2025: Year of The Middle Powers

As geopolitical competition among superpowers intensifies, fragmenting the global economy and financial system, the role of middle powers has attracted much attention from policymakers and analysts. While there is no generally agreed list of middle powers, the term is intuitively understandable and has been used widely as referring to countries ranked below a handful of great powers, but significant enough to be able to act in response to external stimuli with some agency and with some impact, especially regionally. This group of countries will likely be put under pressure by the twin shocks of Trump 2.0 and China’s ever growing manufacturing prowess. The twin shocks have been well documented in the case of the Association of South-East Asian Nations (ASEAN) in a Hinrich Foundation report (January 2025), but the pressure is also on middle powers in general, especially those aspiring to promote their manufacturing sectors to spur growth. In his second term as U.S. President, Donald Trump faces far fewer constraints than in his first term to his unilateral and transactional approach to promote his ‘America First’ agenda. The already strained international situation is likely to become more uncertain, unpredictable, and divisive. Moreover, the U.S. administration will likely be more assertive in dealing with countries seen as taking advantage of the U.S. These developments should incentivize countries that can to take measures to limit their vulnerability and sustain their economic development, while navigating the difficult geopolitical situation. Their efforts will turn a spotlight on them. To monitor middle powers’ reactions, areas to monitor include efforts to reconfigure trade and investment flows to manage the impacts of tariffs while dealing with China’s growing manufacturing exports; measures to benefit from the great power race to secure access to critical minerals; navigating the intensified geopolitical conflict potentially at higher costs; and more ad-hoc coalition building among middle powers and other countries to deal with the challenges.