Leaders from the 10 countries of the Association of Southeast Asian Nations (ASEAN) will meet in Kuala Lumpur, Malaysia, next week for a two-day meeting focused on trade between ASEAN members, U.S. tariffs and wider trade uncertainty, the Myanmar civil war, and tensions in the South China Sea.
The disparate bloc — comprising Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, the Philippines, and Vietnam — has differing levels of exposure to U.S. tariffs. But all ASEAN members would be squeezed by any escalation in the simmering U.S.-China trade war.
ASEAN leaders typically meet twice a year. In April, Malaysian Prime Minister Anwar Ibrahim, whose country acts as ASEAN chair this year, said he wanted the bloc to forge a co-ordinated, collective response to U.S. tariffs. Thai Prime Minister Paetongtarn Shinawatra supported Anwar’s idea, but the plan seems to have splintered, with member states opting for bilateral — and so far, fruitless — negotiations with Washington.
Anwar spoke with Philippine President Ferdinand Marcos Jr. earlier this month, discussing “the Trump administration’s tariff policy and the ceasefire in Myanmar.” Marcos Jr. said he expected these discussions to continue at the leaders’ summit.
ASEAN looks inward
Much like recent initiatives by the European Union and Canada’s provinces and territories, ASEAN’s 10 members are looking to knock down internal trade barriers. Malaysia, as chair, is looking to harmonize regional laws on issues “pertaining to cross-border commercial disputes, insolvencies, and other business issues,” according to a Nikkei interview with Malaysia’s minister of law and institutional reform.
ASEAN members are also strengthening bilateral ties. Thailand's Paetongtarn recently visited her Vietnamese counterpart in Hanoi, where the two countries elevated bilateral ties to a comprehensive strategic partnership.
The upgrade signals a “shared determination by both countries to deepen and broaden cooperation across all dimensions... to jointly navigate global and regional challenges,” according to a Thai readout. Trade aside, tourism could be another piece of the puzzle: Manila recently pitched the creation of a unified ASEAN visa system, modelled after Europe’s Schengen Area.
According to the most recent data released by ASEAN, the bloc’s nominal GDP reached US$3.8 trillion in 2023 — a figure that has roughly doubled since 2010. In 2023, Indonesia accounted for the largest share of the bloc's GDP at 36.2 per cent.
Tariff-threatened countries seek stability
Leaders of other countries affected by U.S. tariff threats have flocked to ASEAN countries in recent months, a sign of the bloc’s enticing economic prospects and relative stability.
Chinese President Xi Jinping embarked on a ‘charm offensive’ in April, visiting Cambodia, Malaysia, and Vietnam. New Delhi will soon dispatch a parliamentary delegation to Indonesia, Malaysia, Singapore, South Korea, and Japan. And next week, French President Emmanuel Macron will visit Indonesia, Singapore, and Vietnam.
ASEAN member states collectively ranked as Canada’s fourth-largest merchandise trading partner in 2023. Natural resources, cleantech, agriculture and agri-food, financial services, and consumer goods dominate the trading relationship.
