With the evolving landscape of international relations, including priorities of the new US Administration, strengthening Asia-Europe cooperation would be pivotal to mitigating uncertainties over the global economy and enhancing economic resilience. Newly inaugurated US President Donald Trump ordered sweeping tariffs on goods from Mexico and Canada (25%), and additional tariffs on goods from China (10%) on 1 February 2025, eliciting vows of retaliatory tariffs. Experts expect the EU to also face US tariffs in the coming months. Countries in Southeast Asia are closely monitoring the situation. These measures are likely to affect global supply chains and create economic instability in regions that heavily depend on trade with the US, potentially leading to increased costs for consumers and businesses alike.
According to World Trade Organisation (WTO) Chief Economist Ralph Ossa, while this is already affecting investment decisions, it is not causing ‘deglobalisation.’ Trade between China and the US accounts for less than 3% of world trade. The key question is whether trade tensions between them would spread to other countries. More than 75% of world trade is still conducted directly on WTO terms, that is, under the WTO most favoured nation tariffs.
At the recent World Economic Forum (WEF) Annual Meeting in Davos, leaders emphasised, inter alia, the importance of multilateralism and the need for a robust partnership between Asia and Europe. During the discussions, ASEAN emerged as a conducive environment for investors with its large and youthful market, and rapid adoption of the digital economy. The EU reiterated its commitment to cooperation, and openness to those aiming to upgrade clean technology and enhance digital infrastructure. The Polish EU Council Presidency (January – June 2025) has pledged to foster deeper engagement between Asia and Europe by focusing on, among others, economic resilience. This portends well, for both sides to identify and seize opportunities to enhance cooperation in areas such as trade connectivity, investment in sustainable development, digital integration and financial cooperation, so as to remain open, competitive and resilient.
Sources:
Programme of the Polish Presidency of the Council of the European Union, January-June 2025
Commendable work by this organization in shedding light on economic resilience across Asia and Europe! Their information invaluable for communities. A true testament to the power of knowledge in building a resilient future!
Absolutely agree! The collaboration between ASEAN and the EU is a shining example of how knowledge and partnerships can drive economic resilience. From advancing sustainable connectivity under the Global Gateway initiative to fostering trade, green technologies, and digital transformation, their efforts are paving the way for a stronger, more inclusive future. It’s inspiring to see such impactful initiatives benefiting communities across both regions.