ASEAN's Vulnerability to Trade Disparities
China's reliance on Southeast Asian countries is a significant concern for its economic security in the Asia-Pacific region, particularly due to a long-standing trade imbalance with ASEAN economies. The 10-member bloc of ASEAN nations is caught in the middle of this issue.
The trade imbalance is exemplified by China's reliance on imports from ASEAN countries, particularly electronics and machinery. According to recent data, China imported over $100 billion worth of goods from ASEAN economies last year alone. In contrast, ASEAN nations have struggled to export their own products to China due to restrictive policies and a lack of market access.
ASEAN leaders are urging China to adopt a more open domestic economy strategy and shift away from state-sponsored exports to improve relations with their neighbors. This could help mitigate economic slowdowns and reduce dependence on friendly nations like the Philippines, which has historically been less willing to take sides in the rivalry between China and the US.
Commerce Minister Wang Wentao's recent virtual talks with his ASEAN counterparts aimed to address these concerns by finalizing an updated free-trade deal between China and ASEAN. The agreement is expected to shield some Southeast Asian countries from steep US tariffs, but its impact remains uncertain.