More stringent tariffs could force businesses to relocate full industrial ecosystems in his second term. South Asian nations are well-positioned to provide themselves as steady and trustworthy alternatives to high-tech supply chains.
Thailand’s Commerce Minister Pichai Naripthaphan sees opportunity back, noting,” Trump’s win may be useful for Thailand because Republicans are pro-business, and the US-China trade war will continue and effect in more opportunities”.
However, realising this opportunity wo n’t be straightforward. It requires moving beyond low-cost production to create more advanced value-added features. The US may also exert pressure on ASEAN nations or initiate immediate action to restrict Chinese influence in key areas.
A CRITICAL TEST FOR ASEAN
In the upcoming years, Southeast Asia will have to put up a significant check.
Following the initial trade war, China’s developments in emerging industries like electrical automobiles and clean energy technologies present a new concern for ASEAN. ASEAN must balance geopolitical concerns with priorities for business growth because of China’s cost advantages and dominance in these industries, which makes it harder to realize substantial diversification of supply chains.
Balancing the pressures of Trump’s business plans with relationships with both the US and China may involve agility, vision and assistance.