What does Trump's comeback mean for East Asia? He's marked China as his primary adversary, threatening heavy tariffs on its imports. And in a geopolitically tense part of the world, will Trump keep up Washington's security commitments to its allies?
This is Inside Story. Hello and welcome to the program. I'm Elizabeth Puranam. The world's two biggest economies, the U.S. and China, are on a collision course.
Donald Trump has promised to impose high tariffs on Chinese imports once he's back in the White House, threatening to destabilize markets across Asia. It could perhaps also open new ones, but at what cost? Trump's America First policy is also raising security concerns.
Will the U.S. stand by its vow to defend Taiwan's sovereignty? And then there's North Korea. Kim is forging closer ties with Putin and testing bigger and more advanced missiles.
And the neighbors are getting nervous. So how will Trump's policies affect Asian markets? And will long held allies be left out in the cold?
We'll explore all these issues with our guests in a moment. But first, this report by Katia Lopez-Jodean. Imposing tariffs on Chinese... products as high as 60% is a threat Donald Trump repeated throughout his campaign. And I'm doing the same thing with China.
We're going to tariff the hell out of them. China was charged by me hundreds of billions of dollars. I'm going to put a 100, 200, 2000% tariff.
They're not going to sell one car into the United States because we're not going to destroy our country. The threat is forcing China along with other foreign countries and companies to look at options outside the U.S. But trade between the U.S. and China has surged in recent decades and is crucial for both. Economists warn high tariffs could backfire globally. I believe that Trump's threat of 60 percent tariffs.
will likely happen. As far as China's exports are concerned, by far the largest market is U.S. and Europe, and so they don't necessarily want to fight a two-front war. Beijing is bracing for what could be a new phase with Washington. Regarding Trump's proposed tariffs on China, we will not delve into a hypothetical.
But as a matter of principle, I would like to reiterate this. no one will win a trade war. In North Korea, the big question is whether Trump will try to resume diplomacy with leader Kim Jong-un.
Pyongyang has been building closer ties with Russian President Vladimir Putin, and it recently launched its most advanced intercontinental ballistic missile yet. For neighboring South Korea, support from the U.S. is crucial. I believe that the so-called trilateral cooperation between South Korea, the United States and Japan will proceed well during the following Trump presidency. Trump's foreign policy has often included mixed messages.
Now, much of Asia is trying to prepare, as best it can, for any scenario. Katia Lopez-Odoian, Al Jazeera for Insight Story. Well, let's bring in our guests. In Beijing, Ina Tangen is a senior fellow at the Taihe Institute.
In Washington, D.C., Philem Kine is a China correspondent for Politico. And in Singapore, Graham Ong Webb is an adjunct fellow at the S. Rajaratnam School of International Studies.
A very warm welcome to Inside Story. Ina, I'll start with you in Beijing. How is China preparing itself for four years of a Trump presidency?
Well, the preparations go back much further than that. They were ambivalent about who was going to be elected. Either one was to pass to the exact same cliff. So at this juncture, they have been pursuing this dual circulation strategy, which stresses internal consumption as a way of attracting foreign investment and growing their economy, not only in terms of trade and things like this, but also in terms of innovation.
They really see their opportunity to climb the ranks in terms of technology. Philem, China has unveiled new measures aimed at boosting its flagging economy, some of which Ina has mentioned. But how much do you think Trump's victory hinders Xi's plans to transform the country into this technology powerhouse? It's going to be a real handicap. You know, the Trump team has made clear, Donald Trump has made clear that tariffs against China are foundational to his brand, foundational to this MAGA movement.
And he's threatening tariffs of up to 60 percent on across the board on Chinese imports. So that's really going to to crimp, which is a real big part of China's economic engine. I think the big question is. to what extent has China had the last four years to prepare for this in terms of countermeasures?
