Southeast -Asian governments are looking for negotiations on Trump rates

A day before US President Donald Trump’s hard “mutual rates”, the most important economies of Southeast Asia of the announcement of the Globe-Hing will remain, while their governments hastily combine a reaction.

Stock markets in Singapore, Malaysia, Thailand and the Philippines tumbled when the trade was opened yesterday, after China announced hard retribution rates to the United States and escalated a trade conflict that could evolve into full economic warfare.

In recent days, the leaders of the most important economies of the region have continued to clarify their approaches of the Trump government rate announcement, which has been particularly hard in Southeast -Asia. Under the Southeast Asian economies, Cambodia was hit by the highest percentage – 49 percent, one of the highest in the world – followed by Laos (47 percent), Vietnam (46 percent), Thailand (36 percent), Indonesia (32 percent) and Malaysia (24 percent).

As I noticed last week, most are remarkably reluctant in their response, a function of the importance that the US plays as a market for the export of the region.

As regional delegations come together on Washington for conversations aimed at tariff lighting, most governments in the region have outlined a dual strategy, which combine short -term concessions to Trump, including the reduction of their own rates and promises to increase their relevance to the market with a long -term. Until now, nobody says they will take revenge on American rates by increasing their own rates.

In Indonesia, the shock of Trump’s rate announcement of 2 April yesterday wiped 9.6 percent Outside the Indonesia stock exchange composite index and sent the rupiah to a low point of 16,898 Rupiah per US dollarthe weakest level of the currency registered.

President Pabowo Subianto has since announced that his government will send a high -level delegation to Washington to negotiate tariff lighting. “We will say, we want a good relationship,” said Pabowo yesterday during a rice harvest event in West Java, Reuters reported. “We want an honest relationship. We want an equal relationship.”

Thailand’s strategy to minimize the rate announced by Trump will include promises to import more goods and increase American investments in the country, Bloomberg reportedAlthough the country has not yet made an offer to lower rates. Finance Minister Pichai Chunhavajira will leave for the US this week for discussions with “the government sector, the private sector and stakeholders”, Prime Minister Paetongtarn Shinatra Announced on Sunday.

“We will tell the US government that Thailand is not only an exporter, but also an ally and economic partner on which the US can trust in the long term,” she said.

Supavud Saicheua, a member of the Thai government working group for rates, told the State-run MCOT television channel that Thailand would offer to import more American energy, planes and agricultural products.

“We will pursue the middle path,” he said Bloomberg. “We don’t hurry to the US, and we will not stand still and take revenge on China. We will try to find ways about how we can live with the new Trump administration.” The Thailand’s Department of Foreign Trade has that too promised to increase his supervision From export to the US that are falsely claimed as of Thai origin.

Vietnam was the first nation in the region that responded to the rates, a benchmark for the threat that the astronomical rate of 46 percent is for the growth model of Vietnam, guided by the export. In a call with Trump on April 4, to LAM, the head of the Communist Party of Vietnam asked that Trump imposed the rates a delay of 45 days and offered to completely remove the rates of the country as a starting point of negotiations. Trump later described the call As “very productive.”

On Sunday, Deputy Prime Minister Bui Thanh Son Meeted our ambassador Marc Knapper In Hanoi, and asked again to postpone Trump the enforcement of the rates while the two parties are negotiating. Deputy Prime Minister Ho Duc Phoc, who is currently in the US, told companies on Friday that Vietnam was looking for a delay of one to three months. There have also been report That phoc will take out a deal with the purchase of Boeing aircraft by a Vietnamese airline.

In Malaysia, Prime Minister Anwar Ibrahim, who is also the Minister of Finance of the Land, described the ‘unilateral decision’ of the Trump government as a rejection of the ‘principles of the World Trade Organization’ of free, non-discriminatory, predictable and open trade ‘. In a video address on his social media accounts on Sunday, Anwar said that his government would not introduce retribution rates and the country would “endure this challenge through a position of strength and readyness”, Channel News Asia reported.

Anwar, the current chairman of the Association of Southeast Asian Nations (Asean), also has promised To bring the block of 10 members together “constructively engage” with the US about the rates and “leading efforts to present a united regional front, to maintain open and resilient supply chains and to ensure that the collective voice of ASEAN is heard clearly and firmly on the international stage.” On April 5, Malaysia, Indonesia, Brunei, the Philippines and Singapore held a teleconference to discuss the rates, and Ministers of Asean were planned Met Thursday In an attempt to coordinate a collective response.

As I noted on Friday, Cambodia’s response to the tariff announcement has been relatively lackadaisical, and surprisingly so, given the impact that Trump’s 49 percent tariff could have on its economically pivotal apparel and footwear exports to the US In a letter to Trump on Friday, Cambodian Prime Minister Their Manet Offered “To Negotiate with Your Honorable’s Administration at the Earliest Covenient Time” and Propose an “Immediate Reduction of 19 Produce Categories of our maximum rate -related rate of 35% [a] 5% applied rate percentage. “

As my colleague David Hutt noted in his Cambodia unfiltered newsletterThis is unlikely that it is sufficient for the US, who can expect concessions about other issues, including the Ream Naval Base, which has been finished by China, a long-standing care in Washington, or late action to eradicate cyber cam operations that continue to work from Cambodian soil.

Complicating the comparison for Southeast Asian governments is the uncertainty about the ultimate goal of the rates. In an attempt to offer post -hoc rationalizations for Trump’s attack on the global trading system, American officials have offered different mutual conflicting objectives: to increase income, to promote, repair (or eliminate) trade shortages or power partners to make significant strategic concessions about the economic and national security questions, especially in particular.

Although many Southeast Asian countries have operated on the last two assumptions, offering to increase purchases of American goods and/or to reduce their remaining trade barriers, Trump and its inner circle have comments has doubts about whether the rates are Even for negotiation. For example, Trump’s trade advisor Peter Navarro said yesterday The fact that Vietnam’s offer to reduce his rates on American goods “means nothing for us”, given the “not -falling” that had contributed to his industrial surplus of $ 123.5 billion with the US who spoke to Fox News, Navarro Vietnam accused as a “transition” point for Chinese goods and described It as ‘essentially a colony of communist China’, a characterization that would undoubtedly raise eyebrows in Hanoi. There is also the possibility, broadcast by Abraham Newman In the Financial Times, the tariff movement is an act of “power, hierarchy and dominance” without a clear remedy.

Given the chaotic nature of the rate announcement, and the conflicting rationalisations offered by the Trump government so far, it is very likely that each of these cases will be resolved in a similar ad hoc way through bilateral negotiations, in the coming months. A full accounting of the damage that this causes to Washington’s reputation as a reliable and predictable economic partner will probably take much longer.