DIVISIONS AND MIXED Signs With German shares even tumbling to the biggest weekly loss in decades, the European Union’s business director, Maros Sefcovic, said he held a “frank” two-hour contact with US Secretary of Commerce Howard Lutnick and US Trade Representative Jamieson Greer. ” I was obvious: US tariffs areContinue Reading
SINGAPORE: A well-known venture capitalist on Friday (Apr 4) described how he came to trust alleged fraudster Ng Yu Zhi enough to put millions into a nickel investment scheme said to be a massive fraud.
Dr Finian Tan said the trust he placed in Ng, 37, was in part because Ng himself had invested in Vickers Capital Group (VCG) – of which Dr Tan was chairman – and one of its funds.
Dr Tan is the founder and chairman of Vickers Venture Partners, a global venture capital firm wholly-owned by VCG.
“He invested in us with no requirement at all, he never said ‘Oh I invest in you, can you invest in me?’
“He never solicited anything, he never asked me to invest, he just invested in us because he liked what we did,” said Dr Tan during the second day of his testimony in Ng’s trial.
Ng is contesting 42 charges: 15 counts of forgery, 14 counts of handling benefits from criminal conduct, 10 counts of cheating, two counts of fraudulent trading and one count of criminal breach of trust.
He is said to have duped 947 investors of almost S$1.5 billion (US$1.12 billion) through an elaborate scheme offering investors profits from the purported sale of physical nickel from 2016 to 2021.
Through his companies Envy Global Trading (EGT) and Envy Asset Management, Ng allegedly deceived investors that he was buying nickel at a discount and selling it for profit.
Prosecutors are saying that there was no underlying physical nickel trading activity, and investors were instead paid with money invested by other investors.
Dr Tan is said to be one of the victims who invested millions into Ng’s scheme.
Even before entering the contract, Dr Tan said he had spoken to other investors about their experience and received positive feedback. These people told him that they could withdraw their money on time.
Dr Tan also described how he had connected with Ng socially, as both had met each other’s wife and children, and visited each other’s homes.
“And very often when I was with him, he was checking nickel prices,” said Dr Tan, who described how Ng had even told him about a hurricane in Australia that purportedly occurred when his cargo was being loaded.
After the loading was completed, the two gave each other a “high-five”, Dr Tan said.
“It was an amazing act, knowing what I know now. Obviously at the time I took everything as bona fide, but he gained a lot of my trust,” said Dr Tan.
He repeated how Ng himself was an investor in VCG, but had never solicited for investments in return.
Dr Tan put a total of US$19.2 million into the nickel investment scheme over three contracts between October 2020 and January 2021.
He was promised returns of about 17 per cent for the first two contracts and about 15 per cent for the third. These contracts appeared “consistent” with what Ng had told him, with “nothing untoward”, Dr Tan said.
“Everything checked out and it was nothing surprising. And don’t forget he is also an investor of mine and he invested in the group, there was an element of trust,” said Dr Tan.
The court heard previously that Ng had committed to investing US$5 million in a Vickers fund, and another US$24 million – comprising US$13 million from Ng and the rest from six others – into VCG.
Of the US$19.2 million that was invested into the nickel scheme, about US$15.5 million belonged to Dr Tan while a shareholder invested about US$2 million.
Vickers staff who learned about the scheme from Dr Tan invested US$1 million, and about US$500,000 came from other partners.
Subsequently, at Dr Tan’s suggestion, two Vickers funds separately injected US$14.1 million into the nickel investment scheme through FinComm Group, an investment vehicle.
FinComm Group had two contracts with EGT in December 2020 and January 2021. These details form one of the charges against Ng.
Dr Tan was adamant that he would not have invested with EGT if the scheme lacked a supplier, buyers, or nickel.
“If there were any changes to the contract or deal in any shape or form, we must reassess (the risks and rewards to be had), however minute, and not having nickel at all is so major I can’t even describe it,” he said.
I don’t really think you may beat Trump’s tariffs by arguing with them sensibly or by explaining financial concept. I mean, how do you say with something like this?
I’ve resigned myself to the concept that the only way America is going to travel to the large revelation that broad-based tariffs are negative is to experience the adverse consequences first-hand — i. e., to reach the proverbial warm stove. Luckily, I think Americans properly be coming about very quickly:
But regardless, this is an economy website, and so even though I don’t expect it to give some political earnings, I thought I might as well explain why trade imbalances don’t make a country poorer ( though that doesn’t mean they’re Fine ).
Trump and his officials and sycophants believe that business imbalances constitute America being “ripped off” by foreign nations.  , As I explained in today’s blog, this is why Trump set his price prices at a level that he thinks may reduce America’s trade imbalance with each unique country.
Trump’s perspective of business deficits is based on two fundamental errors. The second is , a basic finance problem. Trump’s officials looked at the formula for GDP and noted that goods get subtracted from GDP.
They didn’t know that this is because goods even get , added , to use and investment, so you have to remove them at the end in order to eliminate them from the amount. The truth is that goods don’t change GDP one way or another.
Trump’s subsequent mistake is based on the idea that imports will be replaced 1-for-1 by domestic production — i. e., if you stop America from importing a cleaning system, an American company will make one more cleaning system instead. That’s certainly one , possible , outcome, but it’s not the only one. American consumers could just go without one washing machine, making everyone poorer.
In fact, Trump and his people probably don’t even realize these are two , separate , misunderstandings. They probably think that their mistaken belief about accounting ( i. e. that imports reduce GDP ) follows naturally from their mistaken belief about import substitution. The two mistakes mutually reinforce each other.
Anyway, because Trump misunderstands trade deficits in these two ways, he believes that when America runs a trade deficit with a country, that country is ripping us off. He thinks imports are lowering U. S. GDP by forcing us to produce less stuff — essentially,  , stealing American production. He thus sees trade deficits as a measure of how much is being stolen from America.
But that’s not actually how trade deficits work at all.
Suppose you import a washing machine from some Chinese guy named Ruimin. Why would Ruimin give you that washing machine? Nothing is free. Basically, you can pay for that washing machine in two ways. The first way is to give Ruimin something he wants — say, 50 interesting books ( Ruimin famously likes to read ). The second way is to write Ruimin an IOU. 1
The first case is called , balanced trade. You get a washing machine, Ruimin gets 50 books. There’s no trade deficit or surplus.
