The Asian economies attempt to appease Trump when the US President will increase tariff threats

Portsmouth, Great Britain – October 28: The container ship Vung Tau Express sails on October 28, 2024 in Portsmouth, England, with shipping tanks near the English coast.

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Since the ghost of Donald Trump's mutual tariffs threatens, several Asian economies try to enjoy essential trade surpluses with Washington to prevent cheap solutions with the US President to prevent them from being beaten with higher duties.

Trump said on Friday that he would announce mutual tariffs -tasks that correspond to the respective countries of the respective countries with the goods raised for US goods -in order to come into force immediately. Trump did not identify which countries should be hit, but indicated that it would be a wide effort to eliminate US trade deficits.

Although the details remain unclear, “it is likely that the US import tariffs will increase for most emerging Asian economies,” said a team of analysts in Barclays on Monday with exceptions to Singapore and Hong Kong, with which the USA enjoys trade surpluses.

Based on estimates by the world trade organization, most economies in Asia used higher average tariffs compared to the United States. India led with a simple average rate of 17% in countries with the status of the most favored nations compared to the USA that benefited the most. Duties 3.3%. The United States enjoys MFN status with most major economies with the exception of Russia.

China last year has the trade surplus with the United States with $ 295.4 billion, followed by $ 123.5 billion, $ 74 billion, USA 68.5 billion and $ 66 billion in South Korea And according to the US Census Bureau, followed.

“Just because these economies have initially changed tariffs, [it] This does not mean that you can breathe easily: “Stefan Angrick, Senior Economist at Moody's Analytics, told CNBC and emphasized that” Washington's mood could shift and the tariffs could still be imposed later “.

With the exception of Vietnam, thanks to their deep security relationships with Washington and large investments in the USA, Salvo's opening duties were spared, said Angrick, but “they shouldn't feel too comfortable.”

Vietnam -toothparts for Fallout

Vietnam is “undoubtedly one of the most exposed economies” in order to be a goal of Trump's trade restrictions, due to its great excess with the USA and the considerable Chinese investments in the country, said Angrick.

Clothing factory workers who work on May 24, 2019 in a factory in Hanoi, Vietnam.

Manground Vagaya | AFP | Getty Immos

Vietnam's trade surplus with the USA rose by almost 18% last year to a record high. According to WTO data, the simple average tariff rate of the country for MFN partner was 9.4%.

Drinks and tobacco that are imported into the country have an average of up to 45.5% tariffs, while categories such as sugar and confectionery, fruits and vegetables, clothing and transport devices are exposed to between 14% and 34% tariffs.

Trump, who described Vietnam as “almost the worst abuse” of trade practices in 2019, did no public comments about the nation after his re -election in November.

Hanoi has made efforts in recent months to find compromises with Washington on the trade. In November the country swore to buy more aircraft, liquefied natural gas and other products from the USA

The Vietnamese Prime Minister Pham Minh Chinh asked the cabinet members last week to prepare for the effects of a possible global trade war this year.

Vietnam was a main benefit of the commercial barriers, which Trump imposed on his first term for Beijing, which caused the manufacturers to get the production out of China. As a result, the Southeast Asian nation became one of the largest recipients of foreign direct investments from China.

The United States can double its tariffs to Vietnam to 8% if it enforces “full tariff resistance”, said Michael Wan, Senior Currency Analyst at Mufg Bank on Monday in a note. Nevertheless, he expects a less extreme US attitude in the country with “some sector-specific tariffs” to be more likely.

India reports on concessions

India could be most susceptible to “mutual” tariffs, since, according to several research companies, tariffs on US imports that are considerably steeper than US taxes for deliveries from India.

According to whom the Mufg Bank, the US tariffs in India could currently increase from 3% to over 15%.

Neu -Delhi in his union budget at the beginning of this month reduced the tariffs for a number of products, including motorcycles, electronic goods, critical minerals and lithium -ion batteries. In an interview, Finance Secretary Tuhin Kanta Pandey said that “we signal that India is not a tax king.”

