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The Diplomat
a day ago
- Business
- The Diplomat
Southeast Asia's Transshipment Dilemma in the China-US Trade War
The United States' tightening of export controls on advanced technologies, led by the Bureau of Industry and Security (BIS)'s Entity List and Foreign Direct Product Rule, aims to curb Chinese access to sensitive U.S. technologies. Yet these tools are increasingly circumvented through Southeast Asia, where Chinese firms exploit jurisdictional loopholes by routing goods through affiliates in open economies such as Singapore, Malaysia, Vietnam, and Cambodia. In addition, Chinese companies facing higher tariff rates have resorted to routing their goods through countries in Southeast Asia. These transshipments are a topic of increasing concern for Washington, as evidenced by their special mention in trade deals reached with Vietnam and Indonesia. While these evasion tactics challenge U.S. trade policy enforcement, they pose a deeper risk to Southeast Asia's long-term economic integrity, regulatory autonomy, and strategic positioning between the United States and China, the region's two largest trade partners. Southeast Asia's success relies on the continued openness of trade, but that very openness is now under stress as external regulations collide with free trade norms. Southeast Asian countries must now navigate the complex task of maintaining economic prosperity and neutrality, while preventing their jurisdictions from becoming conduits for regulatory evasion. Recent events highlight the extent of the challenge. Between April and July of this year, Vietnam intercepted over 2,000 shipments falsely labeled 'Made in Vietnam' but traced to Chinese factories. Vietnamese firms were also cited by BIS for transshipping AI-capable chips from U.S. suppliers to blacklisted Chinese entities. Malaysian tech hubs such as Penang and Johor have been flagged for similar rerouting practices. Meanwhile, in 2024, the U.S. Commerce Department ruled that solar modules assembled in Cambodia, Malaysia, Thailand, and Vietnam with Chinese inputs violated U.S. trade laws. Policy responses from impacted countries indicate the increasing recognition and concern of effects on regional economies. Singapore, for instance, has introduced stronger disclosure requirements, tightened enforcement against shell companies, and improved cooperation with multilateral initiatives like the Financial Action Task Force. Malaysia has escalated audits under its Strategic Trade Act and is investigating how shell firms enable transshipment schemes. While these moves are not a concession to U.S. pressure, they are a strategic response rooted in the understanding that weak oversight carries long-term risks to sovereignty and reputation. In response to these policies, Chinese leaders have strengthened diplomatic engagement with Southeast Asian countries to deepen economic ties to the region and position China as a champion of free trade. For Southeast Asian countries, the core issue is not just about complying with external demands but also involves building resilience and frameworks for regulation. If the region becomes a default route for the circumvention of global controls, it could erode trust with major trade partners, provoke unilateral countermeasures, and compromise the predictability that has made Southeast Asian economies attractive to investors. Moreover, such dynamics threaten to reduce the region's autonomy in shaping future trade and technology governance frameworks. At the same time, Southeast Asian states must carefully navigate their deep and complex economic ties with China. Many regional supply chains are integrated with Chinese production. Any moves perceived as aligned with U.S. restrictions risk provoking economic retaliation. Therefore, the challenge is not to choose sides but to assert a coherent trade strategy that can adapt to external pressure while maintaining credibility. This balancing act is especially critical as broader trends reshape Indo-Pacific trade dynamics. U.S. tariffs on Chinese goods, new industrial policies, and rapidly accelerating free trade agreements are altering what trade integration looks like. The question is not whether Southeast Asia should align more with U.S. or Chinese policy frameworks. It is whether the region can lead in building a trade architecture that upholds both openness and integrity. That means pushing for export control mechanisms that are not externally imposed but co-developed – ones that reflect Southeast Asian priorities in innovation, data governance, and strategic autonomy. As the Indo-Pacific enters an era that prioritizes technology and trade, countries like Singapore, Malaysia, Cambodia, and Vietnam are increasingly central to determining the new status quo. Strengthening regulatory clarity, improving cross-border coordination, and safeguarding the region's neutrality are investments in long-term regional strategy. By continuing to address these challenges on their own terms, Southeast Asian nations can help define a new model of trade resilience that resists being a pawn of great power competition and instead reflects the region's own values of openness and balanced diplomacy.