The other thing that can happen is , unbalanced , trade. In this case, instead of 50 books, you give Ruimin a US Treasury bond. A bond is an IOU. In this case, you’ve contributed to America ‘s , trade deficit , with China. A real good or service — the washing machine — went from China to America, and the only thing that went back in return was a slip of paper (or, actually, a number in a spreadsheet ).
At some point when you hear economists discuss trade, you might hear them talk about the” current account” and the” capital account”. The current account is basically just the net flow of real goods and services, 2 , and the capital account is basically just the net flow of IOUs.
If you give Ruimin an IOU in exchange for a washing machine, it means you’ve contributed to America ‘s , current account deficit, and you’ve also contributed to its , capital account surplus.  , Both of those things just mean “paying foreigners for stuff with IOUs”.
Now you can see why a trade deficit is like buying stuff with a credit card. When I buy a washing machine from Target with my credit card, I’m writing an IOU and I’m getting a tangible thing in return.
Does using your credit card to buy a washing machine from Target mean that Target has ripped you off? No. Does it make you poorer when you use your credit card to buy a washing machine from Target? Nope. You now have less money, but you have  , more stuff. In just the same way, a trade deficit means that the US has  , less money and more stuff. It does not mean America is poorer, or that it has been ripped off by foreigners.
Asking whether trade deficits are good or bad is like asking whether buying stuff with borrowed money is good or bad. The answer is pretty obviously “it depends on whether the purchase was worth it”.
One thing to remember is that not all purchases are for consumption — a lot are actually , productive investment. If an American factory buys a Japanese CNC machine tool for$ 100, 000, and the Japanese toolmaker simply stashes the money in US Treasury bonds, that contributes to the US trade deficit. But if the American factory uses that tool to make and sell$ 500, 000 worth of car parts, it has come out ahead — and America has come out ahead too.
This is what South Korea did when it was rapidly industrializing. Around 1980 and then again in the early 1990s, South Korea ran a trade deficit:
This was a time when South Korea was investing a huge amount in its industrial economy:
As an aside, in the late 70s and early 80s, at the same time it was running a trade deficit, Korea was also ramping up , exports , — not just in dollar terms, but also as a percent of its GDP:
Remember that exports add to GDP, while imports don’t subtract from GDP. So even as South Korea ran a big , trade deficit, trade was  , adding more and more to South Korea’s GDP , each year. A MAGA guy will have a very hard time wrapping his head around that fact.
But anyway, South Korea’s trade deficits at that time were probably worth it, because importing capital goods ( machinery, etc. ) helped them industrialize more rapidly than if they had had to take the time to make all those capital goods themselves. They just bought the machines and immediately used them to make cars and TVs and other useful stuff, much of which they sold to the rest of the world at a profit.
In fact, the US does some of this as well. When we think of U. S. trade deficits, we usually think of , consumption goods  , — cheap Chinese TVs and such. But the US also , imports a decent amount of , capital goods, which American companies use to produce and sell things. The US , did even more of this in the 1990s, when we ran a trade deficit but also had an investment and export boom.
But be careful here:” Using a trade deficit for investment” doesn’t mean” The trade deficit is good”. If companies import a lot of capital goods but see a low return on the investment, it can be bad.
Anyway, what about when you use trade deficits to buy consumption goods — those cheap Chinese TVs and Canadian-made cars and such? Consumption goods a majority of America’s trade deficit these days. Is , that , trade deficit good or bad?
In this case, we have to decide whether “buy now, pay later” is good or bad. Remember, a trade deficit is like buying something with a credit card. When America imports Chinese TVs and Canadian cars, and China and Canada get US Treasury bonds in exchange, it means that America now , owes China and Canada money.
At any time, China and Canada can choose to sell the bonds for dollars and use those dollars to buy US goods and services. If they eventually do this, then at that time, they’ll run , a trade deficit with the US.  , In that case, what basically happened is that the US , borrowed from China and Canada, and paid them back later.
This is just like if you buy a washing machine from Target with your credit card, then work to earn some salary, and then use your paycheck to pay off your credit card. Was this bad or good? It depends.
Maybe you could have just waited to get the washing machine until you had the cash in the bank. Or maybe it was worth it to you to get the washing machine now instead of waiting a few months, even though you had to pay a bit of interest on the credit card debt.
Buying consumer goods with debt can be a good financial decision or a bad financial decision. That’s basically what the US is doing when it runs a trade deficit with other countries.
It’s also worth mentioning that just like a credit card borrower, the US might never fully pay its foreign loans back. If the US experiences a burst of unexpectedly , high inflation, the US bonds that China and Canada hold will be devalued. 3 , That’s basically like a partial debt default. Or, if someday an irresponsible US leader comes along and defaults on the debt, China and Canada will see some of the value of their Treasury bonds evaporate into thin air.
So when the US runs a trade deficit with other countries, those other countries are taking a risk. They’re basically giving us a credit card that we can use to buy stuff that they make. There’s always the possibility that we might just declare bankruptcy and never pay them back.
So you could say that in a sense, countries that run trade deficits are more short-term focused, or less patient, than countries that run trade surpluses. Nations don’t really have motivations and personalities like that, but it’s not a terrible way to think about it.
The final question here is whether importing stuff from other countries causes America to make less stuff. Maybe if you buy some tomatoes with your credit card, it’ll mean you grow fewer tomatoes in your own garden as a result. And then when it comes time to pay back the credit card debt, you might have forgotten how to grow tomatoes. That’s basically what deindustrialization is. 4
Obviously, there are some cases where a trade deficit doesn’t cause deindustrialization. For example, in the case of South Korea in the 1980s and 1990s, we saw that trade deficits helped to , industrialize , the country and ramp up manufacturing. Something similar probably happened to the US in the 1990s.
But OK, we’re not talking about those historical cases, right? We’re talking about the trade deficits that the US has run in the last 25 years, mostly with China but also with a bunch of other countries. Those trade deficits were , mostly , America borrowing to consume, not to invest. The question is whether they resulted in America losing its manufacturing industries.
