The Trump administration’s new tariffs are hitting Southeast Asian countries hard. These tariffs could disrupt the region’s manufacturing sector and create an opening for China to exert its influence.
On Wednesday, President Donald Trump announced the tariffs from the White House, calling it “Liberation Day.” The tariffs require every country to pay a 10% tax. Countries with a large trade deficit with the US face even higher tariffs.
The White House said the president declared a national economic emergency. His order imposes retaliatory tariffs to strengthen the US’s international economic position and protect American workers. These tariffs are central to Trump’s plan to reverse the economic damage he says happened under Biden and bring a new golden age to America.
Countries in ASEAN Hit Hardest
The countries in Southeast Asia hit hardest by the tariffs are:
- Cambodia – 49%
- Laos – 48%
- Vietnam – 46%
- Myanmar – 44%
- Thailand – 36%
- Indonesia – 32%
- Brunei – 24%
- Malaysia – 24%
- Philippines – 17%
- Timor-Leste – 10%
- Singapore – 10%
The report says these tariffs are a response to taxes imposed by these countries on the US. However, many analysts note that the numbers seem to be based on each country’s trade deficit with the US, rather than actual tax calculations.
Mike Bird, an economist at The Economist, said on X that this method of calculating tariffs is “utterly dishonest” and “almost incompetent.”
Impact on Vietnam and Cambodia
One of the countries hit hardest is Vietnam. The US is Vietnam’s largest export market, with 29% of Vietnam’s total exports going to the US, and nearly 30% of its GDP.
Vietnam had a trade surplus of $123.5 billion with the US in 2024, the third-highest in the world, after China and Mexico. Despite the Vietnamese government’s efforts to strengthen economic ties with the US, the 46% tariff could erode trust between the two countries.
Kang Wu, a geopolitical analyst, said on X that this is a “strategic self-inflicted wound,” especially with Chinese President Xi Jinping about to visit Vietnam.
Cambodia, which faces a 49% tariff, may be severely impacted in the garment and textile sector, a key industry for the country. The high import tariffs could lead to mass layoffs and social unrest.
Regional Impact and China’s Growing Influence
As the US imposes new tariffs, China, which faces an additional 34% tariff on top of the existing 20%, may use this opportunity to expand its influence in Southeast Asia.
While countries in the region may try to negotiate lower tariffs, the measure reflects the US’s abandonment of free trade principles, making China a more stable and predictable economic partner.
Ivan Figen, a former analyst at the Carnegie Endowment for International Peace, said the US is losing its importance in Southeast Asia. He added that regional countries can handle pressure from major powers but need a partner with principles and strategy, which the US currently lacks. This comes as President Xi is set to visit Malaysia, Vietnam, and Cambodia this month, with economic issues likely to be a key focus of the talks.
Source: Thediplomat
