Issue #181: The Impact of Trump’s Tariffs in ASEAN & Asia Pacific: One Week On (Part 1)
How China and ASEAN governments respond will shape the future of global trade.
Welcome to Issue 181, a special midweek edition of Asia Travel Re:Set.
Picture the scene: 1
A hot, humid late-summer’s morning in Shanghai in 2008. I’m in a descending elevator from an upper floor of a skyscraper in Pudong: China’s Wall Street.
A group of Chinese bankers enters on a mid-level floor. They speak in hushed, courteous but evidently upbeat tones.
Lehmann Brothers had collapsed overnight.
China’s major banks had been recently recapitalised. ICBC had completed the world’s largest IPO. Untrammelled financial confidence was palpable. A sense of inflection.
Whether or not Chinese economists saw the 2008 Financial Crisis coming, they were certainly well prepared. The industrial-grade stimulus subsequently pumped into the economy by the PBoC likely saved numerous companies and governments worldwide.
Picture the scene: 2
17 years later, a spring afternoon in the White House Rose Garden in 2025.
President Trump unleashes a stinging round of tariffs on the US’s global trade partners to glean short-term gains and boost his status with his supporters at home.
He is gleefully unaware of the tide of anger that will foment in China, across Asia Pacific and throughout the Global South over the coming days.
History may read this as the acceleration of a process in place since 2008. This process is unfavourable to US interests.
The hubris of the leader of the world’s largest economy creating an international backlash from which the diplomatic credibility of the US will struggle to recover.
Picture the scene: 3
The short-term shockwaves are visceral and very real. Fury against the US President in Asian political circles is intense, but diplomatically disguised. For now.
Managing this economic emergency (for that is what it is) step-by-step is the rational response.
“It’s not easy to be dispassionate or reflective in this type of situation, but those are exactly the attributes required [by trade negotiators].”
The long-term outcomes for ASEAN and Asia Pacific nations depend on how their leaders respond now. Negotiation is the correct tactic for emerging nations to proceed given President Xi Jinping is prepared to directly confront President Trump.
China’s holding of the fort for Asia Pacific will not be forgotten. Trump will never be forgiven.
And President Xi is heading shortly to Vietnam.
This, along with the accelerated defrosting of trade relations between China, Japan and South Korea, is the most significant geo-economic move in Asia Pacific in 2025.
Expect many, many more.
Thanks for checking in…
The Impact of Trump's Tariffs in ASEAN & Asia Pacific: One Week On (Part 1)
“The panic at the moment is to shore-up the short-term economic damage.”
Over the past 7 days, we've seen stock markets crash, currencies (Indonesia’s rupiah, especially) come under pressure and trade officials book fights to Washington DC.
But, once the initial ‘crisis dust’ has settled, what will all this mean for ASEAN (and Asia Pacific)?
In the first of The South East Asia Travel Show’s special 2-part podcast, I navigate beyond the headlines to address the background to the high tariff rates slapped on most ASEAN economies, and ask and answer these questions:
↔️ Why tariffs, why differentiated rates, and why now?
↔️ Are Indochine nations being hit with the highest tariffs because they reside in China's trade orbit?
↔️ What are the reasons that ASEAN governments are negotiating and not retaliating?
↔️ Why is Vietnam the high-watermark case study, with perhaps the most at stake?
↔️ What are the options open to ASEAN trade negotiators to reduce the short-term damage and re-plan for the future?
↔️ What does all this mean right here, right now?
Part 2, coming on Friday, will delve into the intra-ASEAN implications, the view from China and the outlook for travel and tourism across the region.
Click on the live link below to listen to The Impact of Trump’s Tariffs in ASEAN & Asia Pacific: One Week On (Part 1).
Or search for The South East Asia Travel Show on any podcast app.
And, that’s a wrap for this mid-week special issue.
Asia Travel Re:Set will be back on Sunday. Meantime, find me on LinkedIn.
Happy travels,
Gary