The answer, at least with regards to China, is “yes”. Autor et al. ( 2013 )  , famously find that “import competition ]from China ] explains one-quarter of the contemporaneous aggregate decline in US manufacturing employment]between 1990 and 2007 ]” . , Bloom et al. ( 2024 )  , find that Chinese import competition caused a big reallocation from manufacturing to service jobs on the West Coast and in big cities, but in the Midwest it mostly just caused wage declines and job losses. And , Acemoglu et al. ( 2014 )  , write:
In this paper, we explore the contribution of the swift rise of import competition from China to sluggish U. S. employment growth. We find that the increase in US imports from China, which accelerated after 2000, was  , a major force behind recent reductions in US manufacturing employment , and that, through input-output linkages and other general equilibrium effects, it appears to have significantly suppressed overall US job growth…Our central estimates suggest net job losses of 2.0 to 2.4 million stemming from the rise in import competition from China over the period 1999 to 2011. ]emphasis mine ]
You can just kind of eyeball this by looking at the raw data. Until 2001, when China joined the WTO and started exporting tons of cheap stuff to America, US manufacturing employment had held up pretty well over the years ( despite falling as a percentage of the total ). In the 2000s — the decade of the big Chinese import surge — it just fell off a cliff:
It’s worth noting that it wasn’t  , the trade deficit per se , that caused these job losses. Even if trade between the US and China had been balanced, Chinese import competition would probably have cost some US manufacturing workers their jobs, because A) some of the US exports would have been services instead of manufactured goods, and B) the US probably would have exported more capital-intensive goods, thus shifting away from the labor-intensive goods that China was good at making back in the 2000s.
But yes, the US trade deficit with China was huge, and caused significant deindustrialization. And the continued US trade deficit with China might be holding back US reindustrialization, both through import competition, and through China crowding US companies out of export markets.
So if you think manufacturing is important above and beyond its contribution to GDP ( as I do ), then the trade deficit with China is probably an important thing to address. But that doesn’t mean Trump’s tariffs are the right way to address it. I know that this is repeating stuff I’ve written in a lot of other posts, but this really bears repeating.
First of all, by making imported components more expensive, Trump’s tariffs are weakening US manufacturers — that’s why , auto workers , and , steelworkers , in the US are being laid off right now and why measures of manufacturing activity and sentiment are all , heading down. Second of all, Trump’s tariffs will ultimately reduce America ‘s , exports, not just its imports, both through exchange rate shifts, and through retaliation by other countries. That will hurt American manufacturing.
Tariffs on China might have been one part of a bigger strategy to improve America’s competitiveness in manufacturing. But broad tariffs on all of America’s trading partners, like the ones Trump just rolled out, are highly likely to accelerate America’s deindustrialization— even if they also reduce trade deficits. Ultimately, what’s important for the US isn’t to reduce imports — it’s to increase exports. Trump’s tariffs will only hurt that goal.
1 In practice, no one actually barters when they trade — no one actually trades books for washing machines. But when two countries have  , balanced trade, it means that they pay each other in currency that gets quickly used to buy some real good or service.
Ruimin gives you a washing machine, you swap some dollars to another Chinese guy for some yuan, you give the yuan to Ruimin, he uses the yuan to pay his doctor to treat his bad back, the doctor swaps the yuan for dollars, and then the doctor uses those dollars to buy 50 books from some other guy in America. That’s how balanced trade actually works.
2 It actually includes a few other things, but let’s keep it simple.
3 This is because the principal and interest on those bonds is specified in , US dollars, and inflation makes a US dollar worth much less in terms of real physical goods and services.
4 This could matter because A) you might need to grow your own tomatoes for a food fight, or B) forgetting how to grow your own tomatoes might make it harder to pay back your debt in the future. OK, so it’s not a great metaphor.
This article was first published on Noah Smith’s Noahpinion , Substack and is republished with kind permission. Become a Noahopinion , subscriber , here.
SINGAPORE: Employers today have instructions on how to handle workplace safety during solid winds, heavy rain, lightning, heatwaves and fog.
These new guidelines, to help workplaces prepare for adverse weather, were released by the Ministry of Manpower ( MOM) and Workplace Safety and Health ( WSH) Council on Friday ( Apr 4).
They come as climate change impacts international climate designs and leads to more unstable temperature in Singapore, said MOM and the WSH Council in a joint press release.
There were three deaths caused by severe weather in the past five decades, Senior Minister of State for Manpower Zaqy Mohamad told reporters , during a visit to the construction site for the Central Weave Build-to-Order straight project in Ang Mo Kio.
One occurred after strong winds toppled a pot, while two were related to thunder attacks.
One of the murders, on Jul 12, 2024, involved a contractor who was carrying out antenna setup works on an empty top. He collapsed after quiet storm was heard, and died the same day.
The new recommendations even come on the rear of , an advisory , issued last September urging companies to be prepared for stronger winds, hotter temperatures, longer dry spells and increased episodes of thunder and flash floods.  ,
While the actions announced on Friday are not required, employers and workers have responsibilities under the WSH Act to maintain healthy organizations, the regulators added.
For instance, companies may abide by laws protecting outside employees from the dangers of heat stress.
MOM said it will do checks to ensure the correct office safety measures are in place, and taking enforcement actions against employers and individuals who commit security lapses, they said.
Under the rules, companies are encouraged to assess the risks posed by severe climate, considering the precise nature of their business procedures, and prepare a response plan.
Stormy temperature, for example, causes security risks. Strong gusts over 60kmh may cause flying dirt and falling things, while floodwaters may damage structures and push away workers and objects, the guidelines position.  ,
While lightning, heatwaves and haze are less destructive, the guidelines urge employers to keep such weather in mind as well in developing comprehensive response plans.
” This includes clear communication systems, regular drills, and preparations to secure temporary structures and equipment”, said MOM and the WSH Council.
” Employers should also maintain communication with contractors to ensure their preparedness for adverse weather conditions”.
The guidelines urge employers to subscribe to alerts for strong winds, flash floods, lightning activity, heat stress and air quality.
Some of the recommendations to prepare for specific weather risks include:
MOM and the WSH Council said the recommendations were broad as employers have varying operational demands across industry and firm size.
The guidelines provide a foundation for employers to build upon, they added.
