ASEAN Summits While Waiting for the Next Tariff Shoe to Drop

Southeast Asia's 29% export surge to the US masks a fragile dependency on electronics exemptions and Chinese trade rerouting. The region's leaders meet in Manila with no real leverage and no plan B.

Southeast Asian leaders are gathering in Manila for the annual ASEAN summit, but the real action is elsewhere — in the tariff decisions Donald Trump has yet to make and the trilateral Trump-Xi-Putin meeting scheduled for the APEC summit in Shenzhen. The summit runs Sunday through Tuesday, with Trump making a brief stop to meet Philippine President Ferdinand Marcos Jr before heading to China for his fourth face-to-face with Xi Jinping in just over a year.

The numbers look good on the surface. US imports from ASEAN rose more than 29 percent to $453.6 billion in 2025, expanding the bilateral trade deficit to $327.4 billion. But as Deborah Elms of the Hinrich Foundation warns, this surge is overwhelmingly driven by electronics shipments that are largely exempt from tariffs and tightly coupled to the AI infrastructure buildout. If either the tariff exemptions or the AI boom falter, the floor disappears. Trump's administration imposed tariffs of 10 to 12.5 percent on 60 trade partners in July, after the US Supreme Court struck down his steeper 'reciprocal' tariff regime in February. The Office of the US Trade Representative cited alleged failures to address forced labor. Additional trade probes targeting 'excess' manufacturing and national security concerns remain open — each one a loaded gun pointed at ASEAN exporters. The structural problem is that ASEAN's export boom is substantially a Chinese trade rerouting story. Billions of dollars in Chinese goods flow through Southeast Asian supply chains to reach the US under more favorable tariff treatment. Washington knows this. The ongoing trade probes are designed precisely to close these arbitrage windows. When they do, ASEAN's export miracle becomes ASEAN's exposure. Intraregional trade tells the other half of the story. Despite decades of liberalization rhetoric, intra-ASEAN trade sits at 23 percent of total trade — compared with 67 percent inside the EU. Phar Kim Beng of the International Islamic University of Malaysia is blunt: leaders will 'mouth the mantra of better and bigger' trade volumes without announcing anything concrete to achieve it. The most tangible expected outcome is the Digital Economy Framework Agreement, aimed at building an ASEAN digital economy worth $2 trillion by 2030 — a real step, but one that does nothing to address the tariff threat. Jayant Menon of the ISEAS-Yusof Ishak Institute flags the political context that makes this worse: Republicans suffered a crushing defeat in the November 3 midterm elections, losing both houses of Congress. But Trump retains significant autonomous authority over trade policy and may double down rather than moderate. ASEAN is betting on patience and quiet accommodation with a president who has shown no inclination to reward either. The summit will produce communiqués and handshakes. What it will not produce is a credible regional strategy for the moment when the electronics exemptions expire, the AI boom plateaus, or Washington decides Chinese trade rerouting through ASEAN is the next target. The region is riding a wave it did not create and cannot sustain.