Washington [US], February 11: US President Donald Trump continues to make new moves on tariffs, raising concerns that the trade war will spread and have a significant impact on the economies of many Asian countries.
Reuters reported yesterday (February 10) that the stock prices of European and Asian steel producers have largely fallen due to the impact of US President Donald Trump 's tax policy on steel and aluminum.
Previously, on February 9 (US time), Mr. Trump announced that he would impose a 25% tax on all aluminum and steel imported from any country. This tax will be in addition to the existing tax on metal products.
During his first term (1997-2021), President Trump imposed a 25% tariff on imported steel and 10% on imported aluminum. But the US later exempted several major trading partners, including Canada, Mexico and Brazil. Under President Joe Biden, the tariff-free quota was expanded to include the UK, Japan and the European Union (EU).
It's not just China that's "hit"
Mr. Trump's new move comes as many EU members send messages of readiness to "retaliate". AFP quoted French President Emmanuel Macron as warning that US tariffs on Europe will increase inflation for the American people. Mr. Macron also declared his readiness to confront Mr. Trump in the trade war. Similarly, German Chancellor Olaf Scholz, in a televised debate with a political opponent on February 9, also showed an uncompromising attitude. When asked whether the EU was ready to respond if the US increased tariffs, Chancellor Scholz declared: "Yes... We as the EU can act within an hour."
On the same day, February 10, China's retaliatory tariffs against the US also took effect. Previously, in Mr. Trump's first "bullet" attack, China, along with Canada and Mexico, had their goods taxed by the US. Recently, Mr. Trump increased tariffs by 10% on many types of Chinese goods. In response, from February 10, China increased tariffs on some types of coal and liquefied natural gas, crude oil, agricultural machinery, etc. from the US. According to CNN, US goods with a total value of about 13.86 billion USD were "hit" by China's retaliation this time. China's response and messages from the EU have made observers worry that the trade war could soon spread.
Meanwhile, The Washington Post has an article commenting that President Trump's new decision on aluminum and steel tariffs has a significant impact on China. Specifically, although not in the top group of direct aluminum and steel exporters to the US, China has recently had a surplus of steel and aluminum and has transferred it to third countries to complete and sell to the US.
In addition, Mr. Trump's new move could directly impact many Asian economies , not just China. According to CNBC citing statistics, in Asia, South Korea, Taiwan and Vietnam are also major steel exporters to the US. Therefore, these economies are also directly affected by the new US tax policy.
On the other hand, China's steel output accounts for more than 50% of the world's total , but its real estate industry is still stagnant, causing heavy impacts on aluminum and steel consumption and surplus goods. Therefore, when facing difficulties in the trade war with the US, China tends to increase steel exports to other markets, including Southeast Asia. This is the indirect impact that many economies in the region face when the trade war escalates.
Big challenge
Responding to Thanh Nien about the impact of President Trump's tax policy, Ms. Sagarika Chandra, Director of National Credit Ratings of Fitch Ratings in the Asia-Pacific region , assessed: "The Asia- Pacific (APAC) economy faces obstacles from increased protectionism in the US in 2025. The US is an important export market for most APAC economies. Besides China, Vietnam, Taiwan, Thailand, Hong Kong, Singapore, Malaysia and South Korea are particularly vulnerable economies in this context."
"We expect slower growth for more than half of Asia-Pacific economies in 2025. However, some economies such as Australia, New Zealand and Japan will recover from their already weak 2024 performance. Despite this, overall growth in APAC will still be higher than other regions," Sagarika Chandra added.
Source: Thanh Nien Newspaper