Workplace deaths in Singapore rose to 43 last year, with a rate of 1.2 deaths per 100, 000 workers.
Twenty of the deaths occurred in the construction sector. This was the highest among any industry.
The top three causes of workplace fatalities last year were vehicular incidents, suffocating or drowning, and collapse or failure of structures and equipment.
The excitement about synthetic intelligence is evident – turn on your phone now and it won’t be long before you are fed the next great AI-related history. In just a couple of years we have grown accustomed to AI helping us full simple daily tasks – from getting cafe advice to editing selfies.
But these capabilities sit at the very idea of the AI iceberg, only scratching the surface of what this paradigm-shifting technologies may achieve. Dig deeper and AI is set to change economy on a worldwide level. It is going to alter the way full industries operate and reinvent the nature of function within these sectors.
If the past few years have been about AI penetrating daily living, 2025 is going to be the year of AI for industries – and we will see a radical motion of the trip to professional autonomy as a result.
The AI opportunity across three compelling megatrends
The difference between industrial automation ( where we are today ) and autonomy ( where we are going ) is key to understanding this opportunity. While automation involves machines following pre-programmed instructions, autonomy leverages AI to enable systems to adapt and make decisions in dynamic conditions.
The path to full autonomy may be an incremental one for most industries, but many are already rapidly accelerating AI investments in pursuit of it. AI has immense transformative potential in almost all business areas, and companies are placing big bets to enable new ways of working, drive new business models and unlock new routes to growth.
We view global industry through the lens of three compelling megatrends – automation, the future of aviation, and the energy transition. Across all three megatrends, there is already a large installed base of highly connected technology and vast amounts of data that – with the right tools in place – create the perfect environment for AI to thrive.
AI can move us closer to energy security by dynamically controlling an increasingly complex and diverse energy mix and identifying inefficiencies across industrial operations in real-time.
In aviation, AI is a critical enabler of connected aircraft and, in the future, of autonomous flight that is central to a rapidly scaling advanced air mobility sector.
AI is also powering the operator copilots and predictive maintenance systems needed to maximize the safety and operational stability of complex, automated industrial plants.
These outcomes are becoming increasingly important to bridge the demand-supply gap of technologically skilled workers available to support industrial growth. The problem is getting worse, either as skilled workers retire with fewer fully skilled workers available to replace them or as economies scale rapidly without a skilled industrial talent pool that can keep pace.
AI-enabled autonomous industrial operations can directly address the skills shortage. Not by eliminating workers but by providing AI-powered tools that can train and upskill them, helping even inexperienced workers perform like seasoned experts and loosening one of the binding constraints to growth.
AI will change the nature of industrial roles to make them more strategic, while allowing tomorrow’s workforce to jump quickly into jobs that they’ll find more challenging and rewarding, enabled by the power of new technologies at their fingertips. It is imperative that workers are equipped with the tools and the learning opportunities to embrace AI in their jobs and be prepared to explore its potential to avoid being left behind.
The’ technology trifecta’
Another driver is that, until recently, the huge volume of industrial data that has been growing exponentially over the past decade has largely been locked within local machine loops.
Put simply- the technologies to free it from its silos, aggregate and analyze it in one single place have not existed. Industrial datasets can be vast and lack the connectivity to transfer them, large repositories to store them, and powerful data processing capabilities to convert them into actions.
This is what we call the’ technology trifecta’ of 5G, cloud and AI, and it is turning the theory of autonomy into an industrial reality. By bringing these elements together, industrial companies are now finally able to leverage the full extent of their operational data to make every day their best day of production.
Their success will be determined by the ability to connect their Operational Technology ( OT ) – the patchwork of physical sensors, systems and controllers within a typical industrial operation– with the Information Technology ( IT ) infrastructure at a large scale. And, by connecting their OT in this way, they will also need to make the right cybersecurity investments to ensure their entire OT and IT infrastructure is secured from increasingly sophisticated threats.
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The right partnerships for AI-led transformation ,
These technical hurdles can be solved today through cross-industry partnership on AI. That is why we are already working closely with some of the world’s leading firms in the areas of connectivity, cloud and AI to bring the right solutions to market.
For example, Honeywell Forge, our IOT platform, transforms data into insights across virtually any industrial operation. To help achieve this, the platform can harness the power of Microsoft Azure’s cutting-edge cloud and AI capabilities to help operational workers identify opportunities across digitalization, energy optimization, asset reliability, OT cybersecurity, and building efficiency.  ,
In another example, we recently announced a collaboration with Google to bring its Gemini Large Language Model and Vertex, Google Cloud’s AI platform, together with enterprise-wide industrial data from Honeywell Forge. This convergence of tools and data supports the rapid upskilling of a remote workforce and enables predictive maintenance – which reduces downtime and increases productivity.
We are also expanding partnerships across semiconductors and technology architecture – working with leaders including NXP and Qualcomm to ensure AI can be enabled at the edge across a wide range of applications from refineries to warehouses and even aircraft cockpits.
To complete the ecosystem we are adding the advanced capabilities of telecommunications providers like Verizon, to leverage their 5G capabilities for the transfer of large datasets from edge-to-cloud.
Such partnerships are important because they combine deep domain and data expertise across industries with the very latest technologies across the’ trifecta’ to finally make industrial AI accessible.
Industrial businesses around the world are now poised to turbocharge the path to autonomy, and in 2025 we will see bold bets made in industrial AI technologies that are going to radically increase productivity, improve efficiency and unlock much-needed growth.
Anant Maheshwari is President and CEO Global Regions, Honeywell
It takes a truly incredible impact to drive the global market into crisis. Did Donald Trump’s bilateral tax strategy simply shove the earth into one?
Eastern policymakers can’t help but fear the worst as the area bears the overwhelming weight of the US president’s worldwide revenge tour.
Liberation Day? More like” Obliteration Day”, quips Neil Dutta, economist at Renaissance Macro Research, as about US$ 2.5 trillion was erased from the S&, P 500 Index on Thursday ( April 3 ) alone. Now, economists at JPMorgan worry a Trump downturn is likely.
” This affect alone could get the business perilously close to slipping into crisis”, says JPMorgan analyst Michael Feroli. ” And this is before accounting for the more visits to total imports and to purchase spending”.
