Financial Insights That Matter
The finance chiefs of the Association of Southeast Asian Nations plus Japan, China and South Korea warned Sunday of the potential global economic fallout of protectionist trade policies, following the announcement of higher import tariffs by U.S. President Donald Trump.
“Escalating trade protectionism weighs on global trade, leading to economic fragmentation, affecting trade, investment and capital flows across the region,” the finance ministers and central bank governors said in a statement adopted when they met on the sidelines of the Asian Development Bank’s annual meeting in Milan, Italy.
The statement of the ASEAN-plus-three countries, which did not mention the United States by name, also reaffirmed their commitment to a rules-based, free, fair and “transparent multilateral trading system.”
Finance ministers and central bank governors of the Association of Southeast Asian Nations plus China, Japan, and South Korea hold a meeting in Milan on May 4, 2025. (Kyodo)
In addition to sector-based tariffs, including on automobiles, Trump announced “reciprocal” tariffs in early April, which are set to deal a heavy blow to many export-reliant Asian economies.
ASEAN members Cambodia and Vietnam are facing hefty U.S. levies of 49 percent and 46 percent, respectively, although Trump later announced a 90-day pause for most countries except China.
Trump imposed tariffs of 24 percent on imports from Japan, including a baseline levy of 10 percent that remains in place as negotiations continue.
Noting that the outlook is “subject to heightened uncertainties,” the finance chiefs called for “enhanced regional unity and cooperation.”
“We reaffirmed the significance of collaboration to achieve economic stability,” Japanese Finance Minister Katsunobu Kato told a news conference after the ASEAN-plus-three meeting.
During the gathering, the finance chiefs also agreed to update the Chiang Mai Initiative Multilateralization, launched in the aftermath of the 1997 Asian financial crisis to provide liquidity in times of emergency, widening its scope to cover pandemics and natural disasters.
Italy is a member of the Manila-based international lender, together with other European countries.
Related coverage:
Japan wants all tariffs reviewed to reach deal with U.S.: negotiator
Trump’s 25% auto part tariff takes effect, in latest blow to Japan
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