CNA Correspondent Why the world can’t quit the US despite the highest trade tariffs in decades
Aug 4, 2025
Deborah Elms, a trade expert at the Heinrich Foundation, and Leong Wai Kit, a speaker specializing in U.S.-ASEAN relations, dive into the complexities of global trade under U.S. tariffs. They explore why countries still engage with the U.S. despite high levies, drawing parallels to historical trade policies like the Smoot-Hawley Act. The conversation touches on the challenges faced by businesses amidst inflation and uncertainty, as well as strategies ASEAN countries are adopting for economic integration in this shifting trade landscape.
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Unique Global Capitulation
- Trump's tariffs caused a unique global capitulation not seen since the 1930s Smoot-Hawley Act disaster.
- Countries largely accepted the tariffs fearing loss of access to the US market.
US-ASEAN Interconnection
- The US and ASEAN are deeply interconnected across security, politics, and economics, making decoupling counterproductive.
- ASEAN prefers to sustain ties with the US rather than risk a bitter trade 'divorce'.
Tariffs Likely Fixed
- Business leaders dislike tariffs but recognize the necessity to keep US market access.
- White House officials signal tariff levels are largely set, with limited room for negotiation.