Feroli thinks Trump’s tariffs will add as much as 1.5 % to already rising prices this year, using the core personal consumption expenditures (PCE ) index, the Federal Reserve’s preferred inflation gauge. The taxes also did bang individual wages and consumer investing in the US, he predicts.
Any large dispositions in the US would resonate Asia’s method almost instantaneously. But Trump’s about straight focus on Asia is because self-defeating as it is harmful.
Trump’s concerns are very much on screen. China, for example, now faces a 54 % tax on all supplies to the US. On April 2, Trump slapped an additional 34 % tariff on top of an earlier 20 %. Vietnam, however, faces a 46 % price.
Vietnam’s place in the line of flames stems from the mistakes of the Trump 1.0 time. Most of the work that Trump thought had tilt from China to the US went to Vietnam otherwise. It was the China solution of choice for firms from American Eagle to Deckers to Hasbro to Nike to Wayfair.
Trinh Nguyen, top analyst at Natixis, speaks for many when she calls the income “devastating for Vietnam”. As such, Trump may have just raised the prices of clothing, furniture and toys manufacturers everyday. Cost hikes for customers around the globe are all but certain.
Like some developing Asian economies, Vietnam is far more probable to communicate than fight. ” Vietnam is extremely unlikely to observe Canada or Europe in applying mutual taxes. At present, it imports to some US products to establish any real pain”, says Craig Martin, president of Dynam Capital.
Japan and South Korea got off easier with tariffs of 24 % and 25 %, respectively. But without moves by Tokyo and Seoul to placate Trump, it’s unclear how Asia’s No 2 and No. 4 economies avoid bigger levies.
The question now is whether Trump’s truly epic shock causes a catastrophic global downturn. There have been two such events since the 1990s: the 2008-09 global financial crisis and the Covid-19 pandemic. Though the 1997 Asian financial crisis came close, it didn’t send the West into a tailspin.
This Trump 2.0 assault on the global trading system could indeed be the third such economic earthquake in 17 years – and an inflection point for the global financial system.
If these actions are “implemented, the effective US tariff rate would be higher than the Smoot-Hawley Act rate”, says Priyanka Kishore, economist and founder of consultancy Asia Decoded. ” The estimates range between 26 %-29 % compared to around 20 % in the 1930s”.
This, she notes,” challenges our view of resilient US growth this year. While we expected the Trump administration to act swiftly on tariffs, the scale and scope have exceeded our expectations. With heightened policy uncertainty and rising downside risks to investments, we now anticipate US growth to falter in the coming months”.
Part of that problem – and the disorientation – is that the logic behind it is completely nonsensical.
” If a 9th grader in high school presented this tariff chart to a teacher in a basic economics class, the teacher would laugh and say sit down and work on the assignment”, says Dan Ives, an analyst at Wedbush Securities.
Jeffries analyst W Brad Bechtel adds that “our textbooks tell us that tariffs are inflationary if the currency market does not adjust to offset. The dollar dropping 2 % amid the addition of tariffs around the world on US imported goods is very inflationary“.
Kevin Thozet, an investment committee member at Carmignac, notes that” this is the US economy flirting with recession this year and inflation reaccelerating. And this is before we get the next wave of sectoral tariffs, which Trump mentioned again on chips, pharmaceuticals, copper, timber and shipping services”.
Analysts are counting the ways that Trump’s tariffs will backfire. In 2024, the US exported$ 2.1 trillion in goods and$ 1.1 trillion in services.
If his taxes on imports send other top economies into recession or even crisis, the fallout for US growth could be devastating. And that’s even before America’s biggest trading partners hit back with retaliatory tariffs.
” This is a game-changer for the global economy”, says Fitch Ratings economist Olu Sonola. ” Many countries will likely end up in a recession”.
Japan, for example, may seem to have gotten off easy relative to China. But the 25 % tax Trump slapped on all imports of automobiles and car parts already has economists upping the odds of Japanese stagflation.
It’s not just Japan facing a scenario where growth flatlines and inflation accelerates, though. Stagflation scenarios now stalk the US as well.
” An increasing probability of stagflation risk in the US may see further narrowing of the two-year sovereign yield premium spread between US Treasuries and Japanese government bonds”, says Kelvin Wong, senior market analyst at brokerage OANDA.
Wong adds that recent policy shifts” suggest a rising risk of stagflation in the US economy due to uncertainties in growth prospects and the cost of living, which are exacerbated by the current US White House’s erratic and aggressive trade tariff policy”.
China, though, is grappling with deflationary pressures. Trump turning the screws tighter on China could send mainland prices even lower.
The latest US tariffs “limit China’s ability to rely on stimulus and raise long-term export costs”, says Lauren Gloudeman, an analyst at Eurasia Group. ” The usual playbook of domestic stimulus will be constrained. More spending will risk inflating local government debt while deeper rate cuts could hurt banks. Beijing will opt for central government-led infrastructure investment”.
Beijing has been preparing exporters through low-cost financing and tax rebates. ” But”, Gloudeman says,” the removal of the de minimis rule will deal a heavy blow to employment, as it affects the labor-intensive segment of the export sector”.
Though China’s share of global trade is rising, headwinds bearing down on US households raise question marks on the$ 3.3 trillion the US imported last year. If US imports disappear under the weight of Trump’s tariffs, so would a key driver of global growth. That’s the last thing export-dependent economies from China to Germany want.
One concern is the so-called “wealth effect” kicking into reverse. Just as rising stocks make average households more confident, plunging shares often slam sentiment. UBS Group analyst Bhanu Baweja thinks the S&, P 500, which is now at 5, 396, could be headed even lower.
” We see 5, 300 as the near-term target for the S&, P 500, but if tariff uncertainty persists or negotiations with trading partners don’t go well, risks of downside through 5, 000 become real”, Baweja says. ” The probability of US stocks entering a bear market is going higher”.
The huge drop in shares of financial companies is ringing alarm bells of their own. They include Citibank ( down 12 % on Thursday alone ), Bank of America (-11 % ), Morgan Stanley (-9.5 % ) and JPMorgan (-7 % ).
” Although financials don’t have direct exposure to tariffs, the uncertainty and ensuing market volatility around the indirect impact of broad-based tariff increases on the economy and activity levels is likely to dominate bank stocks in the near term”, says Jim Mitchell, an analyst at Seaport Research Partners.
