Asian Economies scramble to appease trump as the US president ratchets up tarif threats

As the speaker of donald trump’s reciprocal tarifs looms, several asian economies that Enjoy Substantira Trade Surpluses with Washington Are Scrambleing to Negot Revent Being Slapped with Higher Duties.

Trump said Friday that he would announs reciprocal tariffs – duties that match these levied on us Goods by Respective Countries – as soon as soon, to take IMMIDITELY. Trump did not identify which countries will be hit but indicated it would be a broad effort to help eliminate us trade deficits.

While The Details Remain Unclear, “It is likely that Us Import Tarifs will show for Most Emerging Asian Economies,” A Team of Analysts at Barclays Said Monday, with the exceptions of singap Ith which the US Enjoys Trade Surpluses.

Based on World Trade Organization Estimates, Most Economies in Asia Applied Higher Average Tariffs On Imports Compared with the Us as of 2023. India Led with a 17% Simple Average Rate on Countries with the Most-Favored-Nation Status, Compared with the us that Leviies 3.3%The US Enjoys MFN Status With Most Most Major Economies, Except Russia.

China Topped Trade Surplus with the us last year at $ 295.4 billion, Followed by Vietnam’s $ 123.5 Billion, Taiwan’s $ 74 Billion, Japan’s $ 68.5 billion and South Korea’s $ 66 Billion, According to us census bureau,

“Just because these economies have dodged tarifs for now, (it) doesn’t meaning they can breathe easy,” Stefan Angrick, Senior Economist at Moody’s Analytics Told CNBC, Stressing Could Shift and Tariffs Could Still Be Imposed Later. “

These counts, except for vietnam, was spored in trump’s opening tarif salvo thanks to their deep security ties with washington and large engineers in the US, ANGRICK SAID, BUT ” Table. “

Vietnam’s Trade Surplus with the US Soared Nearly 18% Annually to a record high last yearThe country’s Simple Average tariff Rate On MFN Partners Stood at 9.4%, According to Wto Data.

Beverages and Tobacco Imported Into The Country Face Up to 45.5% Tarifs on Average, While Categories Such as Sugars and Confectionery, Fruits and Vegetables, Clothing and TRONSPORTHING ARECT Ed to tarifs between 14% and 34%.

Trump, Who in 2019 Called Vietnam “almost The Single Worst Abuser, Of trade practices, have not made any public remarks about the nation after his re-election in November.

Hanoi has made efforts in recent months to find compromises with washington on trade. In November, The Country Vowed to Buy More Aircraft, Liquified Natural Gas and Other Products from the US

Vietnamese Prime Minister Pham Minh Chinh Last Week Asked Cabinet Members to prepare for the impact of a Possible Global Trade War This year.

Vietnam was a Major Beneficiary of the Trade Barriers Trump imposed on Beijing in his first term, which spurred manufacturers to shift production out of China. Consequently, the southeast asian nation became one of the largest recipient of Foreign Direct Investment from China.

The us may double its tariffs on vietnam to 8% if it enforces “full tariff reciprocity,” Michael Wan, Senior Currency Analyst at Mufg Bank said in a note on Monday. That said, he expects a less extreme us stance on the country, with “some sector-specific tariffs” as a more likely possibility.

New delhi in its Union Budget earlier this month Reduced tariffs on a range of products including motorcycles, electronic goods, critical menrarals and lithium Ion batteries. Finance secretary tuhin kanta pandey Said in an interviewThat “we are signaling that India is not a tariff king.”

Indian Prime Minister Narendra Modi is Reportedly prepared to discus further Tariff Cuts Across a Dozen Sectors and Buying more energy and defense equipment from the us at his meeting with trump later this week.

India’s Surplus with the US, Its Second-largest trading partner, Reached $ 45.7 billion last year. Notably, the country’s important Agricultural Goods Were Subjected to Hefty 39% Duties.

DURING Trump’s First Term, He Had Warm Relations with Modi, but DURING HIS CAMPAIGN for Re-Election, Trump Had Called India a “very big abuser” With tarifs.

In a phone call with modi last month, trump emphasized the importance of India buying more us-money security equipment to reach a “Fair Bilateral Trading Relationship“According to the white house statement.

Some Market Watches Floated The Idea That The Two Sides May Resume Discussion on the long-awaited Us-India Free Trade AccordThe joe biden administration had Reportedly rebuffed India’s interest In exploring a free trade agreement, Indian local media reported, Citing the Country’s Commerce and Industry Minister.

“Such a Deal Now Delhi Substantial Tariff Reductions by New Delhi Because it has much higher tarif rates than washington; trump believes in some degree of records,” , distinguished fellow At couricil on foreign relations,

India could also offer to shift its oil imports from Russia toward the US significant to align with trump’s plans of boosting oil and gas expenses, said arpit chaturvedi, south assia Adviser AT TENEO.

Japan appears to have secured a positive relationship with trump and could be shielded from higher tarifs “for now,” Analysts said, as prime ministeru Wrapped up a whirlwind visit to washington Over the weekend.

Tokyo maintains relatively low tarifs of Around 3.7% On Countries with Mfn Status, According to Wto Data. That sugges “Little Scope for Substantial Increases in Tariffs on Japanese Goods,” Kyohei Morita, Chief Japan Economist at Nomura Said in A Note Monday.

DURING The Summit Last Week, Japan Agreed to important more natural gas From the US and Expressed Interest in a Project to Deliver LNG Through a Pipeline from Northern Alaska.

The two leaders also agreed on a compromise that instead of acquiring us steel, japan’s nippon steel will “invest heavily” in the us firm. Japan will provide technology for us steel to manufacturer better quality products in the US, Ishiba said.

Japan, which has been the largest foreign investment in the US For five straight years, Also pledged to expand that investment to $ 1 trillion, from $ 783.3 billion in 2023,

“While Japan May Not Avoid All The Effects of Future Us Tariff Policies, Tokyo May Avoid The Targeted Treatment Seen With Countrys Like Canada, Mexico, and China,” James Craft Ay Note.

“It may even hope for more lenient trade treatment than Other Major Economies, as it appears to enjoy the status of one of trump’s most favorite nations,” Brady said.

Beijing’s Tit-For-Tat MeasureS – Including 15% Levy on Us Coal, Liquified Natural Gas, 10% Duties on Crude Oil, Farming Equipment, Cars and Pickup Trucks – Are Belied to Be Modest and Restrained.

The tariff package is estimated to cover $ 13.9 billion of China’s imports from the us in 2024, according to data compiled by nomura, accounting for 8.5% of china ‘ Al Imports.

That is significant lower than the $ 50 billion Worth of us Goods Targeted during Trump’s First Term, Said Tommy Xie, Head of Asia Macro Research at OCBC BANK BANK BANK IN A Note on Monday.

The “Calibrated Approach” Signaled that “China is opting for a more diversified response,” with non-tariff countermeasures think as expert controls and regulatory probes intoly Room for Further Negotiations, “Xie Added.