Trump reaches trade pacts with Southeast Asian nations
The U.S. will exempt some products from tariffs in exchange for lower levies and purchases of U.S. goods across Malaysia, Cambodia, Thailand and Vietnam.
The Trump administration said it reached trade agreements with Malaysia and Cambodia, and frameworks for deals with Thailand and Vietnam during President Trump’s trip across Asia. The announcements, while not legally binding, represent significant progress in Trump’s quest to lower trade barriers for U.S. goods abroad.
Here’s what to know:
Malaysia and Cambodia
The U.S. entered into trade agreements with Malaysia and Cambodia that will see the Southeast Asian nations lower tariffs and regulations on U.S. goods such as vehicles and farm products. The administration said the two nations would buy more U.S. goods in exchange for certain exemptions from Trump’s so-called reciprocal tariffs, which will otherwise remain at 19%.
The U.S. won’t charge tariffs on many agricultural products and other goods not produced in the U.S. Many of those goods are laid out in an annex to Trump’s executive order on reciprocal trade that the administration had recently offered as carve-outs for nations that sign trade deals with the U.S.
The Southeast Asian nations agreed to cut tariffs on a variety of U.S. exports including agricultural products, metals and manufactured goods. They also agreed to accept many U.S. regulations and certifications on vehicles and farm products, the U.S. said.
The countries will also purchase new Boeing aircraft, and Malaysia will invest $70 billion in the U.S. over the next 10 years.
The Southeast Asian nations also agreed to facilitate U.S. access to critical minerals and not impose regulations or fines that target U.S. tech firms. They also agreed to prevent companies from other nations—such as China—from exporting to the U.S. at below-market prices. And they will also strengthen environmental and labor regulations, according to the deals.
The two deals represent some of the most detailed of Trump’s second term, but the administration hasn’t indicated it intends to send them to Congress for approval, as is typical for such agreements.
Thailand and Vietnam
The U.S. said it signed framework agreements with Thailand and Vietnam that could provide the foundation for fuller trade deals later on.
Both nations agreed to cut tariffs on nearly all U.S. goods, reduce regulations on American firms and accept many U.S. regulations on vehicles and other goods. They also agreed to purchase Boeing aircraft and U.S. agricultural goods, the U.S. said. And the Thai government signed a separate commitment to facilitate the development of critical mineral exports to the U.S.
In return, the U.S. agreed to identify goods it would exempt from its tariffs on the countries, which will otherwise remain at 20% for Vietnam and 19% for Cambodia.
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