Trump tariffs to shake up Asian manufacturing in 2025

The year ahead presents significant challenges across the Asia-Pacific region. Amid ongoing structural weaknesses, China’s industrial and construction sector growth will continue to slow. The new US tariffs add an additional layer of drag on activity, as well as heightening economic uncertainties.

What you will learn:

• The US tariffs are most centrally targeted against China. High-tech industries such as electronics and semiconductor manufacturing will be hit the hardest. These sectors can easily migrate to nearby countries such as Japan, Korea, and Taiwan. Burgeoning high-tech exports within ASEAN will also see new opportunities for to replace China’s US exports.
• Japan will face targeted tariffs in the automotive and base metals sectors of 7.5% and 10% respectively. However, we see the overall tariff impact on Japan being relatively mild, with the country likely to pick up some of China’s lost output.
• India will be one of the least affected countries from rising tariffs, having one of the lowest dependencies on US markets in the APAC region. India will benefit from migration of production from China, but high energy costs will curtail Indian industrial potential.