Core Viewpoint - The article discusses the impact of recent tariff negotiations between the US and Vietnam, highlighting the changes in tariff rates and their implications for Asian economies, particularly in the context of global supply chain dynamics and economic recovery strategies. Group 1: Tariff Negotiations and Economic Impact - The US has announced a trade agreement with Vietnam, resulting in a 20% tariff rate, which is lower than the previous "reciprocal tariff" of 46% but significantly higher than the prior 4.6% [1] - Many Asian economies are export-oriented and their growth prospects heavily depend on global demand recovery and average tariff levels [2][4] - The trade structure in Asia has changed significantly, with increased integration and a growing trade surplus with the US, especially after the fiscal stimulus in the US boosted consumption [3] Group 2: Supply Chain Restructuring - The US is seeking "reliable allies" in supply chains, while China is diversifying its export channels, leading to a more complex supply chain structure in Asia [3][4] - Countries like Vietnam, Malaysia, Thailand, and South Korea are particularly sensitive to tariff increases due to their reliance on manufacturing and trade [4] - In contrast, India, Japan, and the Philippines may adapt more easily by shifting focus to domestic demand [4] Group 3: Economic Growth Strategies - The article emphasizes a shift in China's economic growth model from large-scale credit-driven growth to more targeted and gradual policies aimed at stabilizing the economy [8][10] - China's recovery is supported by improvements in productivity and a gradual revival of household consumption, particularly in durable goods and services [9] - Despite challenges in the real estate sector, there is optimism for improvement following government commitments to stabilize the market [9] Group 4: Future Outlook - The article suggests that Asian economies will need to adapt to increased volatility and may prioritize diversification strategies to enhance resilience against external uncertainties [6] - The expectation is that the focus will shift from maximizing efficiency in export-driven strategies to fostering domestic and regional demand [6] - The potential for further fiscal easing in China is noted, particularly if downward pressures on the economy intensify in the latter part of the year [10]