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ASEAN should exploit trade war opportunities: Envoy
ASEAN must be able to convince multinational companies to relocate operations to the region in order to achieve “positive impacts” from the trade rift between the United States and China, Phasporn Sangasubana, Thailand’s permanent representative to ASEAN and current chair of the regional bloc, has said
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span>ASEAN must be able to convince multinational companies to relocate operations to the region in order to achieve “positive impacts” from the trade rift between the United States and China, Phasporn Sangasubana, Thailand’s permanent representative to ASEAN and current chair of the regional bloc, has said.
Phasporn said that all 10 ASEAN member states should focus on regional economic integration through the ASEAN Economic Community — a vision to develop a single market and production base, as well as a competitive region that is fully integrated into the global economy — amid escalating tensions between the world’s major economies.
And with the vision, which was adopted in 2015 and is expected to be fully implemented by 2025, ASEAN members should be able to turn such threats to the global economy into an opportunity for the region, by persuading multinational companies to shift production to ASEAN, Phasporn said.
“ASEAN must ensure that the trade rift between the US and China has long-lasting positive impacts on the region by attracting multinational firms to relocate their operations from China to ASEAN. This measure will also benefit China in the long term as China is ASEAN’s largest trading partner,” she told The Jakarta Post in an email interview on Wednesday.
According to data by the Chinese Mission to ASEAN, two-way trade between China and ASEAN grew by 14.1 percent to US$587.87 billion in 2018 compared to 2017, reaffirming Beijing’s position as ASEAN’s top trading partner for 10 consecutive years.
Yet, Phasporn said that each ASEAN country “feels the pain” from the US-China trade war, which has been escalating rapidly for the past year.
Since 2017, Washington and Beijing have been engaged in a trade battle triggered by complaints from US President Donald Trump about China’s trading practices.
The tension peaked last month when Washington angered Beijing for putting telecom giant Huawei among blacklisted Chinese companies with which US companies are banned from doing business.
The trade war, which has caused a global economic slowdown, alarmed global stakeholders even more after Trump recently threatened to impose more tariffs worth $300 billion if he and Chinese President Xi Jinping did not come to any agreement at the upcoming G20 leaders gathering in Osaka in Japan. Beijing has yet to confirm whether Xi will meet Trump or not.
Chinese Foreign Ministry spokesman Geng Shuang has said that it would “fight to the end” if Washington insisted on escalating the trade tension, Reuters recently reported.
Phasporn said he believed the situation might favor firms in ASEAN whose products are in competition with China’s as it allowed the ASEAN companies to export more to the US following increased tariffs on Chinese products.
However, she said that such an advantage would only last for a short while because “the trade differences will have an adverse impact on all economies in the wider scale”.
Chinese Ambassador to ASEAN Huang Xilian earlier said that what he described as an unwanted trade war with the US would not hinder Beijing’s trade with the bloc.
China, he said, would continue to strengthen and increase trade, investment and cooperation with ASEAN, including by pushing forward its cooperation under China’s multitrillion dollar Belt and Road Initiative (BRI).
“Of course ASEAN being one of the most important trading partners,” he told the Post recently. “We will be implementing the upgraded protocol of the Free Trade Agreement between China and ASEAN, which we believe will bring more momentum to our trade and investment in the future.”
