The recent US-China trade truce has offered a brief pause in the ongoing tariff battle, but for ASEAN countries, it has raised new challenges and opportunities. As the world’s two largest economies ease tensions, Southeast Asian nations are now racing to secure their own deals, seeking lower Trump tariffs to protect their exports and economies.
🔶 US-China Trade War: A Temporary Pause
Earlier this month, the United States and China reached a temporary agreement to reduce certain tariffs, cutting rates from as high as 145% to 30% on selected goods. This US-China tariff truce is aimed at calming global markets and giving both sides time for further negotiations.
However, while this move benefits China, it sidelines ASEAN economies like Vietnam, Malaysia, Thailand, and Indonesia, who are deeply reliant on exports to the US market.
🔶 ASEAN’s Growing Risk of Being Sidelined
For ASEAN nations, the biggest concern is being sidelined in global trade talks. As the US focuses on its direct relationship with China, Southeast Asian exporters fear losing their competitive edge. The risk of transshipment accusations—where Chinese goods are re-routed through ASEAN to bypass tariffs—further complicates matters.
Recently, Vietnam has come under scrutiny for allegedly acting as a “backdoor” for Chinese goods to enter the US, sparking fears of tighter trade inspections and possible new tariffs on ASEAN products.
🔶 ASEAN’s Strategic Response: Fighting for Fair Tariffs
To avoid being left out, ASEAN members are taking proactive steps:
- Bilateral Talks with the US: Countries like Malaysia are in active negotiations with US trade officials, aiming for sector-specific tariff relief in industries like semiconductors and electronics.
- Diversifying Trade Partners: ASEAN is pushing for stronger ties with the European Union, Gulf Cooperation Council (GCC), and boosting trade through the Regional Comprehensive Economic Partnership (RCEP).
- Enhancing Intra-ASEAN Trade: Regional integration efforts are being strengthened to create a more self-reliant Southeast Asian market.
🔶 Economic Impact on ASEAN
The fallout from the US tariffs is already being felt:
- Manufacturing Slowdown: ASEAN manufacturers face tough competition as Chinese firms redirect surplus goods into Southeast Asian markets.
- Rising Costs & Inflation: Higher tariffs mean more expensive imports, which drive up prices for consumers across ASEAN nations.
🔶 What’s Next for ASEAN in the Global Trade War?
As the US and China navigate their complex relationship, ASEAN countries must act swiftly to secure their trade interests. Lowering Trump-era tariffs is now a top priority for the region to ensure economic stability and growth.
For ASEAN, the choice is clear: adapt, negotiate, and diversify—or risk being sidelined in the new world trade order.