CNBC
2 days ago
- Business
- CNBC
Bessent to American businesses: 'Not the end of the world' if April 2 tariffs kick in
Treasury Secretary Scott Bessent tried to reassure American businesses Tuesday, ahead of President Donald Trump's Aug. 1 tariff deadline, downplaying the impact of any "snapback tariffs" and suggesting they could be short-lived. "What can you tell American businesses to expect on Friday?" CNBC's Eamon Javers asked Bessent in an exclusive interview in Stockholm, Sweden. "I would think that it's not the end of the world if these snapback tariffs are on for anywhere from a few days to a few weeks," Bessent replied, "As long as the countries are moving forward and trying to negotiate in good faith." For U.S. businesses that could be hit with more tariff hikes starting Friday, however, Bessent's suggestion that "it's not the end of the world" is unlikely to be all that reassuring. The threat of Trump's country-specific tariffs has hung over American businesses since he first unveiled them at his April "Liberation Day" event. And import-dependent U.S. companies are already struggling to keep up with the evolving timelines and proposed levies of Trump's rapidly expanding tariff policy. Experts warn that American consumers could soon see higher prices on some food items, including liqueurs and spirits, baked goods, coffee, fish and beer as a result of companies passing on the cost of the levies. Many American companies are trying to avoid raising prices by absorbing tariff costs themselves, without passing them on to consumers. But that is getting more and more difficult over time, as the Trump administration expands tariffs and the president shows little interest in lowering rates. More than 90% of U.S. importers are small businesses, according to data from the U.S. Commerce Department. With just days to go until the Aug. 1 trade deadline, Trump said Monday that he will likely announce a blanket tariff between 15% and 20% on products from the scores of countries that have not yet reached an individual trade deal with the administration. But until the president officially authorizes the new level, tariffs are poised to jump overnight to the levels he announced in April. Top Trump administration officials insist that the Aug. 1 deadline is not changing, even as dozens of countries' trade negotiations and tariff rates remain unresolved. The White House and the Treasury Department did not immediately respond to CNBC's request for comment on Bessent's remarks.
Cedar News
3 days ago
- Business
- Cedar News
Trump Blocks Taiwan President Lai's New York Stopover
The administration of former U.S. President Donald Trump has denied permission for Taiwan's Vice President Lai Ching-te to stop in New York during his planned transit to Central America. The move comes after China raised objections with Washington regarding the visit. Lai was scheduled to pass through the United States in August en route to Paraguay, Guatemala, and Belize—countries that officially recognize Taiwan. However, according to multiple sources familiar with the decision, the U.S. government informed Lai that he would not be allowed to visit New York during his trip. On Monday, Lai's office in Taipei announced that he currently has no plans for overseas travel, citing Taiwan's ongoing recovery from a recent typhoon and ongoing trade discussions with the U.S., particularly concerning tariffs. Insiders indicate that Lai's decision to cancel travel plans followed the notification that his New York stopover would not be permitted. This development has sparked concern among Taiwan's supporters in Washington, who fear that the Trump administration may be softening its stance on China amid efforts to organize a summit between Trump and Chinese President Xi Jinping. Recent reports from the Financial Times reveal that the U.S. Commerce Department was instructed to freeze plans for stringent export controls against China, highlighting the ongoing delicate trade negotiations between the two countries. Lai also intended to visit Dallas during his trip, but it remains unclear whether the denial of permission extends beyond New York to the entire U.S. transit. China has consistently opposed Taiwanese leaders visiting the U.S., which does not maintain official diplomatic relations with Taipei. Notably, the Biden administration permitted then-President Tsai Ing-wen to stop in New York in 2023 while traveling to Belize and Guatemala. Experts suggest that the Trump administration's decision reflects a desire to avoid aggravating Beijing during sensitive diplomatic talks. Bonnie Glaser, a China and Taiwan expert, noted that this action signals a willingness to negotiate aspects of U.S.-Taiwan relations, potentially weakening U.S. deterrence against China's ambitions regarding Taiwan. Meanwhile, Treasury Secretary Scott Bessent met with Chinese Vice Premier He Lifeng in Stockholm to continue trade negotiations amid this backdrop. Critics argue that yielding to Beijing's pressure is a strategic mistake that could embolden China to demand further concessions from the U.S. The White House has yet to comment on the decision, while the Taipei Economic and Cultural Representative Office in Washington referred inquiries back to Lai's office statement.
