News / SE Asia trade agreements define tariffs – and a US-China deal deadline looms

© Muhammad Naseem Ansari

Shippers and forwarders have gained additional clarity over tariffs, after the US signed a set of trade agreements and frameworks with Vietnam, Malaysia, Thailand and Cambodia yesterday. 

And negotiations with China are also said to be progressing well, ahead of a 1 November deadline.

The US agreed to maintain tariffs at 20% for Vietnam, but with an eye to zero tariffs on some items; Thailand keeps its 19% tariffs, but has committed to cutting tariffs on 99% of US goods; while Malaysia and Cambodia signed full agreements that included revised reciprocal tariffs, with the ad valorem rate no higher than 19%. 

All four countries offered concessions: Vietnam has accepted US automotive, medical device and pharma standards; has reformed IP and agri rules; pledged the acquisition of 50 Boeing aircraft worth some $8bn, as well as US agricultural products worth $2.9bn; and will work jointly with the US on digital trade, export controls and duty evasion cooperation. 

Thailand has promised to scrap tariffs on 99% of goods; accept FDA certifications; committed to no digital services tax; and pledged $2.6bn of agricultural purchases a year; $5.4bn in energy a year; and 80 aircraft worth some $18.8bn. 

Malaysia and Cambodia have also agreed to accept US standards; a two-year deadline for a forced labour import ban; free data flows; full alignment with US export controls and sanctions. Malaysia has also promised to facilitate some $70bn in US-bound investment over 10 years, while Cambodia has opened its mining, energy and infrastructure to US investment 

All four countries have agreed to greater scrutiny of origin, digital documentation and cross-border data flows. 

But despite much detail in the agreements, there is more to come, with final announcements still to be made on zero-tariff goods and how origin rules will be applied. 

Meanwhile, negotiations with China also seem to be progressing in a bid to avoid 100% tariffs on 1 November. Media has reported that the pair have reached a framework agreement. 

According to Reuters, China will delay or pause export controls on certain critical minerals (especially rare earths) that are used in electronics, defence and electric vehicles, while it may allow access to other US goods, such as agricultural products including soybeans.  

But the race to avert 100% tariffs continues.