And the first countermeasure, of course, is we're probably going to see a fair bit of tit for tat tariffs, reprisals from Beijing, but also the extent to which Beijing is going to be reaching out to U.S. allies and partners to see if they can split off these allies and partners in terms of trade sweeteners and better trade with those folks. to mitigate or to soften the blow of U.S. tariffs. And, Graham, certainly we've seen reports Chinese policymakers have been preparing for a Trump victory, at least for months.
They're trying to lessen the exposure to the U.S., increase trade with global South countries. Just in September, she announced China would introduce a regime of zero tariffs for developing countries that have diplomatic relations with Beijing. But how much can trade with other countries make up for the impact of a trade war?
Feel him saying a trade war is. very much in the making, make up for the impact of a trade war with the world's largest economy? Well, you know, the statement about zero restrictions is something I think that countries here in Southeast Asia, to which, you know, comprises 10% of the world's population, Southeast Asia matters, within the Asia-Pacific, are not really taking any chances, you know, because of the fact that, you know, over time... Over the last few years at least, we have seen an increasing footprint of Chinese companies, Chinese trade and Chinese investments coming into the region.
And I think we are bracing ourselves for the worst possible scenarios where the tariffs of 20% across the board, which we're paying attention to, may be only the baseline, where sooner or later countries that are doing a significant amount of investments with China are going to be in the process of the Trump administration and therefore Southeast Asian countries, economies here are finding ways to, you know, build their business, grow their models, etc., with, you know, lesser reliance perhaps on China on the one hand and the U.S. going forward. So looking more inwardly within Southeast Asia, perhaps the Asia-Pacific at large, excluding China. Aina, how concerning will that be for China that other countries across the region will be looking to diversify from Chinese investments so that they're not facing any...
secondary tariffs and although you've spoken about the measures that China has has taken to I suppose Trump proof its economy would the Chinese economy in the state that it's in can it afford another trade war well you're supposing that China is on the brink of a disaster I think if you came here you'd understand that that's just not the case There is significant pain that's been felt. China's handling of the real estate, for instance, they want to bring down housing prices so that you can't let the real estate industry go hog wild. So they're doing what is necessary to control their economy and put in place what they intend to do. Remember, the difference between China and most of the rest of the world is that China plans long term. These are not policies that cook up in an instant on the campaign trail.
These are things that are carefully vetted, sent up and down the chain. So I can assure you China is prepared for the pain that's coming. But they've been doing this for a long time.
They've diversified away. Their number one trade partner is not the U.S. or Europe. It is now ASEAN.
They understand that countries will go forward in their own best interest and try to get in between these giants. But remember, China is the manufacturer. is equal to the next five countries combined.
So, you know, you have to put that into perspective. Donald Trump is not going to be able to move industries and supply chains to the U.S. And his plan to use tariffs on one hand and to devalue the dollar are going to have significant consequences across the board, not only to the economy of the world. Remember, he's putting tariffs on everyone else as well.
but also to the financial system where the dollar is the preeminent trade transaction number. Phelan, Trump has close ties with the business community, including many Fortune 500 companies like Tesla. We've seen his growing relationship with Elon Musk. Also companies like Apple, which have long-term investments in China.
Do you think that this could prompt Trump to rethink his approach to China? You know, I think that's the trillion dollar question. You know, we saw the tech community, Silicon, Valley really flock to support Trump in this campaign.
Of course, Elon Musk being the standard bearer for that. So, you know, Trump needs to or will be needing, trying to balance this, his promises of inflicting economic pain on China to benefit the, supposedly benefit the U.S. consumer through tariffs and through restrictions on U.S. investment in China. with this very close kinship that he's developed with Elon Musk, who, as you mentioned, has, you know, massive investments in China through Tesla. We just don't know how this is going to play out. There's a real tension there.
And so I think this is clearly a big part of what the Trump transition team is discussing in terms of how they make that balance. But right now, we really just don't know. There are so many questions. Aren't there?
Graham, I want to, while still talking about trade, I want to also talk about security in the Asia region. Do we know, one of the big questions remains, do we know what Trump's policy on Taiwan will be? Because he has really been all over the place with Taiwan, hasn't he?
