China's rise and the strategic uncertainty about its future intentions have compelled countries in Southeast Asia, such as Indonesia and Thailand, to adopt hedging strategies to deal with China's rise. Since 2012, with China's foreign policy shifting toward a more proactive and assertive policy posture, Indonesia and Thailand have exhibited divergent hedging responses: Indonesia has shifted toward the balancing end of the hedging spectrum while Thailand has shifted toward the bandwagoning end. This thesis seeks to analyze Indonesia s and Thailand s hedging responses and the key factors that explain their different hedging preferences. This thesis contends that Indonesia s and Thailand s hedging strategies have shifted in response to a change in their ruling elites perception of benefits from an improved relationship with China, vis-a-vis their perception of China as a security threat. In both countries, domestic factors have also exerted an intervening effect on policy outcomes to different extents. Indonesia s hedging strategy reflects the compromise between enhancing Indonesia s future security, addressing nationalistic concerns of defending Indonesia s sovereignty, and gaining economic benefits. On the other hand, Thailand s ruling elites have sought to politically and economically benefit from China s rise in order to bolster their political legitimacy at home.
