Southeast Asia’s response in a second Trump presidency: Exclusive insights from Moody’s Analytics
3 Mar 20256 min read
Summary
- Southeast Asia faces renewed uncertainty as Donald Trump begins his second term, raising the prospect of new tariffs and shifts in global trade alignments. According to Katrina Ell, Head of Asia-Pacific Economics at Moody’s Analytics, export-reliant economies such as Singapore, Vietnam, Thailand, and Malaysia are particularly exposed to the threat of tariffs, while weaker regional currencies and a strong U.S. dollar further complicate monetary policy decisions.
- Ell notes that Southeast Asia’s growing integration into global supply chains has made it indispensable yet vulnerable. The first Trump presidency and the pandemic accelerated diversification away from China, positioning the region as a key manufacturing base for intermediate goods. However, renewed protectionist policies and potential country-specific tariffs risk eroding these gains, especially in strategic sectors like technology and electronics.
- Despite these challenges, Southeast Asia retains key advantages including efficient infrastructure, integrated production networks, and established supply chain ecosystems. Ell emphasizes that the region’s ability to balance its economic ties between the U.S. and China while sustaining investment flows will define its resilience. As global trade fragments further, Southeast Asia’s adaptability will determine its long-term competitiveness in an era of shifting geopolitical realities.
Southeast Asia finds itself at a crossroads as Donald Trump secures a second term in the White House. In this exclusive feature, Value Chain Asia speaks with Katrina Ell, Head of Asia-Pacific Economics at Moody’s Analytics, to gain expert insights into how the region can navigate this shifting landscape. As a leading authority on macroeconomic analysis, Moody’s Analytics operates independently from Moody’s Ratings, and provides financial intelligence and analytical tools to understand a range of risks. With key exporters like Vietnam and Malaysia bracing for potential tariff hikes and economic stability hanging in the balance, how will Southeast Asia (SEA) adapt to this new geopolitical and economic reality with Trump in his second term?
SEA’s deep integration into global supply chains and its dual reliance on the United States and China make the region sensitive to disruptions. With its economies dependent on exports, policy shifts under Trump could have significant effects on the region, especially during Trump’s second term. According to Katrina Ell, the immediate challenge lies with tariffs.
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“The direct impact for southeast Asia is via the threat of tariffs that will hurt export performance. This will be particularly pronounced for those where exports are a large share of their economy including Singapore, Vietnam, Thailand and Malaysia.”
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