The violent stock selloff that shook the region on Thursday dramatized Asia’s place in Trump’s trade destruction. Japan’s benchmark Nikkei 225 Stock Index tumbled more than 4 % at one point yesterday, Korea’s Kospi index dropped 2.7 %.
Japan’s Chief Cabinet Secretary Yoshimasa Hayashi called the new levies “extremely regrettable”, warning they’re likely to have a” significant impact on the economic relationship between the US and Japan”.
Wishful thinking, perhaps, but Hayashi said Tokyo would “take all necessary measures” to ensure its economy isn’t hobbled by such tariffs.
Korea’s acting President Han Duck-soo called on the government to “exert all its capabilities to overcome the trade crisis” at an emergency meeting on Thursday, calling the related uncertainty “extremely serious”.
China’s Communist Party slammed Trump’s move as a “typical unilateral bullying practice” and said it would “resolutely take countermeasures to safeguard its own rights and interests”.
Beijing “urges the United States to immediately cancel its unilateral tariff measures and properly resolve differences with its trading partners through equal dialogue”, the Commerce Ministry said in a statement.
” As we had worried, Asian economies have been hit hard by the new tariff announcements”, said Decoded’s Kishore. Outside of China and Vietnam, Trump’s tariffs hit Taiwan ( 32 % ), Thailand ( 36 % ) and Indonesia ( 32 % ). Malaysia’s 24 % was in line with Japan and Korea, as was India at 26 %. The Philippines ( 17 % ), Singapore ( 10 % ) and Australia ( 10 % ) fared slightly better.
” Whatever be the outcome, the increased economic uncertainty is likely to take a toll on sentiments and spending in the foreseeable future”, Kishore says.
” We will be following up with a more detailed note on the channels through which the tariff shock will likely flow through Asian economies and to what degree. Several indirect and spillover impacts need to be considered”.
Former Treasury Secretary Lawrence Summers worries Trump’s latest tariff hikes could trigger an oil crisis-like shock to the globe’s biggest economy.
” This is the kind of thing you discuss in the way we would usually discuss an oil-price spike or earthquake or a drought, as a supply shock”, Summers tells Bloomberg. ” The question is mostly how much damage is going to be done”.
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Both Malaysia and Indonesia have much thinner vehicle business links with the US, with the countries ‘ full vehicle parts exports to the US worth US$ 86.3 million and US$ 73.8 million both in 2023, according to the UN trade figures.
While not all South Asian countries does face serious economic impacts following the introduction of the new tariffs, the ripple effects may mean their mechanical industries will face fresh market dynamics.
For example, Archanun feels that North Vietnamese carmakers- considered comparatively smaller global players that also produce most of their cars directly- will try to “divert” their car sales from the US to countries like Thailand.
” That seems to be in line with what we observed in Thailand, where Asian carmakers like Kia or Hyundai are participating in a price war intensively”, he said, noting that sticker rates on some models were slashed by roughly 25 per cent.
It is worth noting that ahead of the tax date, Hyundai had announced it had spend US$ 21 billion in the US by building a new metal plant in Louisiana. Whether that move reaped any concessions with the Trump administration is unclear.
Likewise, larger Original Equipment Manufacturers ( OEM)- global carmakers such as Toyota that Southeast Asian countries largely serve as local parts suppliers- will also be looking for alternative opportunities given that their vehicles are likely to be priced out of the US market, Patarapong said.
The solution may end up largely being within Southeast Asia itself, he suggested, contending that the impact of trade barriers to the US could in time be supplemented by a rise in intra-ASEAN trade, coupled with more investments within the broader ASEAN 6 group, which includes China, Japan, South Korea, Australia, New Zealand and India.
” I think ( the industry in Southeast Asia ) can weather the storm to some extent”, he said. ” In the long term, we think it may not be so bad”.
He expected more investment from countries such as China in the regional automotive industry because it wants” to rely more on the regional value chain rather than the US market”.
” For Japan, I think they will not withdraw their investments very easily, because right now they need to make sure that their investment is something controllable and ASEAN is like a backyard of Japan.
” You can also see more and more investment by the Korean automotive sector in ASEAN too, especially Vietnam and Indonesia. That’s going to increase over time, “he said.
Hyundai has invested US$ 415 million in Vietnam and employs about 2, 300 people, with annual revenues of around US$ 2.6 billion.
International businesses serving the auto industry with presence in Southeast Asia, like Desoutter Industrial Tools, are already trying to chart a course where they no longer have dependence on the American market.
But they are” hesitating” about where and when to invest given the pace and unpredictability of Trump’s policy-making, according to Glenn Heed, the global business manager for the motor vehicle industry at Desoutter, which provides automotive assembly tools and process control technologies to major carmakers around the world. It has operations in Thailand, Malaysia, Indonesia and Vietnam.
” The economy is breaking or slowing down just because of the uncertainty,” Heed said”. Of course, I’m worried. But this affects everyone. It’s how agile you are. What kind of decisions are you taking? I do think it’ll be like this for a long time, so we are trying to change the way we see the world, “he said.
Importantly, he sees the” possibility to increase partnerships with neighbours and other parts of the world”, and drive the rise of” local for local “production.  ,
” Over a long time, I think it could be a positive thing for the rest of the world. ”  ,  ,
But Archanun cautioned that a self-serving strategy in Southeast Asia alone could not fill the gap for companies losing out on American business.  ,
He forecasted that demand for durable goods like vehicles would drop in the months to come given the broader economic shocks expected following the tariffs introduced to countries all around the world.
That could lead to strong competition among automakers facing constrained consumer demand in this region.
” The cake will be smaller. They will have to fight very fiercely in this market, “he said.
BBC News, Sydney
Annelise ReesTwo small, isolated Antarctic outposts populated by birds and seals are among the mysterious sites targeted by the Trump administration’s new taxes.
Heard and McDonald Islands- a country which sits 4, 000km (2, 485 miles ) south-west of Australia- are just available via a seven-day boat journey from Perth, and haven’t been visited by humans in nearly a century.
President Trump on Wednesday unveiled a sweeping trade tax system, in retaliation for what he said are unjust trade restrictions on US items.
