The Business Advisory Council (BAC) chairperson of the Association of Southeast Asian Nations (ASEAN) is allaying fears that the imposed tariff of the Trump administration on ASEAN members should not cause any panic. Instead, the regional bloc should take advantage of it and further collaborate in exchanging goods with one another.
According to a Reuters report, United States President Donald Trump said his administration is close to finalizing several trade agreements in the coming days and will notify other countries of higher tariff rates by 9 July, with the higher rates scheduled to take effect on 1 August.
But the Department of Trade and Industry has not confirmed if it has received a letter from the White House on whether or not the 17 percent tariff imposed on the Philippines will stay or has already been negotiated.
Work together
This year’s ASEAN BAC chairperson Tan Sri Nazir Razak of Malaysia said ASEAN member states should work together in order not to feel the brunt of Trump’s imposition of the sweeping tariffs.
“Although we don’t know what the outcome would be yet, as our leaders announced, our strategy will be: one, negotiate the best possible deal with the US; two, make sure that we are prepared to help the local businesses that will suffer the most; three, try and do more business within ASEAN, and four, look for more regions to do business with. Under Malaysian chairmanship, we’ve engaged extensively with other South countries, the GCC (Gulf Cooperation Council), and so on,” said Razak in an interview at the sidelines of the first-ever business retreat, dubbed “ASEAN-BAC Reimagined” on Monday night at the Manila Polo Club, Makati City.
“Hopefully, these will mitigate the expected drop in demand from the US,” he added, noting that they are not expecting that US President Trump would extend the pause on tariff imposition that ends today, 9 July.
“It’s a one-man decision, and it’s very difficult to expect what he’ll do and what he wants to do next,” Razak told the DAILY TRIBUNE.
More things ASEAN can do
So as not to be hurt by the tariff imposition, Razak said it is about time that the ASEAN members harmonize rules in terms of trade barriers, so that companies in the region could easily cross borders and trade.
“ASEAN members must understand that we still don’t trade enough with each other, and we can do a lot more. So now is the time. If we cannot turbocharge ASEAN integration when the external environment is so difficult, then we will never be,” he explained.
Moreover, Razak maintained that ASEAN economies are diversified and strong enough to weather such tariff imposition, as the ASEAN region continues to grow.
He said, in a separate speech during the event, that global political tensions have even made ASEAN a natural and attractive hub for investment, securing a record $230 billion in foreign direct investments in 2023, and demonstrating its resilience and attractiveness as a global investment hub.
