Southeast Asia still under pressure amid US-China trade truce: analysts

During a whirlwind visit last month to Kuala Lumpur, US President Donald Trump oversaw a peace accord between Thailand and Cambodia and secured trade and critical minerals agreements with those two countries as well as with Malaysia and Vietnam.

At the same time, US and Chinese negotiators met in the Malaysian capital, addressing trade disputes to pave the way for Trump’s summit with Chinese leader Xi Jinping in Busan last week. The talks yielded progress on tariffs and rare earth exports.

For many countries around the world, the diplomatic detente between the world’s two economic giants might reduce the pressure they face to pick sides in the far-ranging rivalry.

Yet, as Southeast Asia enjoys a respite from the tensions, analysts warn that the region remains on the front lines of an entrenched geopolitical competition with no easy path forward.

Xu Weijun of the Institute of Public Policy at the South China University of Technology in Guangzhou said “smooth progress” in the China-US trade talks “could afford third countries more room to manoeuvre and sustain a hedging strategy”.

“But if the negotiations hit an impasse, it could escalate strategic tensions and bring back the intense pressure for nations to choose a side,” Xu said of the dialogue between Beijing and Washington.