
Rubio to make first Asia trip as Trump unveils tariffs on host and allies
The State Department billed the July 8–12 trip as a move to reaffirm Washington's commitment to the Indo-Pacific. Hours later, Trump said he would impose 25 per cent tariffs from August 1 on imports from Japan and South Korea, the key US regional allies and vital partners in countering China's growing might.
Trump also announced plans for tariffs on Malaysia and five other countries in the 10-member Association of Southeast Asian Nations, whose ministers Rubio will join for meetings in the Malaysian capital Kuala Lumpur.
Malaysia faces a 25 per cent tariff, Laos and Myanmar 40 per cent, Cambodia and US ally Thailand 36 per cent, and Indonesia 32 per cent.
Rubio will seek to firm up US relationships with partners and allies unnerved by Trump's global tariff strategy. Trump's announcements seemed certain to make that task harder.
The trip has been seen as part of a renewed US focus on the Indo-Pacific and an effort to look beyond conflicts in the Middle East and Europe that have consumed much of the Trump administration's attention.
"Top topics that he's going to want to hit, obviously, are to reaffirm our commitment to East Asia, to Asean, to the Indo-Pacific, and not just ... for its own sake," a senior State Department official told reporters.
"I think a key message that the secretary likes to deliver is that we're committed, and we prioritise it because it is in America's interests, right? It promotes American prosperity and it promotes American security."
The official said Rubio would be prepared to discuss trade, including reiterating that the need to rebalance US trade relationships is significant and echoing messages from the White House and the US Trade Representative.
Asean countries have been nervous about Trump's tariffs and questioned the willingness of his "America First" administration to fully engage diplomatically and economically with the region.
"There is a hunger to be reassured that the US actually views the Indo-Pacific as the primary theatre of US interests, key to US national security," said Greg Poling, director of the Southeast Asia Programme at Washington's Centre for Strategic and International Studies.
On Sunday, Trump said the US was close to finalising several trade pacts and would notify other countries by July 9 of higher tariff rates.
He also sent a message to BRICS group of developing nations as its leaders met in Brazil, threatening an additional 10 per cent tariff on any that align themselves with "anti-American" policies.
The BRICS countries include Indonesia, as well as China and India.
Last week, Trump announced he had reached a trade agreement with important Southeast Asian partner and Asean member Vietnam and could reach one with India. But he cast doubt on a possible deal with Japan, which is not only Washington's main Asian ally, but a major investor in the US.
Rubio has yet to visit Japan, or South Korea, the other main US ally in Northeast Asia, since taking office in January, even though Washington sees the Indo-Pacific as its main strategic priority given the perceived threat from China.
South Korea's presidential security adviser Wi Sung-lac headed to Washington on Sunday for trade and defence talks, with Seoul seeking to head off US tariffs.
He aims to meet with Rubio and discuss a possible summit between Trump and President Lee Jae Myung, who took office last month.
