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27 December 2019

Revolutionizing lng and natural gas in the indo-pacific


The Trump administration’s new “free and open Indo-Pacific” strategy is an evolution and expansion of the Obama administration’s earlier “rebalance” of the United States’ strategic focus toward the Asia-Pacific. At its core, the strategy is a response to the expanding power and influence of China across the region as it rolls out its Belt and Road Initiative (BRI), which is focused on building energy infrastructure and transportation links across Southeast Asia, South Asia, and the Eurasian continent. The concept of the Indo-Pacific developed in the Trump administration’s 2017 National Security Strategy is an ambitious expansion of U.S. strategic and economic interests in the Asia-Pacific to a broader region running all the way from the Strait of Hormuz around to Northeast Asia and the Russian Far East.

From one perspective, the free and open Indo-Pacific strategy is an effort to reshape the U.S. approach to economic statecraft to promote private-sector investment and financing in developing regional economies as a strong alternative to the state-directed approach of China. As Nadège Rolland and others have detailed extensively in their analyses for the National Bureau of Asian Research (NBR), China’s approach often has strings attached and subordinates the economic interests of recipient states to Beijing’s broader strategic and economic interests in an effort to create what some have dubbed an “Indo-Pacific with Chinese characteristics.”


In many ways the U.S. free and open Indo-Pacific strategy is also a mercantilist strategy, aimed at better integrating economic, trade, energy, and investment objectives in order to strengthen Western power and influence to counter China’s own deeply mercantilist approach to the region. Along with important strategic and diplomatic dimensions, a third plank of the Trump administration’s Indo-Pacific strategy envisions a major expansion of trade, economic ties, and in particular energy infrastructure investment to counter BRI’s tidal wave of investment and financing. 

Energy is a key priority in this strategy. Asia’s demand for energy, and natural gas in particular, will continue to grow dramatically in line with national goals for the fuel to play an important role in bolstering energy security and meeting environmental priorities, especially for improving air quality. The Trump administration believes that large-scale exports of U.S. liquefied natural gas (LNG) and oil to Asia could help diversify the region’s energy mix, reduce reliance on imports from the Middle East, strengthen energy security, and help balance growing Chinese economic and diplomatic influence. The administration thus hopes to use energy as a central instrument in defending U.S. economic and diplomatic influence in the region.

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