American Press
4 days ago
- Business
- American Press
Louisiana spotlight: Nungesser keeping state top of mind for those ready to explore
Traveling has been significantly increasing since the decline during the COVID-19 pandemic — and Lt. Gov. Billy Nungesser and his team are working hard to keep Louisiana top of mind for those ready to explore. Last year, Nungesser said his office used a U.S. Commerce Department grant to increase awareness of Louisiana as a travel destination in Mumbai and New Delhi, India; Madrid, Spain; and Milan, Italy. In a few months, the team will spend a week in Canada promoting the Bayou State and its French heritage. Canada 'is about 33 percent of our international market,' Nungesser told members of the Rotary Club of Lake Charles Wednesday afternoon. 'Those Canadians love them some Louisiana.' In Paris, the Louisiana Office of Tourism also wrapped taxi cabs serving as rolling billboards to inspire travel to the state and it sponsored the London Jazz Festival last year. Nungesser said Louisiana welcomed 43 million domestic and international visitors in 2023, the most recent data available. Those visitors spent a total of $18.1 billion, an increase of 5.4 percent over 2022. International visitation showed the most significant gain, he said, increasing 16.9 percent in 2023 with spending reaching $1.7 billion. Louisiana has also been on the national stage in recent months with an alligator-themed float that crawled the streets of Pasadena, Calif., for the 136th annual Rose Parade and again as host to the Super Bowl at the Superdome in New Orleans. 'Somebody asked me what do we do better than anyone else and I said Mardi Gras,' Nungesser said. 'So we found out what parades we could go to. We were in the Macy's Thanksgiving Day Parade for three years and now we're in the Rose Parade.' Though the floats are professionally designed, they are decorated by volunteers days before the parade. Every float is covered in flowers, leaves, seeds, bark and other natural materials to honor the Rose Parade's history. Nungesser said volunteers from Louisiana are flown to California and are shuttled between the warehouse where the float is being built to their accommodations. A New Orleans native who now resides in California brings her beignets-only food truck each day to feed the volunteers during their shifts and the best of Louisiana cuisine is served each night. 'It's a trip everybody should make,' he said. For more on volunteering, visit Nungesser said participation in the parade 'allows us to drive awareness about our state as a vacation destination to a broad number of attendees, as well as viewers watching from home,' Nungesser said. 'The return on investment for the Rose Parade has been incredible.' Nungesser said the Rose Parade media coverage — thanks to a plethora of morning show interviews aired across the nation as the float is being built — for the past four years reached an estimated 10.4 billion people and was worth $144.9 million. State Parks When Nungesser took office nearly a decade ago, seven state parks were under the threat of closure. 'I was told, 'You don't have the money to keep them open and they're in pretty bad shape,' ' he said. 'Thanks to our sheriffs and local volunteers we were able to do a lot of repair and get them presentable and today those seven parks are making a profit.' The Louisiana Office of State Parks operates 21 state parks, 14 historic sites and a preservation area that comprises 45,000 acres, 110 miles of roads and 1.2 million square feet of rental facilities that welcomed more than 1.75 million visitors last year. He said his new goal is creating resort conference centers within some of the state parks to attract visiting conferences. 'We have over 350 groups that meet every year all over Louisiana,' he said. 'They don't meet in New Orleans because the hotel does not cover their per diem, but they meet everywhere else. There's usually 300-500 people and it's a great opportunity for us and it would be a great for the local economies. One thing we won't do is we won't let anyone open a restaurant (within the conference centers) or anything that would compete with local businesses.' One state park thriving at the moment is Bogue Chitto — a top destination for travelers nationwide for its mountain biking trails, which are maintained by the North Shore Off-Road Bicycling Association. 