Asia Will Come Together
It is not yet possible to estimate the remaining customs duties. I assume it will be around 10-15%. Vietnam and Indonesia have accepted tariffs of about 20%.
The EU does not accept a tariff of this level. However, rapprochement in the areas of military technology, energy sources, and agricultural products will help ensure that relations between Europe and the U.S. do not deteriorate.
It is important for Europe that the euro does not become too strong against Asian currencies. However, this will be difficult to achieve given the US’s political will to weaken the USD. Asian currencies are traditionally more strongly linked to the USD than to the euro, so a devaluation of the USD also leads to a devaluation of Asian currencies.
We are definitely living in interesting times because Asia is not the same as it was 30 years ago. Its economies are far more solidly founded than they were in the 1990s, and they continue to show solid growth rates. This allows for real asset growth with relatively low inflation. This, in turn, contributes to greater self-confidence and self-assurance in Asia.
Intra-Asian trade is growing in importance, with China playing a particularly significant role. However, trade between other Asian countries is also increasing.
In my opinion, it’s clear that Malaysia and Indonesia are increasingly conducting business in local currencies. The shift towards trusting the respective currencies is well underway. It is foreseeable that this trend will continue because using the currency of a third country makes little sense if one’s own currency is acceptable.
As Pressure From China Grows, Asia Should Come Together
Over the past 15 years, China has built up enormous manufacturing expertise and has become a leader in the field. It is seeking to establish itself in more and more areas. This will present challenges for Japan and South Korea, as well as the other Asian countries.
The United States’ desire to become less dependent on the rest of the world will set a precedent when it becomes clear that others do it better and that dependencies can turn against you.
As we are experiencing in Europe, we are closer to each other than the United States or China will ever be to any European country. The same will happen in Asia. The need for cooperation to avoid being crushed by the giants (the USA and China) is evident today. This is visibly bringing Europe (including the UK and Switzerland) closer together, and it will also lead to more cooperation in Asia.
I also assume that Asian countries will increasingly seek cooperation with Latin America, Africa, Australia, and Europe because the rest of the world has more potential than the two giants, each of which accounts for 20% of global GDP.
