Why Southeast Asia’s tariff hopes rest partly on Trump’s own party
KUALA LUMPUR — Tuesday’s US midterm elections could give Southeast Asian exporters a chance to secure exemptions from some of President Donald Trump’s tariffs. A sizeable Republican defeat could encourage members of his own party to join Democrats in pressing for relief, according to trade analyst Stephen Olson. He sees little prospect of a broader reversal before the 2028 presidential election.
Exporters have already seen how quickly Washington can replace one tariff with another. After the US Supreme Court struck down Trump’s use of emergency powers to impose tariffs in February, his administration turned to a different trade law. In July, it announced duties of 10% or 12.5% on goods from 60 economies, with exemptions for certain products. Washington said the economies concerned had failed to prevent imports made with forced labour. Vietnam, Malaysia and Thailand were among those affected.
The cost of the Iran war reaches Asian treasuries
For governments in the region, the cost of imported fuel is a more immediate concern. The Philippines, which relies on the Gulf for more than 90% of its crude oil imports, declared a national energy emergency in March after the war disrupted shipments through the Strait of Hormuz. Indonesia, Malaysia, Thailand and Vietnam have spent public money on subsidies to limit what households pay for fuel.
Steven Okun, who heads the Singapore consultancy APAC Advisors, told reporters that a Democratic majority would be more likely to investigate the conduct of the war than to bring it to an end. Congress can legislate to restrict military spending, but Trump could veto such a bill. Overriding him would require a two-thirds majority in both the House and the Senate.
Both parties see a case for tighter chip controls
Okun expects greater agreement in Congress over restricting China’s access to advanced US technology. One proposal, the Chip Security Act, would require companies to verify where advanced artificial intelligence chips end up. Another, the MATCH Act, would press US allies to adopt similar restrictions on the equipment used to manufacture chips. Both remain proposals, but they give Asian technology suppliers a reason to watch the next Congress regardless of which party wins on Tuesday.
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