In recent years, China has asserted a significant presence in the global telecommunications industry, particularly in Southeast Asia’s subsea cable market. Subsea cables are vital to the region’s digital infrastructure, acting as the backbone for global internet connectivity, international data exchanges, and economic trade.
With the proliferation of digital services, the demand for robust, high-capacity, and reliable internet infrastructure has skyrocketed, positioning subsea cables as a critical resource for Southeast Asia’s technological and economic future.
China, with its technological prowess, growing investments, and strategic geopolitical considerations, has become a major player in this dynamic market. From constructing and owning subsea cables to collaborating with regional governments and private corporations, China’s involvement is transforming Southeast Asia’s digital landscape.
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The Strategic Importance of Southeast Asia’s Subsea Cable Market
Southeast Asia has long been a key region for global trade and communications. Its proximity to major global trade routes, combined with the rapid economic growth of countries such as Vietnam, Indonesia, the Philippines, and Thailand, has created a massive demand for improved digital connectivity. According to Statista, the region is home to over 400 million internet users, with internet penetration reaching over 70% in most countries except Laos, Myanmar, and Timor-Leste. This expansion has resulted in an increasing demand for digital infrastructure, particularly subsea cables, to support the growing volume of data traffic.
However, the growing geopolitical tensions in the South China Sea, where many of these cables are laid, pose significant challenges. The competition between major powers, particularly the United States and China, has highlighted the critical importance of these cables not only for civilian communications but also for military and economic exchanges.
China’s rise as a telecommunications superpower has had profound implications for Southeast Asia’s subsea cable market. Over the past decade, China’s state-owned enterprises (SOEs) and private companies have expanded their role as major cable operators, investors, and suppliers in the region, strengthening their technological leadership and economic ties with Southeast Asian nations.
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The Belt and Road Initiative and Cable Investments
China’s Belt and Road Initiative (BRI) has been a key driver in the region’s infrastructure development, particularly in the realm of subsea cable networks. By investing significantly in both new routes and upgrading existing cables, China aims to enhance digital connectivity across Asia. One notable example of this involvement is the completion of the China-Pakistan submarine cable in 2017 and the ongoing development of the China-Indochina Peninsula Economic Corridor.
China’s growing influence in Southeast Asia’s subsea cable market is exemplified by its active participation in the Asia Direct Cable (ADC) system. Set to be completed in 2025, the ADC will directly link Southeast Asia to China, enhancing high-speed internet connectivity between key regions, including Singapore, Hong Kong, and Vietnam. China Telecommunications Corporation, China Telecom Global, and China Unicom are part of the collaboration, reflecting China’s prominence in controlling regional digital infrastructure.
Moreover, China’s China Mobile International and China Unicom Global are key players in the SEA-H2X cable system, a 5,000-km network that connects Hong Kong, Hainan, the Philippines, Thailand, East Malaysia, and Singapore. Future extensions will include Vietnam, Cambodia, and Indonesia.
Another notable project is the Asia Link Cable (ALC), a USD 300 million, 6,000-km system linking Hong Kong and Singapore, with branches to the Philippines, Brunei, and Hainan. Co-led by China Telecom and Singtel, ALC is expected to be completed by 2025.
Additionally, Huawei Marine Networks has become a key player in the design, construction, and maintenance of subsea cable systems across Southeast Asia.
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Economic Benefits of Chinese Involvement
The economic benefits of Chinese investments in subsea cables are undeniable. The construction of new cable routes, combined with the modernization of existing systems, promises to enhance Southeast Asia’s digital economy by lowering costs and increasing the speed and reliability of internet services. According to the World Economic Forum, Southeast Asia’s digital economy is expected to reach almost USD 1 trillion by 2030, largely driven by improvements in broadband connectivity.
Furthermore, Chinese-backed subsea cables offer Southeast Asian countries access to lower-cost solutions, which is particularly valuable for emerging economies in the region. By reducing the overall cost of digital infrastructure, China’s investments have played a pivotal role in making broadband services more affordable for consumers and businesses alike, fostering greater economic integration within ASEAN.
Chinese involvement in Southeast Asia’s subsea cable development has reduced latency, diversified routing, and lowered bandwidth costs for countries like the Philippines, Malaysia, Thailand, and Vietnam. Enhanced connectivity has fueled smart city initiatives in Bangkok, with the Thailand government pledging to establish up to 105 smart cities in large municipal areas by 2027.
China’s influence has supported e-commerce in Vietnam, catalyzing revenues reaching nearly USD 4.6 billion in Q2 2025, representing a 15% quarter-over-quarter (QoQ) growth.
Through Chinese support, nations such as Laos and Cambodia gain access to critical infrastructure via concessional financing, while benefiting from workforce training, localized job creation, and partnerships with Chinese cloud and edge computing services. The result is stronger digital sovereignty, increased foreign direct investment (FDI), and accelerated progress toward ASEAN’s Digital Masterplan 2025.
