Fri, 11 Jul 2025

Fri, 11 Jul 2025 Asia is reeling from Trump's tariff salvo – is anyone winning?

The US president has reset the tariffs clock again, leaving Asia's export-driven economies in limbo.
Japanese Prime Minister Shigeru Ishiba has expressed "deep regret" over US President Donald Trump's latest tariff threat, which targets Japanese goods with a 25% levy. Despite Tokyo's efforts to avoid this outcome, negotiations have yielded little progress. Japan's trade minister has visited Washington DC seven times since April, but the talks have been unsuccessful. Trump has also announced a 35% tariff on Canadian goods and plans to increase blanket tariffs from 10% to up to 20% for most trading partners. He dismissed concerns that further levies could push up inflation. Countries around the world have until August 1 to strike a deal with the US, but they are likely wondering about their chances given Japan's experience. Economists say that further extensions of the tariff deadline are likely due to the complexity of trade agreements. They also note that countries will need time to implement Trump's demands, which are not entirely clear. The impact of tariffs is far-reaching, affecting not just exporters but also US importers and consumers. The economic ambitions of large parts of Asia, fueled by manufacturing, are also at risk. Some countries, such as Vietnam and Cambodia, may lose more than others due to their limited leverage against Washington. Others, like Japan and South Korea, may be able to hold out longer due to their stronger economies and geo-political influence. Japan's refusal to buy US rice or give in to US demands for increased military spending has annoyed Trump, but Tokyo appears well-prepared for the long game. Economists say that a deal is unlikely by August, given Japan's upper-house election this month. The trade war between Washington and Beijing has put Asia at the center of the conflict, with analysts saying that Trump may be ceding ground. The US's bargaining position has been diminished, and deals made could come at the cost of reshaping trade and ties built over decades.
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