US Tariffs: Southeast Asian Countries Seek to Accommodate Trump
The recent announcement by US President Donald Trump to slap tariffs from 10% to as high as 50% on every country has sent shockwaves globally. In response, countries in Southeast Asia, major sources of exports to the US, are angling to accommodate Trump rather than retaliate against his punishing tariffs.
Southeast Asia’s Offers to Negotiate
Vietnam, Cambodia, and Indonesia have said in recent days that they’re open to negotiations over the "reciprocal tariffs" Trump announced this week, while Singapore, a finance and trade hub, said it didn’t plan to strike back. The offers come as nations worldwide weigh how to respond to Trump’s decision to slap tariffs on every country.
Vietnam’s Efforts to Avoid Severe Tariffs
Vietnam has been trying to avoid severe tariffs since Trump re-entered the White House in January. Prime Minister Pham Minh Chinh said he’d golf with Trump at Mar-a-Lago if it would help resolve trade issues. The government has moved to placate the US by cutting tariffs on American cars, ethanol, and liquefied natural gas.
Trump’s Openness to Agreements
Trump has indicated his openness to agreements if countries offer something "phenomenal." "The tariffs give us great power to negotiate," Trump said aboard Air Force One on Thursday, adding that "every country has called us."
Malaysia’s Response
Malaysian Prime Minister Anwar Ibrahim said yesterday that he’d spoken with leaders of Indonesia, the Philippines, Brunei, and Singapore "to exchange views and coordinate a collective response" to the US tariffs. "Malaysia remains committed to fostering consensus among member states and upholding the principles of fairness and equity in all trade negotiations," Anwar said.
Singapore’s Concerns
Singapore Prime Minister Lawrence Wong said yesterday that the likelihood of a full-blown global trade war is growing. "More and more countries will act based on narrow self-interest and use force or pressure to get their way," he said. "This is the harsh reality of our world today."
Cambodia’s Promise
Cambodia, among the poorest countries to be affected and facing the highest US tariff of any Asian economy, at 49%, promised to slash its own duties on US goods and promote their imports. "Cambodia is a serving a useful purpose, smoking out the level of negotiating ambition of the US," said Simon Evenett, founder of the St Gallen Endowment for Prosperity Through Trade.
Indonesia’s Pledge
Indonesia, which faces a 32% US tariff, pledged to ease trade rules and is sending a delegation to Washington next week.
Impact on Apparel Makers
Hints of a deal with Vietnam buoyed the stocks of sneaker and apparel makers in the US, which have become increasingly reliant on the country given its skilled and low-waged labor, infrastructure, and trade agreements with the US. Shares of Nike Inc and Lululemon Athletica Inc soared, while household appliance maker SharkNinja Inc and home furnishings company RH reversed or pared earlier losses.
Conclusion
The response from Southeast Asian countries to Trump’s tariffs is a significant development in the ongoing trade tensions between the US and these countries. While some countries have chosen to retaliate against the tariffs, others are seeking to negotiate and avoid severe tariffs. The outcome of these negotiations will have significant implications for global trade and the economy.
FAQs
Q: What is the current state of trade tensions between the US and Southeast Asian countries?
A: The US has imposed tariffs on several Southeast Asian countries, including Vietnam, Cambodia, and Indonesia. In response, some countries have chosen to retaliate against the tariffs, while others are seeking to negotiate and avoid severe tariffs.
Q: What is the impact of these tariffs on the global economy?
A: The tariffs have sent shockwaves globally, wiping out trillions of dollars in market value and triggering widespread recession alarms. The impact on the global economy is significant, and the outcome of these negotiations will have far-reaching consequences.
Q: What is the significance of Vietnam’s response to the tariffs?
A: Vietnam’s response is significant because it is one of the largest trading partners with the US and has a large trade surplus with the country. Vietnam’s willingness to negotiate and avoid severe tariffs has helped to mitigate the impact of the tariffs on the global economy.
Q: What is the likely outcome of these negotiations?
A: The outcome of these negotiations is uncertain and will depend on the actions taken by the US and Southeast Asian countries. However, it is likely that some sort of agreement will be reached, potentially involving concessions on trade and tariffs.