argued that regional frameworks provide unique opportunities for Southeast Asia’s technical agency.
On Security and Diplomacy:
Following a devastating terror attack in Kashmir earlier in the year, deadly fighting broke out between India and Pakistan. We explained why the ceasefire was unlikely to bring about lasting peace and how the conflict reflected a recalibration of strategic alignment from both sides.
Our experts took stock of the state of U.S. alliance relations with Japan and Korea in light of Trump’s tariffs and his renewed emphasis on burden sharing, analyzing South Korean President Lee Jae Myung’s visits to Tokyo and Washington and prospects for improved trilateral U.S.-Japan-ROK relations.
Asia saw a wave of consequential leadership transitions in 2025. In Thailand, as fighting intensified along the Thai-Cambodian border, a leaked phone call between Prime Minister Paetongtarn Shinawatra and Cambodian strongman Hun Sen precipitated her ouster. In Japan, the resignation of Prime Minister Shigeru Ishiba opened the door for Tanae Sakaichi’s election, but not without drama that briefly threw her bid into flux.
As countries re-evaluated relationships with the U.S, multilateral gatherings became key venues for middle power engagement. This year’s G20 convening highlighted the promise of multilateralism, even without the U.S.’ presence. But Trump’s presence at the ASEAN summit still commanded attention.
On Climate Resilience:
China’s new climate targets drew scrutiny after a cautious NDC announcement in September, but we explained how Beijing has become the world’s clean energy powerhouse and should not be counted out as a leader in climate action.
Following COP30 in Belem, Cyclone Ditwah caused catastrophic destruction and loss of life in South and Southeast Asia. We broke down how the urgency to adapt is rising faster than the ability of vulnerable countries to keep pace in addressing severe climate impacts.
On China and Cross-Strait Relations:
Over the summer, Taiwan’s leader Lai Ching-te attempted to recall opposition legislators and had plans for a U.S. transit on the way to Latin America reportedly cancelled by Washington. We explained how these events were likely to complicate U.S.-Taiwan ties and broader cross-Strait relations.
When Presidents Trump and Xi Jinping met in Busan in October, ASPI experts provided both rapid and long-form analysis of the summit, which they believed helped stabilize the bilateral relationship by turning down the temperature on recent escalatory trade measures.
What to Watch: Looking Ahead to 2026 and Beyond
China 2026: Using ASPI’s Center for China Analysis’ unique “inside-out” approach to independent, policy-relevant analysis, this third annual flagship report forecasts the most critical developments to watch in China during 2026 and beyond. Across the report, CCA experts agree that “China in 2026 is ascendant yet constrained, powerful yet fragile, ambitious but anxious.”
The Ballot Box: Why Elections in Matter for Asia: To understand election results out of Nepal, Bangladesh, Myanmar, and Thailand in the year ahead, keep an eye on our Ballot Box hub. As the world rapidly changes, Asia stands at a critical crossroads in global leadership.
APEC Cloud Transformation Initiative: Cloud computing has the ability to transform economies and is expected to be a central part of the conversation when APEC is held in China next year. Our trade team will continue to highlight key challenges, share best practices, and support APEC economies in the lead up to APEC 2026 as they work to accelerate cloud adoption.
AI Impact Summit: As India gears up to host the AI Impact Summit in February, our AI team has and will continue to provide analysis of and recommendations for AI adoption across Asia. Check out the readout from an official pre-event summit ASPI Delhi convened to discuss India’s recent announcement of Digital Data Protection Act Rules and AI Governance guidelines.
Dive Deeper with ASPI:
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Check out “PLA Watch” from our Center for China Analysis. Drawing from primary Chinese-language sources, the monthly newsletter tracks the People’s Liberation Army (PLA), its activities, strategies, and evolving capabilities.
Listen to Asia Inside Out, our flagship podcast, on your favorite listening platform. Each month we bring together ASPI experts and outside guests to take you beyond the latest policy headlines and provide an insider’s view on regional and global affairs.