TOKYO: Some Asian countries stand to gain if US president-elect Donald Trump pushes ahead with his promised massive tariffs on China and triggers a new wave of factory relocations to the rest of the region.
But a trade war between the world’s biggest economies would also destabilize markets everywhere, with Asia — which contributes the largest share of global growth — the most affected.
Trump, who won a crushing presidential victory this week, vowed during his campaign to slap 60 percent tariffs on all Chinese goods entering the United States in an attempt to balance trade between the two nations.
Analysts however question whether the new president will stick to such a high figure, and dispute the blow such tariffs could inflect on the Chinese economy, estimating GDP could be lowered by between 0.7 percent and 1.6 percent.
The cooling effect would also make waves throughout Southeast Asia, where production chains are closely linked to China and enjoy significant investment from Beijing.
“Lower US demand for Chinese goods due to higher tariffs on China will translate into lower demand for ASEAN exports, even if there aren’t US tariffs levied directly onto those economies,” said Adam Ahmad Samdin, of Oxford Economics.
Indonesia is particularly exposed through its strong exports of nickel and minerals, but China is also the top trading partner of Japan, Taiwan and South Korea.
In addition to China, Donald Trump has also warned of an increase of 10 to 20 percent on duties for all imports, as part of his protectionist policies and fixation that other countries take advantage of the US.
“The extent of these effects likely depends on the direct exposure of each economy to the US,” said Samdin, who added that America accounts for a 39.1 percent share of Cambodian exports, 27.4 percent from Vietnam, 17 percent from Thailand and 15.4 percent from the Philippines.
Trump first slapped China with heavy tariffs in 2018 during his first administration, leading to the emergence of “connector countries,” through which Chinese companies passed their products to avoid American taxes.
Those countries could be in the line of fire now.
“Vietnam’s electronics exports to the US could also be targeted by Trump, in a bid to halt the diversion of Chinese electronic products to the US via Vietnam since 2018,” said Lloyd Chan, a senior analyst at MUFG, Japan’s largest bank.
“This is not inconceivable. Trade rewiring has notably gained traction in the region’s electronics value chain.”
“India could itself become a target of protectionist measures by the US due to the large share of Chinese components in Indian products,” added Alexandra Hermann, an economist with Oxford Economics.
Trump could also impose higher tariffs on Indian goods in sectors such as “automobiles, textiles, pharmaceuticals and wines, which could make Indian exports less competitive in the US,” said Ajay Srivastava of the New Delhi-based Global Trade Research Initiative.
A trade war would be dangerous for India, said Ajay Sahai, director of the Federation of Indian Export Organizations.
“Trump is a transactional person. He may target higher tariffs on certain items of Indian exports so he can negotiate for lower tariffs for US products in India,” he told AFP.
In the medium term, these negative effects could be counterbalanced by establishing factories outside China to escape the fallout.
The “China+1” strategy initiated during Donald Trump’s first term saw production shifts to India, Malaysia, Thailand and Vietnam.
With its geographical position and cheap skilled labor, Vietnam has already been one of the main beneficiaries.
The country has notably received investments from Taiwanese Apple subcontractors Foxconn and Pegatron and South Korea’s Samsung, becoming the second-largest exporter of smartphones in the world behind China.
“The likelihood increases that even more businesses will want to... have a second, or third, production base outside China,” said Bruno Jaspaert, chairman of the European Chamber of Commerce in Vietnam.
Chinese firms themselves are investing massively from Vietnam to Indonesia in sectors including solar, batteries, electric vehicles and minerals.
“American companies and investors are very interested in opportunities in Vietnam and this will continue under the incoming Trump Administration,” said Adam Sitkoff, executive director of the American Chamber of Commerce in Hanoi.
But whether it is low-end or high-tech production, China’s competitive advantage in terms of price, scale and quality is difficult to reproduce, warns Nomura bank.
A reorganization of production chains could lead to a “loss of efficiency” and increased prices, “with a negative impact on global growth,” Thomas Helbling, deputy director of the IMF for Asia, recently explained to AFP.
Asian countries could therefore gain export market share but ultimately see their situation deteriorate amid weakening global demand.
Asia, the world’s economic engine, prepares for Trump shock
https://arab.news/zuk5w
Asia, the world’s economic engine, prepares for Trump shock
- Trump vowed during campaign to slap 60 percent tariffs on Chinese goods entering US
- Move could impact Southeast Asia where production chains are closely linked to China
Trump says Elon Musk to head US ‘government efficiency’ department
- “Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures
WASHINGTON: US President-elect Donald Trump on Tuesday said Tesla and SpaceX CEO Elon Musk will lead a so-called Department of Government Efficiency alongside American entrepreneur Vivek Ramaswamy.
“Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies — Essential to the ‘Save America’ Movement,” Trump said in a statement.