The Indian Prime Minister Narendra Modi is reportedly prepared to discuss further tariffs in a dozen sectors and to buy more energy and defense equipment this week at his meeting with Trump.

Narendra Modi, India's Prime Minister, Links and US President Donald Trump, will come to a press conference in the Hyderabad House in Neu -Delhi, India on Tuesday, February 25, 2020.

T. Narayan | Bloomberg | Getty pictures

India's surplus with the USA, its third largest trading partner, reached $ 45.7 billion last year. In particular, the country's imported agricultural goods were exposed to high duties of 39%.

During Trump's first term in office, he had warm relationships with modes, but during his re -election, Trump had called India as a “very large abuse” with tariffs.

In a telephone call with modes last month, Trump emphasized how important it is that India bought more security equipment produced in the USA to achieve a “fair bilateral trade relationship”, according to the white house.

Some market observers had the idea that both sides can resonate the discussion about the long-awaited free trade agreement from US-India. The Joe Biden administration reported that India's interest in investigating a free trade agreement reported, reported Indian local media, citing trade and the country's industry minister.

“Such a deal would now require significant tariff reductions by Neu -Delhi, since it has much higher tariff quotas than Washington; Trump believes in a certain level of mutuality,” said Kenneth Juster, Distinguished Fellow am Council on Foreign Relations.

India could also offer to change its oil imports from Russia to the United States to change the plans of Trump to increase oil and gas exports in the USA, said Arpit CHADVEDI, South Asia consultant at Teneo.

Japan as most preferred nation

Japan seems to have secured a positive relationship with Trump and could “initially be shielded from higher tariffs”.

US President Donald Trump gives Japanese Prime Minister Shigeru Ishiba a book during a joint press conference in the east of the White House on February 7, 2025 in Washington, DC.

Andrew Harnik | Getty Images News | Getty pictures

According to WTO data, Tokyo maintains relatively low tariffs of around 3.7% in countries with MFN status. This indicates that “little scope for significant tariffs for Japanese goods,” said Kyohei Morita, chief -Japan economist at Nomura on Monday.

During the summit last week, Japan agreed to import more natural gas from the United States, and expressed interest in a project to deliver LNG via a pipeline from Nordalaska.

The two guides also agreed that Japan's Nippon Steel “invested strongly in the US company” instead of acquiring US steel. Japan will offer US steel for the manufacturers of products in the USA technology, said Ishiba.

Japan, who has been the largest foreign investor in the United States for five years, also undertaken to expand this investment of $ 783.3 billion to $ 1 trillion in 2023.

“While Japan cannot avoid all the effects of future US tariff policy, Tokyo can avoid targeted treatment with countries such as Canada, Mexico and China,” said James Brady, Vice President of Teneo in a Saturday letter.

“It can even hope for a mild trade treatment than other major economies, since it seems to enjoy the status of one of the most preferred nations from Trump,” said Brady.

China looks ready to speak

Chinese national flags fluttered on boats near ship containers in the port of Yangshan outside of Shanghai, China, February 7, 2025.

Go nakamura | Reuters

The Tit-for-Tat measures of Beijing-inliche 15% delivery for US carbon, liquefied natural gas, 10% duties for crude oil, agriculture, cars and pickup truck yields as modest and reserved.

The Tariff Package is Estimated to Cover $ 13.9 Billion Worth of China's Imports from the Us in 2024, According to Data Compile by Nomura, Accounting for 8.5% of China's Total Us Imports and Just 0.5% of China's Total Imports.

This is significantly lower than the US goods worth 50 billion US dollars that were targeted by Trump during the first term of office, said Tommy Xie, Head of Asia -makro Research at OCBC Bank on Monday.

The “calibrated approach” signaled that “China opts for a more diversified reaction”, with non-tariff countermeasures such as export controls and regulatory probes in US companies, while they also left the room for further negotiations, “added Xie .