Economic ministers pledge stronger regional integration amid US tariffs

Economic ministers of the Association of Southeast Asian Nations concluded a four-day meeting in Kuala Lumpur on Sept 26 with pledges to deepen regional integration, expand trade partnerships, and uphold open and free trade in the face of rising global protectionism.

The 57th ASEAN Economic Ministers’ Meeting marked the first time the region’s top trade officials had gathered since the United States imposed punitive tariffs against trading partners, including ASEAN members, on Aug 7.

The export-reliant bloc, which counts the US as a key market, is expected to be significantly affected by the tariffs.

Since Aug 7, US imports from Indonesia, Malaysia, Cambodia, the Philippines, and Thailand have faced tariffs of 19 percent, while shipments from Vietnam are subject to a 20 percent duty. Brunei faces a 25 percent tariff, Laos and Myanmar face 40 percent, and Singapore faces 10 percent.

In a joint statement, the ministers said that regional growth, which expanded by 4.8 percent last year, is projected to slow to 4.2 percent this year, “reflecting the adverse impact and uncertainty arising from the global tariff landscape”.

Malaysian Minister of Investment, Trade, and Industry Zafrul Abdul Aziz, who chaired this year’s ASEAN Economic Ministers’ Meeting, said that the bloc will continue to support the rules-based multilateral trading system aligned with World Trade Organization principles.

Despite unilateral US moves, “we continue to support multilateralism and continue to diversify, strengthen our companies”, he said.

Awang Azman Awang Pawi, a professor at the Academy of Malay Studies at the University of Malaya, said the ministerial meeting was “extremely important”, calling it the bloc’s “first collective response” since the US tariffs took effect.

The ministers’ concern over unilateral trade measures amounts to a “direct critique of the global tariff environment”, he said.

Sharon Seah, a senior fellow at the ISEAS-Yusof Ishak Institute in Singapore, said the ministers’ statement implied “a renewed sense of urgency” among ASEAN members to counter global protectionism.

While countries will continue to engage the US on a bilateral rather than regional basis, Seah said ASEAN had reiterated its commitment to maintaining an open, multilateral, rules-based trading order.

During the meeting, the region’s trade chiefs held talks with dialogue partners, including China and India, and discussed accelerated upgrade of strategic free trade pacts.

They agreed to expedite discussions on launching the accession process for economies such as Hong Kong, Sri Lanka, and Chile, which are seeking to join the ASEAN-initiated Regional Comprehensive Economic Partnership — the world’s largest free trade agreement.

James Chin, a professor of Asian Studies at Australia’s University of Tasmania, said regional integration has always been central to ASEAN’s agenda. “That’s what the RCEP is all about anyway, to integrate them,” he said.

Josua Pardede, chief economist of Permata Bank in Jakarta, said the planned upgrade of the ASEAN Trade in Goods Agreement in October is the bloc’s “near-term shock absorber”, as it goes beyond tariff reductions to address nontariff barriers, enhance transparency, strengthen dispute resolution mechanisms, and improve supply chain connectivity.

Despite the challenges posed by US tariffs, Awang Azman highlighted ASEAN members’ engagement with the US, as shown by the meeting between economy ministers and US Trade Representative Jamieson Greer on Sept 24.

“While acknowledging strong trade and FDI ties with the US, the ASEAN side reiterated its focus on resilient supply chains and constructive engagement, signaling that ASEAN is not abandoning dialogue but instead diversifying partnerships and hedging risks,” he said.

Leonardus Jegho in Jakarta and Reuters contributed to this story.

Contact the writer at prime@chinadailyapac.com