Recent reports reveal that the US-China trade tensions could affect other economies as well such as the Southeast Asia. According to Lee Hsien, the Singaporean Prime Minister, increasing tensions between the two largest economies in the world could become and has become a major concern for Southeast Asian countries.
So far, the US Trump administration has issued a threat to impose tariffs on Chinese imports of up to $150 billion. However, the United States decision hasn’t been readily approved and accepted as Beijing announced that it would levy further tariffs on US goods in order to ensure a tit for tat response. However, it seems like China and US are not the only ones to suffer because of these trade tensions because these are going to have spill over affects and economies such as the Southeast Asia are going to suffer because of it.
So far, the Association of Southeast Asian Nations, that has 10 participating members are struggling with challenges for the region since it is based on a joint consensus and is not actively willing to get involved in different matters that concern its members internally.
Lee Hsien, the Prime Minister of Singapore, has shown serious concerns on Saturday that the US and China tensions could have a major impact on other Southeast Asian economies and this is something that a lot of them might not be willing to accept. Lee showed his concerns at the ASEAN conference and his remarks were directly linked to the US and China trade tensions and the effect that these could have on Southeast Asian economies.
The US and China are battling it out since the US announced that it would impose tariffs amounting to billions of dollars on Chinese goods and on the importation of goods that China actively buys. As a result, it was estimated that the tariffs are going to make the same products that China previously brought at lower prices, much higher and would affect China’s balance of payments directly. However, US’s decision to impose tariffs was not just a stand alone decision as while people were not readily accepting the country’s decision, China, in a retaliating move, announced that it is going to levy heavy tariffs on the import of US based goods. The Chinese tariffs are going to be in billions. Once China announced its response, it was clear that China is going to be battling it out with the US and is going to go head to head with the largest economy in the world.
However, it seems like the US and China are not the only ones who are fighting it out or are in this for that matter as other economies are going to benefit and lose because of their decisions. Singapore’s Prime Minister is one person who has actively commented on how these trade tensions are going to adversely affect other economies in Southeast Asia and things do not look good. Nonetheless, these trade tensions are going to have major spill over effects.