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The Star
24 minutes ago
- The Star
Analysis-For Europe, 30% US tariff would hammer trade, force export model rethink
BRUSSELS (Reuters) -The 30% tariff on European goods threatened by U.S. President Donald Trump would, if implemented, be a game-changer for Europe, wiping out whole chunks of transatlantic commerce and forcing a rethink of its export-led economic model. European ministers meeting in Brussels on Monday remained convinced they can bring Trump back from the brink before his Aug. 1 deadline and reach a deal that would keep the $1.7 trillion two-way trading relationship broadly intact. But the wild swings in Trump's mood towards the European Union - which he has sometimes labelled as friendly and at other times accused of being set up specifically to destroy the United States - keep the 30% threat very much alive for now. "It will be almost impossible to continue the trading as we are used to in a transatlantic relationship," EU trade chief Maros Sefcovic said of the 30% rate before meeting ministers and officials of the 27 EU capitals to give them an update. "Practically it prohibits the trade." EU officials had been hoping they could limit the damage by agreeing a baseline tariff around 10% - the one currently in place - with additional carve-outs for key sectors like autos. Last year the United States accounted for a fifth of all EU exports - its largest partner. Trump's bugbear is the $235 billion U.S. deficit generated by the goods component of that trade, even though the U.S. earns a surplus on services. UPEND POLICY PLANS The impact of making European exports - from pharmaceuticals to autos, machinery or wine - too expensive to be viable for American consumers would be instantly tangible. Economists at Barclays estimate an average tariff rate on EU goods of 35% including both reciprocal and sectoral duties combined with a 10% retaliation from Brussels would shave 0.7 percentage points off euro zone output. This would eat up most of the euro zone's already meagre growth and likely lead the European Central Bank to cut its 2% deposit rate further. "Inflation would likely undershoot the 2% target more deeply, and for longer, prompting a more accommodative monetary policy stance – with the deposit rate potentially reaching 1% by (March 2026)," the Barclays economists said. An earlier estimate by German economic institute IW found tariffs of 20% to 50% would cost Germany's 4.3 trillion euro economy more than 200 billion euros between now and 2028. While arguably small in percentage terms, that lost activity could still upend Chancellor Friedrich Merz's plans to push through tax cuts and spend more on renewing the country's long neglected infrastructure. "We would have to postpone large parts of our economic policy efforts because it would interfere with everything and hit the German export industry to the core," Merz said at the weekend of a 30% rate. NOWHERE TO RUN Further down the line, it raises bigger questions over how Europe recoups the lost activity to generate the tax revenues and jobs needed to fund ambitions ranging from caring for ageing populations to military rearmament. Under its existing policy of trade diversification, the EU has done well in striking preliminary deals with new partners but - as the continued delay over completion of the giant EU-Mercosur trade pact shows - it has struggled to get them fully signed and sealed. "The EU does not have different markets to pull up to and sell into," Varg Folkman, policy analyst at the European Policy Centre think tank said of the long and complex timelines involved in classic free trade deals. Some observers have argued the stand-off with Trump is what the EU needs to complete long-delayed reforms of its single market, boosting domestic demand and rebalancing its economy away from the exports which account for around half of output. The International Monetary Fund has estimated the EU's own internal barriers to the free flow of activity are the equivalent of tariffs of 44% for goods and 110% for services. Mooted reforms such as creating freer cross-border capital markets have made little headway in more than a decade. "It is easier said than done. There isn't an agreement to deepen. The barriers are imposed by the EU members themselves to benefit their own," Folkman said of the web of national regulations. How all this plays into the EU's negotiating strategy in the less than three weeks ahead remains to be seen - but for now, the bloc has stuck to its line of being open to talks while readying retaliatory measures if they break down. One thing that might persuade Trump to reach a deal, some European observers suggest, is that the lingering uncertainty may by itself push back the timing of the Federal Reserve interest rate cut the U.S. president so desires. "The latest developments on the trade war suggest that it will take more time to get a sense of the 'landing zone' on of course raises uncertainty for everyone, including the Fed," AXA chief economist Gilles Moec said. "With this new for cutting quickly get even harder to justify." (Additional reporting by Christoph Steitz in Berlin; Writing by Mark John; Editing by Hugh Lawson)


New Straits Times
28 minutes ago
- New Straits Times
Bessent no-show, BRICS tensions set to cast shadow over Durban G20 meeting