Trump nominates Fox News host Pete Hegseth for defense secretary
WEST PALM BEACH, Florida: President-elect Donald Trump said Tuesday that he is nominating Fox News host and Army veteran Pete Hegseth to serve as his defense secretary.
Hegseth deployed to Iraq and Afghanistan and unsuccessfully ran for Senate in Minnesota in 2012 before joining Fox News.
“With Pete at the helm, America’s enemies are on notice — Our Military will be Great Again, and America will Never Back Down,” Trump said in a statement. “Nobody fights harder for the Troops, and Pete will be a courageous and patriotic champion of our ‘Peace through Strength’ policy.”
Senegal ex-president makes political comeback from afar
- He has accused Sall’s administration of leaving behind “catastrophic” public finances and manipulating financial figures given to international partners, which the previous leaders deny
DAKAR: Senegal’s former leader Macky Sall, who earlier this year sparked one of the worst crises in decades by delaying the presidential election, is seeking a controversial comeback in Sunday’s snap parliamentary elections.
Sall left office in April after 12 years in power, handing over the reins to his successor Bassirou Diomaye Faye and departing Senegal for Morocco.
The ex-president is now leading a newly formed opposition coalition from abroad, raising questions over the motives behind his return to the political fray and what it could mean for the West African country.
Sall’s longtime political foe, current Prime Minister Ousmane Sonko, has repeatedly suggested that members of the former administration, including Sall, could be brought before the courts.
He has accused Sall’s administration of leaving behind “catastrophic” public finances and manipulating financial figures given to international partners, which the previous leaders deny.
Political science professor Maurice Soudieck Dione sees Sall’s return as an attempt “to get a grip on the political game in order to protect his own interests” in the event of any “political recriminations.”
There is also a “personal dimension around him not having had his fill of power,” Dione suggested, pointing out that Sall had for a time toyed with the idea of running for a third presidential term.
Well respected on the international stage, Sall’s final years in power were marred by a political standoff with Sonko that led to dozens of deaths and hundreds of arrests.
His last-minute decision to postpone the presidential election in February then sparked one of Senegal’s worst crises in decades.
The thirst for change among a hard-pressed population saw Sall’s hand-picked successor, Amadou Ba, crushed at the ballot box by Sonko’s former deputy Faye.
Faye and Sonko had been released from prison just ten days before the vote.
Faye dissolved the opposition-dominated parliament in September, paving the way for legislative elections.
In returning to politics so soon, Sall has broken with the restraint normally adopted by former presidents in Senegal.
As the lead candidate for the Takku Wallu Senegal coalition, Sall justified his comeback in a five-page letter, citing the need to defend the “achievements” of his time in power.
He warned of the looming political and economic “dangers” faced by Senegal after months of “calamitous governance” by the new administration.
Presidential spokesman Ousseynou Ly decried Sall’s “indecency” on social media, blaming the former head of state for years of what he described as deadly unrest, debt and corruption.
As the election approaches, Sonko is traveling the length and breadth of Senegal promising economic transformation to excited crowds, while Sall addresses less rowdy audiences via speakerphone.
The former president can, officially, return to the country whenever he chooses.
“If he were to return to the country, we would ensure his safety because he is a citizen and former President of the Republic,” government spokesman Amadou Moustapha Ndieck Sarre told the Senegalese radio station RFM.
“But if he returns and the courts decide to arrest him, neither the prime minister nor the head of state can do anything about it,” he said.
Sonko has recently spoken of “high treason” in relation to what he termed the “catastrophic” state of public finances left by Sall’s administration.
High treason is the only case in which a president can be charged.
Legally, this would be “very complicated,” said El Hadji Mamadou Mbaye, a political science lecturer and researcher at the University of Saint-Louis.
Sall is returning to politics because “in reality he never wanted to leave power,” Mbaye said. “He feels indispensable.”
But “I don’t think the Senegalese are ready to forgive,” he added.
“If he had returned, the campaign would have been much more eventful, bordering on violent,” said political science professor Dionne.
“He had to carry out a very harsh crackdown on the opposition,” he added, referring to the years of turmoil.
“The wounds have not healed.”
Venezuela crackdown helped avert ‘civil war’: attorney general
CARACAS: Venezuela’s Attorney General Tarek William Saab defended the state’s crackdown on opposition supporters after disputed July elections, telling AFP the authorities’ actions helped avert a “civil war.”
The proclamation of authoritarian President Nicolas Maduro as the winner of the July 28 election triggered widespread protests.
The opposition, which had been tipped by polls for an easy win, had published detailed polling-station-level results which showed its candidate Edmundo Gonzalez Urrutia winning by a landslide.
Twenty-eight people, including two police officers, were killed and 200 injured in the unrest, during which around 2,400 people were arrested.
Saab claimed the violence that marred the protests had been “premeditated.”
“There was an attempt to trigger a civil war,” he said.
“The plan consisting in claiming there was fraud in order to generate a terrorist act. If we had not acted as we did at that moment Venezuela would have been gripped by civil war,” he told AFP in an interview Monday at his office in Caracas.