'A thousand people a month from 10-15 states go to Washington Parish for this mountain bike trail,' he said. 'We also have horseback riding. We brought a gentleman's horses into the park and let him run the business out of the park and he's knocking it out of the park, no pun intended. These two private-public partnerships have put Washington Parish on the map. Before they had very little tourism. It has changed that town forever.' Prime Video just completed a documentary on the mountain bike trails and 25 percent of the proceeds will go into building additional trails. He said the park recently acquired an additional 600 acres to expand the mountain bike and horseback riding trails. Museums Nungesser's office oversees nine museums; the Secretary of State's office and some local cities operate the rest. He said he hopes to introduce a bill next year that would force all museums to be open on the weekends — every museum operated under the Secretary of State's Office are not — when people are off work and more likely to visit. His office has also bought the website and plans to video every museum in the state. 'We did a video about the ghost that's upstairs at the Beauregard Gothic Jail — I don't know if it's there but the lady has me convinced and I'm not going up to check — and we test marketed to people who like ghosts and at Halloween, 4,000 people showed up to find that ghost,' he said. 'If you have a ghost, we will promote it and they will come.' He said most are aware of the World War II Museum in New Orleans. Now promotions will tie in Chennault Aviation and Military Museum in Monroe, the Louisiana Military Museum in Abbeville and others to draw in like-minded visitors. He also wants to give all museums the freedom to hire the directors of their choice. Right now, that responsibility falls under the office that oversees the facility. Louisiana seafood Several key pieces of legislation passed during the 2024 Regular Legislative Session affected the seafood industry in the state. Act 47 mandates restaurants serving imported crawfish or shrimp must officially inform their customers on the menu; Act 148 requires restaurants and food service establishments to label on menus all imported seafood as such, not just shrimp and crawfish; and Act 756 transferred the Seafood Safety Task Force to the Louisiana Seafood Promotion & Marketing Board to help in the regulation of imported seafood. 'We want people to ask before they eat. The goal is to prevent imported seafood — which is filled with a lot of antibiotics — to come into this country and to level the playing field for our Louisiana fishermen,' he said. 'If you eat Boudreaux's crawfish tails, they're going to be from Boudreaux's. They're not going to be from Thailand.' Keep Louisiana Beautiful Love the Boot Week is Louisiana's largest litter removal and beautification effort. During 2024, 19,441 people volunteered a total of 100,712 hours at over 760 events, removing a record 347 tons of litter in all 64 parishes. 'It has become a movement,' Nungesser said. Their efforts diverted 293 pounds of aluminum cans and 330 pounds of plastic bottles from the landfill allowing the items to be recycled. Next month, the office will be handing out buckets at marinas around the state, asking boaters and fishermen to scoop up any trash they may see on the waterways and shorelines. 'We're not going to take our foot off the gas until we have no more trash in Louisiana,' Nungesser said.
Toronto Star
5 days ago
- Business
- Toronto Star
B.C.‘s independent wood manufacturers decry retroactive U.S. softwood duties
VANCOUVER - British Columbia's independent wood product makers say hundreds of small- and medium-sized manufacturers may be forced to shut down in light of the latest decision from the United States to raise anti-dumping duties on Canadian softwood. The province's Independent Wood Processors Association says in a release that the U.S. Commerce Department's decision this week to raise duties also includes a requirement for Canadian companies to retroactively remit duties for products shipped to the United States since Jan.1, 2023.
