Asean increasingly pulled in opposite directions

ALL eyes are on US trade talks, but for the Asean countries, visibility on progress remains poor. This partly reflects the US administration’s priority to strike deals with other larger economies including India, Japan, and China. For Asean, only preliminary talks have taken place and formal discussions are yet to happen. In the case of Thailand, it is yet to get a schedule for its first-round talks with high-level officials.

Big ask from the US

There are other fundamental factors at play. Where some preliminary talks have already occurred, it is unclear what the US wants exactly and officials have been trying to figure out the specific demands. Once they have a sense, a framework to pursue formal negotiations will be put together along with possible proposals.

The US has made it unequivocally clear to its trading partners to clamp down on transshipments from China aiming to circumvent US tariffs. This demand is most relevant for Asean countries, but compliance will also likely be challenging.