He denied the security forces had any responsibility for the deaths of demonstrators.
A September 4 report into the killings by Human Rights Watch (HRW) pointed the finger at Venezuelan security forces and pro-government militias known as “colectivos” in some of the deaths.
One of the victims was a 15-year-old boy, Isaias Jacob Fuenmayor Gonzalez, who sustained a gunshot to the neck while taking part in a protest in Maracaibo, Venezuela’s second-biggest city, according to HRW.
Saab, whose office walls are lined with portraits of Venezuelan independence hero Simon Bolivar, late Venezuelan socialist firebrand Hugo Chavez, his late Cuban ally Fidel Castro and Maduro, denied allegations his office was under Maduro’s thumb.
Appointed attorney general in 2017, he was re-elected to the position earlier this month by a parliament stacked with Maduro loyalists.
He cited among his achievements increased investment in community policing and 600 convictions handed down to police officers for human rights violations.
He also pointed to nearly 22,000 convictions for corruption under his watch and claimed to have dismantled “34 corruption systems” at graft-ridden state oil giant Petroleos de Venezuela.
Five of the last eight oil ministers are in prison or fled the country.
Saab claimed that during the post-election violence “around 500” buildings, including schools, clinics and town halls were damaged by protesters.
He denied that those detained were political prisoners, accusing them of “trying to burn” and “shooting at” demonstrators, without providing any evidence of his claim.
“A political prisoner is someone who has been detained because of his political ideas and who uses peaceful tactics... These people took weapons to (try to) overthrow a legitimately constituted government,” he accused.
The opposition says many of those arrested were arbitrarily arrested.
Venezuela’s Foro Penal rights NGO says some 1,800 people remain behind bars over two months later, including 69 teenagers.
Saab denied that children were being held, but said that the law allowed for the arrest of minors aged between 14 and 17.
He refused to be drawn on how many protesters were still in custody, saying only that “many have been freed.”
And he denied claims by the families of some of the prisoners that their loved ones had been tortured.
Only a handful of countries, including Russia, have recognized Maduro’s claim to have won a third six-year term.
But opposition protests have largely petered out since September, when Gonzalez Urrutia went into exile in Spain after a warrant was issued for his arrest.
Saab said the 75-year-old former diplomat would be “automatically detained” if he returned to Venezuela.
Saab also said that opposition leader Maria Corina Machado, who has been in hiding since the election, was under investigation but refused to say whether a warrant had been issued for her arrest.
US bans flights to Haiti as gang violence rages
PORT-AU-PRINCE: The United States on Tuesday banned all civilian flights to Haiti for a month, a day after a jetliner was shot at on approach to the capital and as a new prime minister took the reins of a nation ravaged by poverty and gang violence.
The US Federal Aviation Administration’s move came after a Spirit Airlines jetliner arriving from Florida in Port-au-Prince was hit by gunfire and had to reroute to the Dominican Republic.
Prime Minister Alix Didier Fils-Aime was sworn in on Monday, replacing outgoing premier Garry Conille, who was appointed in May but became embroiled in a power struggle with the country’s unelected transitional council.
On Tuesday, Haiti remained cut off from the rest of the world, with its main airport closed and bursts of gunfire ringing out in several neighborhoods of the capital.
Many stores and schools were shuttered as people feared more attacks by the powerful and well-armed gangs that control 80 percent of the city, even though a Kenyan-led international force has been deployed to help the outgunned Haitian police restore order.
Violent crime in the capital city remains high, with gang members routinely targeting civilians and robberies, rapes and kidnappings are rampant.
The attack on the Spirit Airlines aircraft saw one flight attendant suffer minor injuries. Images posted online appeared to show several bullet holes inside the plane.
The transitional council, aiming to put Haiti on a path to voting in 2026, had been tasked with stabilizing a country that has no president or parliament and last held elections in 2016.
The United States on Tuesday called on Haiti’s leaders to put personal interests aside and concentrate on getting the country back on its feet.
“The acute and immediate needs of the Haitian people mandate that the transitional government prioritize governance over the competing personal interests of political actors,” State Department spokesman Matthew Miller said in a statement.
Haiti has not had a president since the assassination of Jovenel Moise in 2021.
The Caribbean nation has long struggled with political instability, poverty, natural disasters and gang violence.
But conditions sharply worsened at the end of February when armed groups launched coordinated attacks in the capital, saying they wanted to overthrow then-prime minister Ariel Henry.
Despite the arrival of the Kenyan-led support mission in June, violence has continued to soar.
A recent United Nations report said more than 1,200 people were killed in Haiti from July through September, with persistent kidnappings and sexual violence against women and girls.
The report said the gangs were digging trenches, using drones and stockpiling weapons as they change tactics to confront the Kenyan-led police force.
Gang leaders have strengthened defenses for the zones they control and placed gas cylinders and Molotov cocktail bombs ready to use against police operations.
