Asia and “Reciprocal Tariffs” Is Regionalism the Antidote?

Asian countries are signatories to many trade agreements that have featured innovation, steady persistent cooperation, and large coalitions, all of which are factors that may be important in preserving the world trading system from the Trump administration’s tariffs. However, these agreements are not a unified system and are mostly shallow; thus, without extension they will not produce new trade flows to counter losses in U.S. markets. Although President Donald Trump’s trade policy is chaotic and destructive, his new trade restrictions are unlikely to disappear completely, even with international pressure and hostile equity and bond markets. No Asian country will be able to avoid economic stresses resulting from the reduction in world growth that these policies could cause. The most vulnerable will be the developing countries that have actively pursued export-led development with the U.S. as a primary partner. With uncertainty prevalent, a global response to Trump’s tariffs based on World Trade Organization (WTO) rules is desirable.

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