Bangkok — The intensified trade war initiated by U.S. President Donald Trump in his second term presents significant challenges for all Asian economies, regardless of size, during a period where the most populous region in the world is expected to lead global economic growth. The growth of export manufacturing and the benefits of free trade have transformed China and other Asian countries into economic powerhouses over the past few decades. However, Trump’s imposition of tariffs, intended to encourage companies to maintain or establish factories within the United States, is disrupting trade agreements that have been negotiated at great political cost to the U.S.’s trading partners.
The White House has outlined that the criteria for increasing tariffs will include not just health-related procedures but also various taxes, exchange rates, government subsidies, and other non-tariff trade barriers. Apart from tariffs that will be announced on the “Liberation Day” as referred to by Trump, a 25% tariff on the import of autos and auto parts is set to take effect on Thursday.
Trump has also instituted levies against China, Canada, and Mexico; expanded tariffs on steel and aluminum imports; and imposed tariffs on countries that import oil from Venezuela. Further import taxes are planned on pharmaceutical drugs, lumber, copper, and computer chips. The resulting higher costs have prompted many manufacturers to diversify their operations to other economies in South and Southeast Asia, Africa, and Latin America. Nevertheless, the prevailing uncertainty over Trump’s “reciprocal” tariff policy is currently fostering a wait-and-see attitude among businesses.
For a detailed analysis of how higher U.S. tariffs might affect major Asian economies like China, Japan, Taiwan, South Korea, Vietnam, and India, please continue to the following sections which provide insights into their potential responses and the impact on their trade with the United States.
Source: https://time.com/7273679/counting-potential-toll-of-trump-tariffs-asian-economies/
