Asia braces itself as Trump's tariffs threaten export-oriented growth

Countries are taking steps to cut reliance on US, bolster their domestic economies

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HONG KONG — Asian leaders face tough decisions as US President Donald Trump's reciprocal tariffs pose a generational challenge to a region whose economies are built around exports to America and a world of low trade barriers.

Mr. Trump and his officials have long targeted China and already slapped a 20 percent levy on imports from the world's factory floor in a resumption of the trade war unleashed during his first presidency. This time round, he has also named Vietnam, South Korea, Japan and India as charging onerous tariffs or maintaining outsize trade surpluses — or both.

US Treasury Secretary Scott Bessent said in March that the reciprocal levies slated for April 2 will target the "dirty 15" that have substantial trade flows and barriers with the US.

While Mr. Bessent did not specify nations, there are exactly that many countries that make up more than three-quarters of the US trade deficit and nine are in Asia, according to a report from Bloomberg Economics. So it seems reciprocal levies — though cast globally — will hit the region's US$41 trillion (S$55 trillion) economy particularly hard.

Along with Mexico, Canada and the European Union, Asia has been squarely in the sights of Mr. Trump's protectionist push since his Jan. 20 return to the White House. His 25 percent tariff on steel imports will hurt Asian producers, which make up six of the 10 biggest shippers of the alloy to the US, and last week's imposition of a 25 percent tariff on auto imports will dent profits for carmakers including South Korea's Hyundai Motor and Japan's Toyota Motor.

The lack of exemptions for US allies, along with tough talk from Mr. Trump and his officials that signals a willingness to accept some near-term economic pain, has rattled markets across the globe. Mr. Trump said in an interview with NBC News on March 30 that he "couldn't care less" if foreign carmakers raise prices in response to last week's tariffs.