A handful of other American lands were also hit by the new taxes, in addition to the Norwegian island Svalbard, the Falkland Islands and The British Indian Ocean Territory.
” It only shows and exemplifies the fact that nowhere on Earth is protected from this”, American Prime Minister Anthony Albanese said on Thursday.
Like the rest of Australia, the Heard and McDonald Islands, the Cocos ( Keeling ) Islands and Christmas Island are now subject to a tariff of 10 %. A tariff of 29 % was imposed on the Norfolk Island, which is also an Australian territory and has a population of about 2, 200 people.
Heard Island, though, is barren, snowy and entirely uninhabited- home to Australia’s largest and merely active volcano, Big Ben, and generally covered by glaciers.
It is believed the last time people ventured on to Heard Island was in 2016, when a group of amateur radio enthusiasts broadcasted from there with permission of the Australian government.
Mike Coffin, from the University of Tasmania, has made the journey to the surrounding waters seven times to conduct scientific research, and is sceptical about the existence of major exports from the island to the US.
” There’s nothing there”, he told the BBC.
As far as he knows, there’s only two Australian companies which catch and export Patagonian toothfish and mackerel icefish.
What is in abundance, however, is unique and spectacular nature.
Richard ArculusThe islands are listed by Unesco World Heritage as a rare example of an ecosystem untouched by external plants, animals or human impact.
” It’s heavily colonised by penguins and elephant seals and all kinds of sea birds”, said Prof Coffin, who studies the undersea geography of the islands.
He recalls observing from afar what he thought was a beach, only the sands “turned out to be probably a few 100, 000 penguins”.
” Every time a ship goes there and observes it, there’s lava flowing down the flanks ]of Big Ben ]”, he said, describing it sweeping over ice and sending up steam.
It’s hard to get a clear picture of the trade relationship between the Heard and McDonald Islands and the US.
According to export data from the World Bank, the islands have, over the past few years, usually exported a small amount of products to the US.
But in 2022 the US imported US$1.4m (A$2.23m; ) from the territory, nearly all of it unnamed “machinery and electrical” products.
The US Department of Commerce’s International Trade Administration and Australia’s Department of Foreign Affairs and Trade has been contacted for comment.
As with many governments around the world, the tariffs have frustrated Australia’s leaders, with Albanese saying they are “totally unwarranted” and “not the act of a friend.”
The Malaysia Digital Economy Corporation ( MDEC ) successfully spearheaded Malaysia’s presence at LEAP 2025, a global technology conference held in Riyadh, Saudi Arabia from Feb 9 to 12. This proposal reinforced Malaysia’s part in Saudi Arabia’s modern transition and opened new avenues for cross-border partnerships and digital business investments.
Over the course of four days, the Malay group, comprising technology firms and business leaders, engaged in extensive firm matching sessions, discussions, and studied relationship opportunities within Saudi Arabia’s expanding technology ecosystem. With a focus on AI, big data analytics ( BDA ), smart cities, fintech, cybersecurity, and semiconductor solutions, Malaysian companies garnered significant interest from Saudi industry leaders keen to explore collaborative opportunities.
The Indonesian group consisted of:
Each brought cutting-edge options, contributing to meaningful discussions on the future of AI, automation, and online network within Saudi Arabia’s Vision 2030 model.
A spotlight of the vision was a networking breakfast held. Jointly organized by MDEC and the newly minted Malaysian Professional Council – Riyadh ( MPCR ), the event provided an invaluable platform for fostering relationships between Malaysian and Saudi tech leaders. The breakfast facilitated discussions on investment opportunities, business development methods, and joint ventures aimed at strengthening diplomatic ties in the modern economy.
Strengthening diplomatic technical assistance
The invitation-only meal, attended by Indonesian executives and Royal organization leaders, underscored Malaysia’s devotion to deepening its modern footprint in the Middle East. Indonesian visitors included:
The night served as an opening for MPCR, an program designed to integrate and support Indonesian professionals in Saudi Arabia. With MPCR acting as a bridge for knowledge exchange and business development, the council hopes to play a pivotal role in facilitating cross-border trade and investment in the digital and tech sectors.
Local partnerships and market accessibility
Haekal, who has successfully established partnerships with two Saudi nationals, highlighting the ease of collaboration and the favorable environment for foreign businesses looking to enter the market.
” The Saudi business landscape is incredibly welcoming to foreign partners where Saudi funding is aplenty, especially those bringing innovative ideas and solutions. Within a short period, I was able to connect with two Saudi partners who share my vision for growth and expansion. The regulatory framework and government initiatives make it easier than ever to establish partnerships and go to market with the right ideas”, said Haekal.
He emphasized that Saudi Arabia’s push for digital transformation aligns well with Malaysia’s expertise, and the synergies between the two Muslim nations provide a solid foundation for future collaborations. ” It’s an exciting time for businesses looking to enter this market. The demand for technology-driven solutions is immense, and Malaysia is well-positioned to contribute”.
MoU to enhance Malaysia-Kingdom of Saudi Arabia tech collaboration
MDEC and the Federation of Saudi Chambers ( FSC ) signed an MoU with MDEC represented by Nizam Rosli, Global Alliance, Digital Exports, with Abdulghani Al Rumaih, Chairman, Saudi Regional Council for South East Asia, representing FSC. The MoU is seen as a commitment to foster business expansion, digital trade and investment between tech companies in both nations.
The MoU paves the way for structured business matching, networking, ecosystem development, and joint promotional efforts to accelerate digital growth across both nations.
Nizam outlined the key expectations and objectives. ” MDEC and the Federation of Saudi Chambers of Commerce ( FSCC ) will undertake a range of collaborative activities with the goal of uplifting trade and investment opportunities for tech companies in both markets. This includes fostering innovation pipelines through public and private ecosystem builders, providing platforms for knowledge exchange, and facilitating participation in business events such as networking sessions, dialogues, conferences, exhibitions, and workshops”.
Immersing in the MENA tech ecosystem
Beyond formal business engagements, the Malaysian delegation actively participated in LEAP Nights, exclusive networking receptions that connected global tech leaders with Saudi stakeholders. Notably, attendees experienced the vibrant energy of Riyadh’s evolving tech landscape at events hosted by 500 MENA, KAUST Innovation, and Endeavor Saudi Arabia, further strengthening ties with regional venture capitalists, ecosystem builders, and tech innovators during Riyadh’s cold winter nights.
