India on Tuesday challenged US tariffs on some copper products at the World Trade Organization, calling the high levies trade restrictions that impact the South Asian country’s exporters https://t.co/DXIunHN1ML ...

The Trump administration will work with state lawmakers to ban sales of U.S. farmland to buyers from China and other countries of concern https://t.co/EGcuJcihnA ...

中国在医疗器械公共采购方面对欧盟“对等反制”，部分产品排除欧盟企业参与中国财政部宣布，自7月6日起，在政府采购预算金额4500万元人民币以上的医疗器械时，确需采购进口产品的，在履行法定程序后，应当排除欧盟企业（不包括在华欧资企业）参与。中国商务部称，为了维护中国企业的合法权益，中方不得不采取对等限制措施。 ...

The US took fresh steps to restrict the trade of Iranian oil, keeping up pressure on Iran even as President Donald Trump signaled possible relief after bombing its nuclear facilities. https://t.co/O7VN01AKhI ...

CNBC’s Megan Cassella joins 'Money Movers' to discuss the U.S. preparing to revoke waivers to stop chipmakers from shipping American equipment to China. ...

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Viewpoints - Shifting business operations away from China is nearly impossible for other Asian economies due to China's central role as a market, supplier, and source of foreign direct investment [1][6][12] - Any trade restrictions imposed on China by other Asian economies would likely lead to retaliatory measures from China, severely impacting trade, capital flows, and growth prospects in the region [6][12][13] Summary by Sections Trade Restrictions and Challenges - The report analyzes which economies might be pressured to impose trade restrictions on China and concludes that most Asian economies outside of China would find it very difficult to implement such measures [3][6] - Economies like Vietnam, Thailand, and India, which have significant trade surpluses with the US and deficits with China, would struggle to impose tariffs on China due to their reliance on Chinese inputs [8][12] Economic Dependencies - China is a crucial source of final demand, inputs, and equipment for many Asian economies, particularly ASEAN countries, making it challenging for these economies to decouple from China [12][34] - Approximately 17% of exports from Asia (excluding China and Hong Kong) go to the US, while 16.6% go to China, highlighting the significant trade relationships within the region [12][26] Investment Flows - China accounts for 7.9% of foreign direct investment inflows into Asia (excluding China), with ASEAN economies being particularly reliant on Chinese investment [12][34] - The share of ASEAN in China's outward foreign direct investment has increased from 15% in 2018 to 20% in 2023, indicating growing economic ties [34][38] Supply Chain Implications - The report emphasizes that imposing tariffs on Chinese goods would disrupt the cross-border production networks in Asia, leading to inflation in consumer goods prices [12][30] - China holds a significant share in global exports of key products, such as mobile phones (37%) and computers (37%), meaning tariffs would likely lead to increased prices for these goods in other Asian economies [30][31] Conclusion - The report concludes that Asian economies are unlikely to impose trade and investment barriers against China, as it would severely disrupt their existing business models and economic growth [13][34]

Investment Rating - The report does not explicitly provide an investment rating for the industry or economies discussed Core Insights - Shifting away from China for Asia ex China (AXC) economies to avoid US tariffs is deemed nearly impossible due to China's integral role as a key market, critical supplier, and significant source of FDI inflows [1][5][13] - Implementing trade restrictions on China would likely lead to reciprocal measures from China, resulting in significant negative impacts on trade, capital expenditure, and growth outlook for AXC economies [5][8][13] Summary by Sections Trade Relations and Economic Impact - The US may seek to have AXC economies limit their economic involvement with China, but the report argues that such restrictions are impractical given China's central role in the region's production network [5][8] - China is a major source of end demand, critical inputs, and FDI, especially for ASEAN economies, making any trade restrictions potentially damaging [5][10][12] Economies at Risk - Economies like Vietnam, Thailand, and India, which have trade surpluses with the US and deficits with China, may be pressured to impose tariffs on China, but the report suggests they would struggle to do so [8][10] - Japan, Korea, and Taiwan, which also have significant trade surpluses with the US, run trade surpluses with China, making tariffs on Chinese imports unlikely [8][10] Trade Dynamics - Exports to the US account for 17.5% of AXC economies' total exports, while exports to China account for 16.6%, highlighting the importance of both markets [10][24] - China accounts for 41% of global value chain-related output in manufacturing, emphasizing its critical role in the region's supply chains [12][21] Potential Measures and Challenges - The report evaluates three potential measures the US could ask AXC economies to adopt: stricter rules of origin, tariffs on China, and limiting investment from China, all of which present significant challenges [15][16] - Imposing tariffs on Chinese imports could lead to inflationary pressures and disruptions in domestic manufacturing sectors, with potential retaliatory actions from China [18][31] Investment Flows - China's FDI inflows account for 11% of total FDI in ASEAN economies, with significant reliance on Chinese investments, particularly in Singapore, which acts as a conduit for FDI into ASEAN [37][39] - Other Asian economies like Japan, Korea, and Taiwan have lower reliance on Chinese FDI, which has been declining, thus limiting exposure to retaliatory measures [38][39] Transshipment and Domestic Production - The report notes limited evidence of transshipment activities in Vietnam, Thailand, and India, suggesting that their trade deficits with China reflect reliance on Chinese inputs for domestic production rather than trade rerouting [51][52]