Trump inks raft of trade pacts with Thailand, Cambodia, Vietnam and Malaysia
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The news: US President Donald Trump announced a flurry of trade deals with Southeast Asian nations on Sunday, ahead of a meeting with Chinese President Xi Jinping scheduled for later this week.
The context: On the first day of Trump’s visit to Southeast Asia as part of the ASEAN Summit, which Prime Minister Anthony Albanese is also attending, the White House detailed a raft of trade pacts with the four nations which address critical minerals, reciprocal tariffs and shipping levies.
The agreements, which are not legal binding, are set to be enacted in the coming weeks.
“My message to the nations of Southeast Asia is that the United States is with you 100% and we intend to be a strong partner and friend for many generations to come,” Trump said at the ASEAN meeting in Kuala Lumpur on Sunday.
The agreement with Cambodia says that it will drop tariffs on US food, agricultural and industrial products, while the US listed hundreds of goods it plans to exempt from the 19% trade tariffs Trump had previously imposed.
The pact with Thailand eliminates tariffs on 99% of US goods across industrial, agricultural and food products. The US will list a set of Thai goods that it will exempt from its current 19% trade tariff. Thailand and the US also signed a memorandum of understanding (MoU) on critical minerals which would offer the US preferential access to rare earths. Thailand agreed to the procurement of 80 US aircraft at a total of USD18.8 billion ($28.85 billion) and the purchase of energy products, including LNG, crude oil, and ethane, with an estimated value of USD5.4 billion per year.
Trump also signed an MoU with Malaysia on critical minerals, as well as promising to list exemptions from the US’ 19% tariffs on Malaysian goods. The deal says Malaysia will procure 30 plus aircraft from the US and to fund investments in the US of USD70 billion.
The deal with Vietnam will see Vietnam “provide preferential market access for substantially all US industrial and agricultural exports to Vietnam,” while the US will offer zero tariffs on some selected products, which currently sit at 20%. Vietnam Airlines has agreed to purchase 50 aircraft from Boeing which is worth over USD8 billion, while Vietnamese companies have signed twenty memorandums of understanding with US companies to purchase US agricultural commodities, with a total estimated value of over USD2.9 billion.
The agreements do not address how the US will determine what it considers “transshipped” goods. Vietnamese transshipped goods are currently subject to a 40% tariff in the Vietnamese.
Earlier on Sunday, US Treasury Secretary Scott Bessent told reporters that the US and China had discussed agricultural purchases, TikTok, fentanyl, trade, rare earths and the overall bilateral relationship, describing the talks as “constructive, far-reaching and in-depth.”
