US tariffs redraw Asian manufacturing in April

While India's manufacturing has edged up, China, Vietnam, Korea suffer

- Gireesh Chandra Prasad & Rhik Kundu

April's tariff thunderstorm cooled manufacturing in many of Asia's export engines except India's.

Manufacturing in every major Asian economy with a trade surplus with the US shrank during the month, as US president Donald Trump's 2 April reciprocal tariffs cast a cloud over global trade.

China's official Purchasing Managers' Index (PMI) fell to 49 in April from 50.5 in March, indicating a contraction. The decline, the fastest in 16 months, is largely attributed to the reciprocal tariffs announced by the US, which went up to 14.5% tariffs by 9 April.

A large part of this was subsequently rolled back this month following the 12 May US-China trade deal, leading to a tariff reduction of 115% by both countries on shipments from the other for 90 days.

Caixin China General Manufacturing PMI shared by S&P Global also reflected a similar trend with a reading of 50.4 in April, its lowest since January, compared to 51.2. A reading above 50 shows overall expansion compared to the previous month, and below that, a contraction.

Vietnam's manufacturing sector contracted sharply in April, with the PMI dropping to 45.6 in April from 50.5 in March. The steep decline reflects a significant reduction in new export orders and marks the lowest PMI since May 2023.