ASEAN’s Future – Powered by Standard Chartered

According to a report by Standard Chartered’s economists Edward Lee and Jonathan Koh, the potential US-led tariffs on China and ASEAN could have different impacts on various economies. In the short-term, Vietnam, Thailand, and Malaysia (VN, TH, and MY) may benefit from the reallocation of exports due to US tariffs. The economists analyze three scenarios: a 60% tariff on all Chinese imports, a 10% tariff on each ASEAN economy, and a universal 10% tariff on all imports. Using trade in value-added (TiVA) data from the OECD, they estimate the impact of tariffs on ASEAN economies. They assume a demand elasticity of -1.3% for US imports, meaning a 1% hike in tariffs would lead to a 1.3% fall in imports. The report aims to provide an early indication of the potential growth impact of US-led tariffs on ASEAN economies, but notes that the actual impact could vary depending on various factors.