ASEAN proactive in fluctuations

Could the Association of Southeast Asian Nations (ASEAN) become the next “victim” of US President Donald Trump’s additional tariff policy?

President Donald Trump's tariffs will be one of the important variables for the ASEAN economy, which is heavily dependent on exports to the US market. (Source: Reuters)

Southeast Asia welcomes President Donald Trump’s return to the White House with a mix of expectations and concerns. ASEAN plays a central role in Washington’s Indo-Pacific strategy, but China – America’s top rival – has significantly increased its presence in Southeast Asia, investing in infrastructure projects and using its economic might to build regional partnerships. So ASEAN could very well be in the crosshairs!

Pragmatic and realistic

The Trump administration’s tariffs on trading partners have been called “the biggest shock to global trade policy in 50 years.” Beijing is one of the first targets repeatedly mentioned, but Southeast Asia seems to have been left out.

Observers say Southeast Asian members are enjoying a temporary “peaceful” moment before something very likely happens, as Mr. Trump’s tariffs will be one of the important variables for a regional economy that is heavily dependent on exports to the US market.

In a study titled ASEAN faces China Shock and Trump 2.0, Henry Storey, a senior analyst at Melbourne-based political risk consultancy Dragoman, said Trump’s mercantilist obsession with trade deficits is bound to cause anxiety in ASEAN. This is not surprising, given that all of ASEAN’s major economies (except Singapore) have large trade surpluses with the US – an indicator that Trumponomics sees as an imbalance that needs to be corrected.

Muhammad Waffaa Kharisma, an expert at the Center for Strategic and International Studies (CSIS) in Jakarta, commented that some ASEAN member states are important to the US, but ASEAN as an institution remains an open question, especially in the context of the White House's waning enthusiasm for multilateral organizations.

However, US Secretary of State Marco Rubio has emphasized the US’s “pragmatic” and “realistic” approach to ASEAN to strengthen relations with the bloc. Affirming the need for flexibility in cooperation with countries in the region, at his congressional hearing before his appointment (January 2025), Mr. Rubio clarified President Trump’s ASEAN strategy that the US should avoid pressuring ASEAN to choose sides in the competition between major powers, which would destabilize the region and erode trust.

Mr. Rubio emphasized that prioritizing economic cooperation is the foundation of US-ASEAN relations, affirming ASEAN's central role in addressing regional challenges, such as security threats, climate change, human rights issues and public health crises.

Noting that the US is currently ASEAN’s second-largest trading partner and largest investor, US Secretary of State Rubio said that during President Trump’s first term, there has been a shift in supply chains from China to other countries and some ASEAN countries have benefited from that. “There are some countries in the region that are concerned about new US economic or other policies, but that can also bring real economic development opportunities for some countries in ASEAN,” Mr. Rubio said.

Self-reliance in a changing world

According to observers, although Southeast Asia has not been affected by the first series of trade actions at present, with the White House owner continuing to push tariff policies on trade partners, the possibility of ASEAN being caught in this "vortex" may be very close. In addition, due to the current interconnectedness between economies, the Trump administration's tariff policies not only worsen the Washington-Beijing trade relationship but can also have a strong impact on ASEAN countries, which are partners of China, especially those with trade surpluses with the US.

Despite the spillover effects of the US-China rivalry, the world’s largest market remains open, allowing ASEAN to become one of the largest export partners to the US, according to expert Henry Storey. Storey believes that, in the face of the tariff threat, individual ASEAN members can make the most of the economic opportunity, as each country has its own policy options, including defensive trade measures. This will require deft and proactive diplomacy, as well as careful management of competing domestic interests.

But if “going together”, in the context of geopolitical tensions that can change trade flows, senior researcher Veeramalla Anjaiah of the Center for Southeast Asian Studies (CSEAS) said, ASEAN needs to have a skillful and effective response strategy.

Faced with increasing external pressure, ASEAN’s success depends on its ability to maintain cohesion and unity among its members in pursuing common interests. According to Mr. Anjaiah, ASEAN should continue to commit to implementing free trade agreements with major powers, while diversifying its trading partners, to minimize risks from geopolitical tensions and enhance economic stability.

With Washington, along with efforts to balance trade relations, such as reducing the trade surplus, increasing imports of goods and services from the US. Intra-bloc cooperation is also an important factor that is assessed to be able to make ASEAN more self-reliant and reduce dependence on external partners. Expert Anjaiah suggested that intra-bloc investment in infrastructure, logistics and new technologies, such as artificial intelligence, automation, etc., will help ASEAN increase its competitiveness and attract international investment. At the same time, by rising strongly, ASEAN will elevate its position in the role of contributing to promoting global peace, stability and prosperity.

ASEAN is considered a place where superpowers compete, because of its great potential, favorable geostrategic position and collective economic weight. With its own advantages, and at the same time from suitable solutions "Building a united, inclusive and self-reliant ASEAN in a volatile world" - as the theme of the second ASEAN Future Forum in Hanoi (from February 25-26), it is expected to help the region maintain stability and continue its sustainable development steps.

Source: https://baoquocte.vn/asean-chu-dong-trong-bien-dong-305853.html