Developing nations in south-east Asia, including wartorn and earthquake-hit Myanmar, and several African nations are among the trading partners facing the highest tariffs set by Donald Trump.
Upending decades of US trade policy and threatening to unleash a global trade war, the US president announced a raft of tariffs on Wednesday that he said were designed to stop the US economy from being “cheated”.
“This is one of the most important days, in my opinion, in American history,” said Trump on Wednesday. “It’s our declaration of economic independence.”
He hailed the moment as “liberation day”, but the tariffs are likely to be met with loud protests from some of the world’s weakest economies. One expert said Trump was likely to be targeting countries that received investment from China, regardless of the situation in that country. Chinese manufacturers have previously relocated to countries such as Vietnam and Cambodia not only due to lower operating costs, but also to avoid tariffs.
The tariffs come as many countries in south-east Asia are already grappling with the fallout from the cuts to USAID, which provides humanitarian assistance to a region vulnerable to natural disasters and support for pro-democracy activists battling repressive regimes.
Cambodia, a developing economy where 17.8% of the population live below the poverty line, according to the Asian Development Bank (ADB), is the worst-hit country in the region with a tariff rate of 49%. More than half of the country’s factories are reportedly Chinese-owned, with the countries exports dominated by garments and footwear.
Next worse-hit is the landlocked south-east Asian nation of Laos, a country heavily bombed by the US during the cold war, with 48%. According to the ADB, Laos has a poverty rate of 18.3%.
Not far behind is Vietnam with 46% and Myanmar, a nation reeling from a devastating earthquake on Friday, and years of civil war following a 2021 military coup, with 44%.
Indonesia, the biggest economy in south-east Asia, faces a 32% tariff rate, while Thailand, the second-largest, has been hit with a rate of 36%.
Major US rival and trading partner China has been hit with a 34% reciprocal tariff, on top of the 20% levy already imposed.
Dr Siwage Dharma Negara, a senior fellow at the ISEAS-Yusof Ishak Institute in Singapore, said the tariffs on south-east Asian nations were intended to hurt China.
“The administration thinks that by targeting these countries they can target Chinese investment in countries like Cambodia, Laos, Myanmar, Indonesia. By targeting their products maybe it will affect Chinese exports and the economy,” he said.
“The real target is China but the real impact on those countries will be quite significant because this investment creates jobs and export revenue.”
Tariffs on countries such as Indonesia, he said, would be counterproductive for the US, and the detail of how they would be applied remained unclear.
“Some garments and footwear [companies] are American brands like Nike, or Adidas, US companies that have factories in Indonesia. Will they face the same tariffs as well?” he said.
Stephen Olson, a former US trade negotiator, said countries in south-east Asia would be forced to reconsider their relationships with Washington. “A closer tilt towards China could be the result. It’s hard to have constructive, productive relations with a country that has just dropped a ton of bricks on your head,” said Olson, a visiting senior fellow at the ISEAS – Yusof Ishak Institute.
“The world’s largest importer has now essentially hung a sign on its border saying ‘closed for business’,” he added. “We are now faced with two plausible scenarios: Either the impacted trade partners hold firm and retaliate in the hope that Trump will be forced to back down, or they look to cut deals with Trump in order to avoid the tariffs. It is unlikely that either scenario will end well.”
Other nations among the hardest hit are several nations in Africa, including Lesotho – a country that Trump claimed “nobody has ever heard of” – with 50%, Madagascar with 47% and Botswana with 37%. Lesotho, a small mountainous kingdom surrounded by South Africa, has the second-highest level of HIV infection of the world, with almost one in four adults HIV-positive.
In south Asia, Sri Lanka is facing a 44% tariff. In Europe, Serbia faces a 37% rate.
In addition to the reciprocal tariffs on a few dozen countries, Trump will impose a 10% universal tariff on all imported goods. That tariff will go into effect on 5 April, while the reciprocal tariffs will begin on 9 April.
The US president has justified the changes by saying they are retribution for countries that have long “cheated” America, and the levies will bring jobs back to the US.
But economists have warned the sweeping changes will raise costs, threaten jobs, slow growth and isolate the US from a system of global trade it pioneered, and furthered over several decades.
“This is how you sabotage the world’s economic engine while claiming to supercharge it,” said Nigel Green, the CEO of global financial advisory deVere Group.
“The reality is stark: these tariffs will push prices higher on thousands of everyday goods – from phones to food – and that will fuel inflation at a time when it is already uncomfortably persistent.”
