I got Southeast Asia Some of the worst From the “Liberation Day” tariff for US President Donald Trump, with Steeling duties It was imposed on countries such as Vietnam, Malaysia and Thailand. Leaders around the region are now trying to negotiate with the White House to see if they can get confirmation.
But regardless of how these negotiations occur, the damage may have already happened. Governments throughout Southeast Asia are already considered growth expectations as global uncertainty threatens the export economic model in the region.
“The increased uncertainty leads companies to stop investing and other business -related decisions such as employment,” says Economy economist, Oxford economist. She adds that the opposite winds of the labor market will also harm private consumption.
Malaysia is the latest country in Southeast Asia, a warning warning this year. On Monday, Prime Minister Anwar Ibrahim He said The country is unlikely to reach its 4.5 % growth expectations to 5.5 % this year, even when some optimism expressed that American definitions can be reduced.
Anwar Add The revised gross domestic product will come “as soon as there is more clarity and see the results of future negotiations.”
Neighboring Singapore Lower Its growth expectations last month, you now expect to grow between 0 % and 2 % for 2025, a decrease from the initial projection between 1 % and 3 %.
“The growth forecast for economies in our region will be negatively affected by the decrease in external demand due to the impact of the broader definitions on global trade and growth,” said the Ministry of Trade and Industry in Singapore in a statement. He added that the diluted business feelings and consumers will also affect local consumption and investments for many economies.
Then, last week, the Ministry of Finance in Thailand Cut It is expected to grow to 2.1 %, a decrease from 3 %. I blame the customs tariffs and how it could slow down the global economy.
Thailand’s drop can be cut off further. The new projection is 2.1 % on whether Bangkok is able to negotiate 36 % reduction in Trump’s tariff in a country of Southeast Asia.
The United States is the largest export market in Thailand, and the second largest export market in Malaysia and Singapore.
In contrast, Vietnam maintains the 8 % up to 2025 bullish growth, despite a 46 % tariff confrontation of the Trump administration. On Monday, Prime Minister Fam Minh Cennis repeated that the country would maintain the goal of growth. American exports represent about 30 % of the country’s gross domestic product.
Trump, 90 -day, stopped the mutual tariff on July 8. Southeast Asian governments are currently negotiating with Washington, as they have been reduced to their import taxes on American goods or to buy more American products. Despite the positive correspondence from Trump and its officials that the deals are coming, there was no general announcement of an agreement, or even the framework of an agreement.
“The fact that this offer to make irregular policies has come at the beginning of Trump’s term for four years, it will keep companies and families careful for a longer period,” says Yi.
The economist suggests that the best possible result for Southeast Asia is a 10 % tariff for its exports related to the United States. This will allow the region to benefit from the continued diversification of the supply chain away from China, which still faces a 145 % tariff rate on its exports.
However, Yue warns that Southeast Asian economies still can end up with the complete tampering of Trump’s definitions if a deal is not reached. This may lead to the transformation of production to countries with a lower American tariff, which may lead to the flow of capital with the transfer of manufacturing to another place.
This story was originally shown on Fortune.com
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