America’s new alliance with the United Kingdom and Australia, the AUKUS agreement, marks an important change in the balance of power in the Indo-Pacific region and has led to much hand-wringing over its consequences. Some observers worry that AUKUS will only provoke China to retaliate against the US and its allies and so lead to more tensions in the region. Others are concerned that it will spark off a spiral of ever-increasing and ever more wasteful military spending, resulting in the deployment of dangerous new weaponry. Worse still, with the US and China eyeing each other more antagonistically, it is hard to envisage the two cooperating together to face global challenges such as climate change.

No one should downplay the risks, which are real enough. However, it is necessary to look at the whole picture which would include two sets of positives. The first is a better balance of power in the Indo-Pacific which will deter either big power from making mischief and secondly, it could surprisingly yield a number potential economic benefits. Taking these into account, it could even be argued that the smaller countries in the Indo-Pacific may be better off as a result of this new alliance.

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