In his first term, he increased arms sales, arms transfers to Taiwan. He lifted restrictions on contacts between American and Taiwanese. officials, but then recently he said that he called into question the U.S. continued support for Taiwan, accusing it of stealing America's semiconductor industry.
He even suggested that Taiwan should pay for U.S. protection. And then last month, he said that if China was to impose a blockade on Taiwan, then he would increase tariffs on China to 150 to 200 percent. So given all the things he said about Taiwan. Do we have an idea of where he stands?
Well, I think once again, we'll have to see as we enter the first quarter of 2025, the first, the proverbial first 100 days of, you know, the 47th US presidency, to see how Trump really, what kind of walk Trump makes, you know, in contrast to the policy statements or the vision that Trump has actually enunciated over the course of his campaign. But I think that... Come down to it, the view from pundits and experts here within Southeast Asia at least is that Trump will not want to be in a position or to conceivably to be in a position of weakness.
So come down to it, I think we do expect the US to come to the side of Taiwan, whether it is China that initiates hostilities with Taiwan or whether Taiwan crosses the red line, all red lines that initiates said hostilities. And so therefore, The sentiment, business sentiment in the region right now is quite sombre because companies are worried about the impact of a potential conflict that goes out of control on supply chains and massive trade routes that we see crisscrossing across the Asia Pacific. So I think we are not taking any chances. Of course, you know, it's a high impact event.
Probability may be significantly lower because no one wants to see. this conflict manifests, not even the Chinese for that matter, or the Americans, but how escalatory pressures can spin out of control if both the sabre rattling is not kept in check and the protect measures that are enacted by each side. Let me bring Ina in because I can see that he's not disagreeing with some of what you're saying.
Even though Graham is saying, Ina, that no one wants the situation between China and Taiwan to escalate, including China. We are not sure where Donald Trump stands, but what about the Republican National Convention, which for the first time since 1980 did not mention Taiwan in its party platform? Okay, I think I'll do deference to my colleagues.
I think they're misreading the situation. Beijing is very happy to hear that Trump's reaction to anything is not military. It would be economic. That signals that the U.S. is not going to try to push the envelope and create a military situation. He's also made it very clear in the past that he expects any country that enjoys U.S. protection to pay for it.
So he's going to be putting a lot of pressure on Taiwan. And part of that pressure is going to be saying to them, if you want our protection, you're going to have to put chip factories in the United States. So I think it's very clear what Trump is going to do. And this is actually going to deescalate the situation there.
China has no interest in doing a forcible takeover of Taiwan. Taiwan is there. It's not going anywhere. The issue is, was the U.S. going to try to push it into some sort of proxy situation?
And obviously, Donald Trump is signaling that is not going to happen. OK, Philem, do you think that Taiwan should be bracing itself for the same kind of pressure to boost its spending on defense that Trump has? been demanding of NATO member countries, for example. Yeah, I would say, I think the short answer is, I think Taiwan does have a Trump problem here. And the language that we've heard that you mentioned in terms of Trump accusing Taiwan of stealing the semiconductor industry, of needing to pay for its defense, and even questioning whether it'd be feasible to defend Taiwan in the case of a cross-strait conflict, this is classic Trump sort of transactional positioning.
And when you speak to... you know, former Trump national security folks, they say, look, when Trump thinks about and talks about Taiwan and trade, he sees red. But when you explain to him and when he thinks about the geostrategic value, then he looks at it from a different lens.
So I think what we're seeing is this positioning where Trump is going to be basically saying to Taiwan, you guys need to buy more weapons. That's what it's going to come down to. You got to do more for us. And, you know, Taiwan already buys billions of dollars in U.S. weaponry.
And of course, the big problem is a lot is getting there on a much delayed schedule because the U.S. can't keep up with the demand. But I think that this is classic sort of transactional talk on behalf of Trump. And it doesn't suggest that there's going to be an abandonment of Taiwan, but Taiwan is going to have to pay. Okay. And Taiwan is the only country, is not the only country that Donald Trump has said in Asia should be paying for U.S. protection.
