Asia Pacific News
LAST UPDATE: May 16, 2025
Japan's Economy Shrinks for the First Time in a Year
DJ
Japan's economy contracted in the first quarter of 2025, marking its first shrinkage in a year. The contraction is attributed to decreased exports and consumer spending, influenced by global economic uncertainties and domestic factors.
Insight
The economic contraction highlights Japan's vulnerability to external shocks and domestic challenges. It emphasizes the need for policy measures to stimulate growth, such as fiscal stimulus or monetary easing, to counteract the downturn and support economic stability.
Japan finmin to focus on forex consensus in dialogue with Bessent
Reuters
Japanese Finance Minister Katsunobu Kato plans to discuss foreign exchange matters with U.S. Treasury Secretary Scott Bessent during the upcoming G7 meetings in Canada. Both countries agree that excessive currency volatility is harmful to economic stability. Kato emphasized maintaining forex discussions within finance minister dialogues, separate from direct trade negotiations.
Insight
The planned discussions reflect Japan's proactive approach to address currency volatility concerns amid global economic uncertainties. By engaging in dialogue with the U.S., Japan aims to ensure coordinated efforts to maintain financial stability and prevent disruptive currency fluctuations.
Japan to hold out for better trade deal with US
FT
Japan is resisting pressure to accept a hasty trade deal with the U.S., aiming for the complete removal of the 25% tariffs on Japanese car imports imposed by the Trump administration. Prime Minister Shigeru Ishiba faces domestic political pressure ahead of upper house elections in July. Japan is negotiating through Economy Minister Ryosei Akazawa and Finance Minister Katsunobu Kato, offering concessions such as increased purchases of U.S. agricultural products and investment in U.S. energy projects, while unwilling to compromise its agriculture sector.
Insight
Japan's firm stance in trade negotiations underscores its strategic approach to protect key domestic industries while seeking favorable terms. The balancing act between economic interests and political considerations highlights the complexities of international trade diplomacy, especially amid shifting global alliances and economic policies.
South Korea minister asks for exemption from US tariffs at Greer meeting
Reuters
South Korea's Trade and Industry Minister Ahn Duk-geun stated that negotiations with the U.S. on tariffs aim to meet the July 8 deadline, but domestic political instability might cause delays. After the U.S. imposed 25% tariffs on South Korea in April, negotiations began, with technical consultations set for next week and another ministerial meeting expected in June. Ahn emphasized South Korea's hope for a tariff waiver and outlined a proposed trade package covering tariffs, economic security, investment cooperation, and currency policy.
Insight
South Korea's pursuit of a tariff exemption amid domestic political upheaval illustrates the challenges countries face in navigating international trade disputes. The proposed comprehensive trade package indicates a strategic effort to address not only tariff issues but also broader economic and security concerns, aiming for a holistic resolution.
EU Economy Chief Urges China Self-Restraint on Diverting Goods
Bloomberg
The European Union's economy chief has urged China to exercise self-restraint in diverting goods to the EU market as a means to circumvent US tariffs. The EU is concerned about a potential influx of Chinese products, which could disrupt the European market.
Insight
This appeal highlights the EU's apprehension about becoming a dumping ground for Chinese goods amid US-China trade tensions. It underscores the need for coordinated international trade policies to prevent market distortions.
U.S. tells Vietnam trade deficit 'unsustainable' and major concern during tariff talks
Reuters
During ongoing trade negotiations, the United States expressed serious concern over its trade deficit with Vietnam, labeling it as "unsustainable." In response, Vietnam has implemented tariff reductions on U.S.-bound goods and is cracking down on transshipped Chinese products.
Insight
The U.S.'s stance reflects its broader strategy to address trade imbalances. Vietnam's proactive measures indicate its commitment to maintaining favorable trade relations, but the situation underscores the complexities of global supply chains and trade dynamics.
Vietnam, Thailand Lift Relationship Amid Rising Economic Ties
Bloomberg
Vietnam and Thailand have elevated their diplomatic relations to a comprehensive strategic partnership, aiming to boost bilateral trade to $25 billion. This move reflects the strengthening economic ties between the two Southeast Asian nations.
Insight
The enhanced partnership signifies a strategic alignment in the region, potentially leading to increased economic cooperation and stability. It also positions both countries to better navigate global trade challenges collectively.
Thailand's trade proposal well received by United States, says ministry
Reuters
Thailand's comprehensive trade proposal, aimed at averting steep U.S. tariffs, has been positively received by the United States. The proposal includes commitments to crack down on transshipments and increase imports of U.S. goods.
Insight
Thailand's proactive approach demonstrates its intent to maintain strong trade relations with the U.S. By addressing concerns over trade circumvention and committing to import more U.S. products, Thailand seeks to mitigate potential economic impacts from tariffs.
Malaysia Central Bank Says It’s Ready to Act as Growth View Dims
Bloomberg
Malaysia's central bank has indicated its readiness to implement policy measures as economic growth projections dim. The bank acknowledges that growth may fall below official forecasts this year.
Insight
The central bank's stance reflects a cautious approach to potential economic headwinds. By signaling readiness to act, it aims to reassure markets and maintain economic stability amid global uncertainties.
Singapore says its growth forecast may need further adjustment amid uncertainty
Reuters
Singapore's Trade Minister Gan Kim Yong announced that the country's economic growth forecast might require further revision due to ongoing global uncertainties, including U.S. tariffs and trade tensions. The GDP growth forecast for 2025 was previously downgraded to 0%-2%.
Insight
Singapore's economy, heavily reliant on trade, is vulnerable to global market shifts. The imposition of U.S. tariffs and ongoing trade tensions could lead to a recession and job losses, highlighting the need for strategic economic planning and diversification.
