ASEAN “deeply concerned” over US tariffs; opts to negotiate

SINGAPORE (ICIS)–The 10-nation ASEAN group re-affirmed on Thursday the region’s commitment to work together with the US to address trade imbalances, noting that no retaliatory tariffs will be imposed on the world’s biggest economy.

“ASEAN, being the fifth largest economy in the world, is deeply concerned over the recent introduction of unilateral tariffs by the US,” the region’s economic ministers said in a joint statement after holding an emergency meeting chaired by Malaysia’s Minister of Investment, Trade and Industry Zafrul Abdul Aziz.

They noted that the resulting uncertainty will bring “significant challenges” to business owners as well as global trade dynamics, citing that the US was ASEAN’s largest source of foreign direct investment (FDI) and the region’s second-largest trading partner.

ASEAN comprises southeast Asian countries Thailand, Vietnam, Indonesia, Malaysia, Singapore, Philippines, Laos, Cambodia, Brunei and Myanmar. Representatives from all ASEAN countries except Brunei attended the meeting.

Vietnam and Thailand are facing US’ reciprocal tariffs of 46% and 35%, respectively – which are among the highest levies imposed on a trading partner.

“Open communication and collaboration will be crucial to ensuring a balanced and sustainable relationship,” the ministers said in the statement.

They also affirmed readiness to work with the US to find mutually acceptable solutions of common interest, including facilitating two-way trade and investment, deepening strategic trade partnerships, and enhancing supply chain connectivity and resilience through digital technology and innovation, that can promote stronger regional cooperation”.

“As a group, we will continue to discuss ways on how to further strengthen and boost intra-ASEAN trade and investment within the region,” they added.

In the latest escalation of a brewing trade war, US President Donald Trump raised the US’ tariffs on Chinese products to 125% after China imposed 84% tariffs on US goods.

In a U-turn from previous announcements, Trump temporarily suspended reciprocal tariffs on all countries, except China, for 90 days on 9 April, but kept its 10% baseline tariffs.

ASEAN ministers have been in talks with the US in the days following the 2 April announcement of reciprocal tariffs.

Vietnam deputy prime minister Ho Duc Phoc began trade negotiations with US trade representative Jamieson Greer on Thursday.

Thai Finance Minister Pichai Chunhavajira said on Thursday that he welcomed the suspension of tariffs and hoped that a deal can be worked out between the two countries.

Both southeast Asian countries have made offers to lower tariffs on US goods as well as commit to lowering their trade surpluses with the US.

Chunhavajira is ready to lead a team to the US to talk to White House representatives “as soon as next week”, according to Thai Foreign Ministry spokesman Nikorndej Balankura.

Singapore’s Prime Minister Lawrence Wong said on 8 April that the city state will not impose retaliatory tariffs on the US, while a task force chaired by Deputy Prime Minister Gan Kim Yong will be set up to help businesses affected by the tariffs.

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