How worried? Graham, should South Korea be given the kinds of things that Donald Trump has said? He's called South Korea a money machine, said that they would have to pay $10 billion to host U.S. troops in the country.
Well, you know, I think across the board, partner countries to the U.S. and those particularly with defense treaties, standing defense treaties, are unduly, of course, are worried that they will have to foot a larger portion of the bill in order to, you know, pay to play. in that security arrangement. So I think what's happening is, what's going to happen is that if Trump does execute what he says he's going to do, which is to have partners step up and, you know, divvy up more of the share.
And I think either that will happen, or it could be a strain on the national economies of the countries in question, or you might see a veering towards a more independent security policy in the part of South Korea and presumably Japan. Particularly under the current administration as to whether that administration is going to last, it's another question. But the fact of the matter is that there is a higher likelihood that these countries may go their own way.
And some experts see that it's a good thing for the region. Some see that there are downsides as well. I know the dynamics on the Korean Peninsula are very different since the last time Donald Trump was president. We had the talks between Kim and Trump.
And without any deal and we've seen advancements in North Korea's nuclear and missile programs since then. And this year, Kim broke with decades of policy towards South Korea, classifying it as a permanent enemy. Do you think that Donald Trump wants to re-engage with Kim?
Well, he might want to re-engage, but I don't think Kim wants to re-engage with him. He felt he was embarrassed and humiliated by Trump. He's also somebody who's a strong man and he's not going to take that very easily. But I think there's a misreading here.
When he announced that South Korea is the enemy and he has no intention of reunifying with it, that's actually a push towards peace. Because that was one of the major impediments, this idea that North Korea was insisting that the Koreans would have to unite and it would have to be under them. By pushing that aside. In theory, the peace talks and border issues can be settled and then he can normalize his country and pass it on to his future children, which seems to be his desire, especially as he's been bringing his daughter to work on a fairly regular basis. So at this point, the real issue is he now feels he has an alternate to China with Russia.
He sent 10,000 troops to Ukraine. He's trying to signal that he is a player, that he cannot be ignored, and that at some point or other, the countries have to deal with him as he wants to create this new North Korean normalized country. Philem, do you agree with Ina that Trump might want to reengage with Kim, but that Kim doesn't want to reengage with the U.S.? It's true that Kim has had a growing relationship with Vladimir Putin in the last year, but that recognition from China and Russia cannot replace.
A broader international recognition relief from sanctions that North Korea suffers from. I think that what we really need to understand here is that the situation on the Korean Peninsula is fundamentally different from it was when Trump was in power from 2016 to 2020. The problems or the DPRK, the North Korea problem, is now inextricably linked to the problems in Ukraine. We've had the dispatch of thousands of North Korean troops to the Russian front against Ukraine. So, you know, Trump's national security team.
need to be puzzling over to what extent do they need to be factoring in a much more bellicose, much more aggressive, much more threatening North Korea, not just threatening the U.S.'s longtime ally and partner, South Korea, but threatening Europe's interests vis-a-vis Ukraine. So, and again, we don't know exactly how that's going to boil, how it's going to come out in terms of how Trump and his national security team are going to interpret this. and try to take action against it. But I think the thing is, is that this is Terra Nova.
This is very different from the last Trump administration in terms of the problems with the North Korean regime. And we've yet to see or have some sort of clear signal as to how they're going to handle this. But it's much messier and much more difficult and is no longer amenable to a possible personality to personality, strongman to strongman accord.
Those days seem to be over. Yeah, and the last time we saw that personality to personality, strongman to strongman accord, it didn't actually result in anything. I know I can see that you weren't agreeing with Phelan there.