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Malaysia Sun
33 minutes ago
- Malaysia Sun
Trump vows to impose 100 per cent
Washington, DC [US], July 15 (ANI): US President Donald Trump has threatened to impose 100 per cent 'secondary tariffs' on Russia if a deal on Ukraine is not reached within 50 days. During his meeting with NATO Secretary General Mark Rutte in the White House on Monday (local time), Trump expressed disappointment with his Russian counterpart, Vladimir Putin and threatened to impose severe tariffs if there is no deal within 50 days. He said, 'We are very unhappy, I am with Russia. But, we will discuss that maybe a different day. But, we're very, very unhappy with them, and we're going to be doing very severe tariffs if we don't have a deal in 50 days. Tariffs at about 100 per cent. You'd call them secondary tariffs. You know what that means. But today, we're going to talk about something else. And as you know, we've spent USD 350 billion, approximately, on this war with Russia and Ukraine and would like to see it end. It wasn't my war. It was Biden's war. It's not my war.' 'I'm trying to get you out of it. And we want to see it end and I'm disappointed in President Putin because I thought we would have had a deal two months ago, but it doesn't seem to get there. So, based on that, we're going to be doing secondary tariffs if we don't have a deal in 50 days. It's very simple and they'll be at 100 per cent and that's the way it is. It can be more simple. It's just the way it is. I hope we don't have to do it. But regardless, we are going to be, we make the greatest military equipment in the world, whether it's missiles,' he added. Trump also unveiled a deal under which NATO will buy arms from the US and then distribute them to Ukraine amid the ongoing war with Russia. He said, 'The only one we haven't been able to get to yet is Russia, and I'm not happy. And I will tell you that Ukraine wants to do something again. It's a war that should have never started. If I were president, it never would have happened. I used to speak to President Putin about it a lot. It was the apple of his eye. But once I saw what was going on, I said, they're going to they're going to have a war here. I was outside. Lecture was rigged and I was outside looking in and I said, you know, that thing's going to be a war. Couldn't believe it because what Biden said was the exact opposite of what should have been said and it started and it's a real mess. We're losing I guess they're losing five or six thousand people a day. It's actually now more.' 'I used to was saying 5,000 a day. It's actually more now, mostly soldiers but a lot of people in cities and towns that are getting blown up to it's a horrible war and it should be stopped. And so if it's not done, if we don't have an agreement in 50 days, that's what we're doing secondary tariffs and they're biting and I hope we don't get to the point where we do, but I I've been hearing so much talk. It's all talk. It's all talk and then missiles go into Kyiv and kill 60 people. It's got to stop. But, the purpose of this is to say that this is a very big deal we've made. This is billions of dollars worth of military equipment is going to be purchased from the United States going to NATO etc. And that's going to be quickly distributed to the battlefield, Ukraine will take it up,' he added. Last week, US Secretary of State Marco Rubio said that he echoed US President Trump's 'disappointment and frustration' at the lack of progress in peace talks during his meeting with Russian counterpart Sergey Lavrov and expressed America's willingness to engage. Speaking to reporters in Kuala Lumpur on July 10 after his meeting with Lavrov, Rubio stated that the US' strategy is to continue engaging all parties involved in finding an outcome to the conflict between Russia and Ukraine. Rubio described his talks with Lavrov as 'frank and important.' When asked about his message to Lavrov during the meeting, he said, 'Our strategy is to continue to engage all the parties that are involved in finding an outcome to this conflict. We will engage anytime that we have an opportunity to do so, like we did today. I echoed what the President said - both the disappointment and frustration at the lack of progress in peace talks or in a path forward. So, we'll continue to engage.' 'We shared some ideas and comments, which I'll take back to Washington as early as this evening in terms of calls and reflected, and perhaps there's something to build on there. But, it was a frank conversation. It was an important one. We had it, and we talked about some other items as well unrelated to the war in Ukraine, but that was the - obviously, the first and foremost topic that we discussed. And look, the President's been pretty clear. He's disappointed and frustrated that there's not been more flexibility on the Russian side to bring about an end to this conflict. We hope that can change, and we're going to continue to stay involved where we see opportunities to make a difference,' he added. Marco Rubio met Sergey Lavrov on the sidelines of the Association of Southeast Asian Nations (ASEAN) summit in Kuala Lumpur. The meeting between Rubio and Lavrov came just days after Trump expressed frustration with Russian President Vladimir Putin for not engaging in peace talks regarding the Ukraine conflict. (ANI)