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The writer is affiliate professor at ESCP Business School Paris, senior researcher at Square Management and a Dauphine University fellow
On February 28, the president of the European Commission visited Delhi to accelerate a comprehensive trade agreement with India, aiming for completion by the end of the year. Shortly afterward, Indian officials returned to Brussels to further these efforts. This diplomatic urgency highlights a major shift in global economic gravity towards the Indo-Pacific. The region, home to more than 60 per cent of global GDP and responsible for over half of world trade, is emerging as the heart of a new global economic order. At its centre lies the Makassar Strait, poised to become a vital economic artery by 2030.
Stretching between Borneo and Sulawesi in Indonesia, the strait offers an alternative to the heavily congested Strait of Malacca. It supports Indonesia’s thriving economy, valued at $1.3tn in 2022, and facilitates critical exports ranging from energy to agricultural and minerals. Indonesia’s infrastructure projects such as its new capital Nusantara promise to amplify the strait’s significance in global trade.
It is time for the west to shed its view of Indo-Pacific countries as mere outsourcers. They have demonstrated their ability to address local challenges and offer universal solutions adapted to limited resources. Their innovations foster new collaborations with Africa, and growing trade flows through Mombasa and Dar es Salaam illustrate the potential for deeper economic integration. A Brussels-Mumbai-Abidjan triangle, incorporating hubs such as Indonesia’s relocated capital and Malaysia’s Cyberjaya, represents a new model for global co-operation.
Beyond its logistical importance, the Indo-Pacific exemplifies dynamic economic growth and innovation. India and the Asean group of nations together represent a combined GDP of $7.3tn, host 25 per cent of the global population and attracted $280bn in foreign direct investment in 2023. Malaysia, India, Vietnam and the Philippines ranked in the top-three innovative economies in 2024 by income. High-tech manufacturing hubs in Malaysia and large-scale green energy initiatives in India underscore the Indo-Pacific’s leadership in future-focused industries. It speaks volume that Hanoi hosted the 2025 International AI-Semiconductor Conference.
The region’s economies are redefining resilience: they leverage crises and adversity as drivers of efficient transformation, innovating with agility. Nusantara, a smart forest city, addresses the challenges of rapid urbanisation, congestion and the sinking of Jakarta, sustainably integrating the internet of things and AI.
India leverages locally sourced and recycled materials to offer affordable, and sustainable solutions, from recycled-truck heat pumps to Mumbai’s dabbawalas, delivering thousands of meals daily despite minimal infrastructure. The success of Chandrayaan-3’s lunar mission exemplifies its ability to achieve transformative outcomes with limited resources.
For Europe, this is a moment to redefine its global role. The EU’s €300bn Global Gateway initiative and the India-Middle East-Europe corridor can strengthen ties with the Indo-Pacific and Africa while enhancing Europe’s strategic potential. Investments in connectivity infrastructure, including terrestrial and submarine cables, could position the bloc as a vital bridge between Asia and Africa.
The Makassar Strait symbolises more than just a shipping route; it is a microcosm of a world where the rules of global trade and innovation are being rewritten. The Indo-Pacific’s adaptability, risk-taking and frugality in innovation provide valuable lessons for a world grappling with finite resources and rising uncertainties. At time of decoupling from the US, Europe has the chance to co-develop a more inclusive and antifragile global economy.
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