Well, it might not amount to anything, but this is still the way that Donald Trump defers to see things. I mean, he's still the young teenager who was going over from New Jersey into Manhattan in a A limousine trying to join the in crowd there and he very much values this idea that he's on the same par with Putin and Xi and these people. He wants to be affected.
He wants to be recognized, especially now that he has a mandate from the American people. He expects it. And I think very much he's going to be pushing this personality politics at the same time as he's trying his best.
to get his way and make MAGA the state of affairs for the United States. And of course, so much depends on what the rest of the personalities in this cabinet are. Graham, as we wait to hear about the makeup of the cabinet, just how much of the U.S. policy towards its friends and foe in Asia depends on who fills those positions, do you think? Well, it may matter a fair bit, but I think come down to it, what most leaders in Southeast Asia are looking to is whether or not it's a Republican-dominated U.S. government or a Democratic-dominated U.S. government, et cetera, doesn't quite matter. What matters at the end of the day would be the degree to which the U.S. continues to maintain and to grow its engagement with Southeast Asia, to say the least, and the wider Asia Pacific.
So we are still looking for that shift or status quo, if you will. and at the working level to engage with various facets of the government, both horizontally and vertically, to have closer relationships. I mean, the Singapore government in particular, our prime minister just two days ago gave a press conference saying that, yeah, come what may, we will work with whoever is in power.
We'll work objectively, find common interests, and we'll try and negotiate towards that common ground. And we'll work at all levels of the US government. And we've done that over the last...
the last few decades or continue to do that going forward. So I think that's a very cool-headed, very rational approach to think. Yeah, it's certainly what we've heard from most world leaders, whatever their past relationship with Donald Trump has been. Philip, Asia contributes the largest share of global economic growth. Are we going to see a decline in this growth and an increase in insecurity, or are you more positive?
So I would say for it. you know, the U.S. trade partners writ large, the signals are all flashing red in terms of Trump, too. You know, we have had, you know, Trump threaten tariffs up to 200 percent on automobiles coming in from Mexico, on top of the 60 percent across the board tariffs on Chinese imports. You know, in September, Robert C. O'Brien, Trump's former national security adviser, said on day one of the Trump administration, there's going to be a trade war with Europe.
So we're going to see this fracturing, maybe, of this alliance system of friends and partners the Biden administration has worked so hard to build up based on trade. So I'd say, you know, all bets are off because, you know, Trump may very well, in those first days of his administration, launch kind of a shock and awe campaign that is all about trade that might disrupt these types of relationships in Asia and Europe and beyond. And Aina, analysts at the London School of Economics and Political Science predict that Trump's tariffs would lead to a 0.68% reduction in China's GDP.
What are your prospects for the Asian economy and any impact that all of these tensions have on security? Well, it's going to be relative, as my colleague pointed out. Donald Trump is declaring economic war on the world. And as a result, it is going to be paid for by the American consumers, who ironically elected him because they thought he would do something about the wild, the inflation that they've been experiencing.
I think there's going to be a very different economic policy about six months to a year out when the numbers start coming in and people start screaming in terms of the pain. In terms of going forward in China, yeah, it's going to hurt, but it's not going to be fatal. And that's the issue.
If you start looking at global growth, as I was saying, it's relative. If you look at ASEAN and China, they're growing very well. Developed countries aren't. Even the U.S., they say that it was going very well. That was the narrative coming out of the Biden White House.
But the fact is, 70 percent of Americans felt that they were living paycheck to paycheck and they voted in Donald Trump. because they had more faith in his ability to right the economy. So the U.S. is not doing all that well. And when it starts this war, as I said, it's going to have a rebound effect.
And we'll have to see what happens after that. Ina Tangen in Beijing there, Philem Kind in Washington, D.C., and in Singapore, Graham Ong Webb. It's been a fascinating discussion. Thank you to all three of you for your insights. We really appreciate it.
And thank you, too, for watching. You can see the program again anytime by visiting our website, aljazeera.com. And for further discussion, do go to our Facebook page.
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From me, Elizabeth Puranam, and the whole team here, bye for now.