Historic Context: China’s ASEAN Moves Reshape Business Amid Tariff Tensions
Summary
China is strengthening ties with Vietnam, Malaysia, and Cambodia to offset the impact of U.S. tariffs—some exceeding 100%—and position itself as a more stable trade partner in Southeast Asia.
Decades of Sino–ASEAN integration—including the China–ASEAN Free Trade Area (ACFTA) and later RCEP—have fostered deep interdependence, particularly in electronics, textiles, and infrastructure.
Successive U.S.–China tariff conflicts, starting in the 1990s and escalating during the 2018–2020 trade war, propelled supply-chain shifts and prompted Southeast Asian nations to diversify partners.
Vietnam’s flexible “bamboo diplomacy” seeks balance between China and the U.S., while Cambodia remains closely aligned with Beijing, reflecting diverse strategies within ASEAN.
Businesses face heightened risks but also opportunities, from potential new manufacturing hubs (“China+1”) to expanded consumer markets as ASEAN’s middle class grows.
Proactive strategies—such as multi-site production, close monitoring of tariffs, and local partnerships—help companies manage volatility and capitalize on a region becoming ever more central to global commerce.
