Asia Pacific News
LAST UPDATE: May 23, 2025
Trump Calls Japan’s Ishiba Ahead of Latest Tariff Talks in DC
On May 23, 2025, Japanese Prime Minister Shigeru Ishiba held a 45-minute phone conversation with US President Donald Trump ahead of the third round of tariff negotiations. Ishiba emphasized Japan’s preference for investment over tariffs, urging the US to remove recent trade tariffs, particularly the 25% tariff on automobile imports. Trump did not provide a definitive response regarding the tariffs.
Insight
Japan’s stance highlights its strategy to mitigate the impact of US tariffs through increased investment and job creation in the US. The lack of a clear response from Trump suggests ongoing challenges in reaching a consensus on tariff issues.
Japan core inflation tops forecasts as rice prices almost double
Japan’s core inflation rate surged by 3.5% in April 2025, marking the fastest year-on-year increase since January 2023. The spike is partly attributed to a 98.4% year-on-year increase in rice prices. This inflationary trend poses challenges for the Bank of Japan as it considers normalizing monetary policy amidst rising costs and economic pressures.
Insight
The significant rise in rice prices, a staple in the Japanese diet, underscores vulnerabilities in food supply and pricing. This situation may compel the Bank of Japan to reassess its monetary policies to address inflation without hampering economic recovery.
South Korea’s Presidential Race Tightens Sharply After TV Debate
The South Korean presidential race has become more competitive following a recent televised debate. Candidate Lee Jae-myung’s lead has narrowed, indicating a shift in voter sentiment as the election approaches.
Insight
The debate’s impact suggests that public opinion is highly responsive to candidates’ performances, highlighting the importance of media appearances in shaping electoral outcomes.
RBI Governor Sees India’s Growth Moderately Hit on Tariff Woes
India’s central bank governor stated that the country’s economic growth may be moderately affected by ongoing tariff issues. Despite this, domestic factors such as stable policies and strong corporate balance sheets are expected to support resilience.
Insight
India’s reliance on internal economic strengths may buffer against external trade challenges, but continued vigilance is necessary to mitigate potential impacts.
Vietnam expresses willingness to combat trade fraud in US tariff talks
During trade discussions with the US, Vietnam expressed its commitment to addressing trade fraud and reducing its trade surplus. The country seeks recognition as a market economy and removal from strategic export control lists.
Insight
Vietnam’s proactive stance in trade negotiations reflects its desire to strengthen economic ties with the US and integrate more fully into global trade systems.
Asia must not succumb to tariff retaliation, Singapore cbank official says
A senior official from Singapore’s central bank cautioned Asian economies against engaging in retaliatory tariffs, warning of potential supply shocks and inflationary pressures. Emphasis was placed on the importance of regional trade integration.
Insight
The advice underscores the need for Asian countries to maintain open trade policies and collaborate regionally to navigate global economic uncertainties.
Singapore Core Inflation Quickens for First Time Since Sept
Singapore’s core inflation rose to 0.7% year-on-year in April, the first increase since September. The Monetary Authority of Singapore adjusted its inflation forecasts amid global economic uncertainties.
Insight
The uptick in inflation, though modest, may influence future monetary policy decisions as Singapore balances growth with price stability.
Indonesia Picks New Tax, Customs Chiefs to Address Revenue Slump
Indonesia has appointed Bimo Wijayanto as the new Director General of Taxation and retired Lieutenant General Djaka Budhi Utama as the head of the Customs and Excise Directorate. These appointments are part of efforts to address declining state revenues.
Insight
The selection of a former military officer for a key financial role has raised concerns among human rights groups, highlighting the government’s focus on revenue collection amid economic challenges.
Philippines’ Marcos Keeps Economic Team Amid Cabinet Shakeup
President Ferdinand Marcos Jr. retained his economic team, including Finance Secretary Ralph Recto, while replacing Foreign Affairs Secretary Enrique Manalo with Undersecretary Theresa Lazaro. This move follows disappointing midterm election results and aims to stabilize the government’s economic direction.
Insight
By maintaining his economic team, Marcos signals a commitment to economic continuity, seeking to reassure both domestic and international stakeholders amid political shifts.
Philippine Central Bank Has Room to Further Ease Policy, Governor Says
Central Bank Governor Eli Remolona indicated that there’s room for further monetary easing, following a 25 basis point rate cut in December. Inflation remains within the 2%-4% target range, allowing for cautious policy adjustments.
Insight
The central bank’s stance suggests a balanced approach to supporting economic growth while keeping inflation in check, providing flexibility in monetary policy.
IMF Board To Review Sri Lanka In Coming Weeks
The IMF Executive Board is expected to review Sri Lanka’s economic reform program in the coming weeks. This review will assess the country’s progress in implementing fiscal and structural reforms aimed at stabilizing the economy. The outcome will determine the disbursement of further financial assistance under the IMF’s Extended Fund Facility.
Insight
The upcoming IMF review is crucial for Sri Lanka’s economic recovery, as it will influence the continuation of financial support and the country’s ability to meet its reform objectives.
New Zealand Targets Investment With Budget Tax Incentive
New Zealand’s government has introduced a tax incentive titled “Investment Boost,” costing NZ$6.6 billion ($3.9 billion) over four years through 2029. The incentive allows businesses to immediately deduct 20% of the cost of new assets from their taxable income, aiming to stimulate investment and economic growth.
Insight
This tax incentive reflects New Zealand’s strategy to encourage business investment amid economic challenges, potentially boosting productivity and long-term growth.
RBA Ready to Respond If Needed to Trade Shock, Hauser Says
Australia’s central bank is prepared to adjust monetary policy in response to potential global trade shocks, particularly those arising from the Trump administration’s tariff regime. Deputy Governor Andrew Hauser indicated that the Reserve Bank of Australia is monitoring the situation closely and stands ready to act if necessary to support the economy.
Insight
The RBA’s readiness to respond to trade shocks highlights the central bank’s proactive approach to maintaining economic stability amid international uncertainties.
Singapore DPM Says Holding Geopolitical Neutrality Not Possible
Singapore’s Deputy Prime Minister Gan Kim Yong stated that maintaining geopolitical neutrality is not feasible amid escalating US-China trade tensions. He emphasized that Singapore must navigate these challenges by taking positions that safeguard its national interests, acknowledging the complexities of the current global landscape.
Insight
This acknowledgment marks a strategic shift in Singapore’s foreign policy, indicating a more active stance in international affairs to protect its economic and security interests.
Thai baht movement in line with regional currencies, says central bank
The Bank of Thailand stated that the baht’s recent volatility is consistent with movements in regional currencies, influenced by external factors such as U.S. monetary policy and China’s economic recovery. The central bank has intervened when necessary to mitigate excessive fluctuations.
Insight
The baht’s alignment with regional currency trends suggests that Thailand’s monetary authorities are effectively managing external shocks, maintaining stability in the foreign exchange market.
