Pivotal power of small states to save the international liberal economic order: the case from East Asia

Abstract

Small- and medium-sized states acquire significant influence when regional and global orders are in flux, as in times of power transition. We have observed such dynamics especially since the 2008 Global Financial Crisis, when the competition between two superpowers of the United States (US) and China has intensified in such a way that it affects the soundness of the liberal international economic order (LIEO). These smaller states have become influential in the institutionalization of regional political and economic orders when conditions are right. We argue that the following three aspects of a small state’s attributes influence heavily in shaping their proactive approach to LIEO. The first is its economic structure that shapes its motivation. The second is its polity type that defines internal constraints. The third and final component is its international status that imposes external constraints. This study examines trade policies taken by Vietnam, Indonesia, and South Korea from the 2010s and onward and compares their respective approaches and their impacts on economic order-building in East Asia and beyond.