With the Kingdom of Saudi Arabia’s ambitions to grow into a global tech player, Malaysia’s proactive engagement at LEAP 2025 underscores its readiness to contribute to and benefit from the region’s digital transformation. The collaborations forged during this mission mark the beginning of an exciting chapter for Malaysia’s digital economy expansion in the Middle East.
As MDEC and Malaysian tech companies continue their efforts in Saudi Arabia, the prospects of enhanced digital trade, investment, and knowledge exchange signal a promising future for both nations in the global digital economy.
Malaysia-Saudi trade overview
In 2023, total trade between Malaysia and Saudi Arabia was valued at approximately US$ 11.54 billion ( RM51.27 billion ). Key sectors contributing include:
]RM1 = US$ 0.225 ]
Muhammad Adrian Wong is a Contributing Editor to Digital News Asia. He attended LEAP 2025 on his own diem.
Two weeks into US President Donald Trump’s subsequent word, the liberal global order is on life support.
Alliances and international organizations are now seen by the United States as obligations. Europe and NATO are framed as bad company, “ripping off” the US. On his so-called” Liberation Day”, Trump even imposed 20 % tariffs on all European Union goods.
The Trump presidency has been far less important of the US ‘ relationships in the Indo-Pacific place. On a visit to Tokyo this year, US Defense Secretary Pete Hegseth described Japan as America’s “indispensable partner” in deterring Taiwanese anger.
But, Japan and South Korea fared even worse than the Union with Trump’s fresh tariffs. Trump slapped Japan with 24 % tariffs and South Korea 25 %. ( Both countries enjoy a trade surplus with the US. )
But, how are the US ‘ two key supporters in the Indo-Pacific dealing with the capricious US head? Did they follow Europe’s result in reassessing their personal safety relationships with the US?
America’s post-war protection plan in Asia contrasts from Europe. While NATO was built on the premise of shared military among its users, the US adopted a “hub-and-spokes” type in Asia, relying on diplomatic relationships to contain the spread of communism.
Japan and South Korea have huge sheltered under the US nuclear umbrella and held big US military bases. Both are also very sensitive to changes in the US ‘ Indo-Pacific policies.
Japan, in particular, has a long history of cautious empire control with the US, epitomised by former Prime Minister Shinzo Abe’s courting of Trump.
During Trump’s first term in office, Abe’s plan targets aligned strongly with the US: transforming Japan’s security position to make it a serious military and diplomatic energy. Japan increased defense spending, lifted hands trade restrictions and increased ties with India and Australia.
Prime Minister Fumio Kishida continued to raise Japan’s safety profile from 2021-24, once increasing military investing and taking a hard line on Russia’s invasion of Ukraine. He emphasised” Europe today may become Asia tomorrow”.
His son, Shigeru Ishiba, had a successful conference with Trump in February, soon after his opening. The mutual declaration reaffirmed US protection promises to Japan, including over the Senkaku Islands, which are claimed by China.
Japan even agreed to buy American liquefied natural gas, and eventually committed to working with South Korea to build a US$ 44 billion plan to import LNG from Alaska.
Nevertheless, these positive advancements do not think the marriage is on solid ground.
In early March, Trump complained the US-Japan security agreement signed in 1960 was “one-sided” and a top administration official again called for Japan to increase its defence spending to 3 % of gross domestic product ( GDP ) – a huge increase for a country facing serious demographic and fiscal pressures.
Reports even emerged the US was considering cancelling a new shared headquarters in Japan aimed at deeper connectivity between US and Japanese forces.
South Korea faces comparable pressure. Ties between the two countries were strained during Trump’s first word over his require South Korea increase the amount it pays to network US troops by nearly 400 %. A 2021 deal restored some security but left Seoul seriously worried about the future of the empire.
South Korea’s operating leader, Choi Sang-mok, has expressed a desire to improve relations with the US, though Trump has apparently been great to his improvements.
With a$ 66 billion trade surplus with the US, South Korea is considered the country most vulnerable to trade risk with the Trump administration, according to a Swiss research group.
Trump’s prior recommendations that both South Korea and Japan develop nuclear weapons or compensate for US atomic security has also rattled some emotions. As trust in the US empire diminishes, both places are engaging in an urgent public debate about the possibility of acquiring nuclear weapons.
Potential for conflict is on the ocean. For instance, Tokyo and Washington are set to renegotiate the deal that dictates how much Japan pays to host US soldiers next month.
Both friends pay large sums to host US foundations. South Korea will pay$ 1.14 billion in 2026, and Japan pays$ 1.72 billion annually.
A trade conflict may also enable a reevaluation of the expenses of US efforts to detach from China, possibly leading to closer economic ties between Japan, South Korea and China. The three countries have agreed to accelerate talks on a trilateral free trade agreement, which had been on hold since 2019.
Another challenge is semiconductors. Japan’s new semiconductor revitalisation strategy is prioritising domestic investment, raising questions about whether Trump will tolerate “friendshoring” if Japan diverts investments from the US.
In 2024, Japan outspent the US in semiconductor subsidies ( as a share of GDP ), while Taiwan’s TSMC, the world’s largest contract chipmaker, expanded its production capacity in Japan.
Seoul remains an important partner to Washington on semiconductors. Samsung and SK Hynix are both boosting their investments on new semiconductor plants in the US. However, there is now uncertainty over the subsidies promised to both companies to invest in America under the CHIPS Act.
Ultimately, the strength of these alliances depends on whether the Trump administration views them as long-term bulwarks against China’s rise in the region or merely vassals that can be extorted for financial gain.
If the US is serious about countering China, its regional alliances are key. This would give Japan and South Korea some degree of leverage – or, in Trump terms, they’ll hold valuable cards. Whether they get to play them, however, depends on what Trump’s China policy turns out to be.
Sebastian Maslow is associate professor of international relations, University of Tokyo and PaulO’Shea is senior lecturer, Centre for East and South-East Asian Studies, Lund University
This article is republished from The Conversation under a Creative Commons license. Read the original article.
