Trump 2.0 and the Emerging Asian Trade and Politics

Scenario 1: Russia is engaged in war with Ukraine for the last more than 1000 days. Europe is compelled in its engagement to back Ukraine to contain Russian aggression.

Scenario 2: Israel is messed up in the Middle-east; including with Iran.

Take-away: Middle-East and Europe—in which the U.S. keeps itself strategically out, are embroiled in themselves.

Scenario 3: Asia is peaceful. But the U.S. is on trade deficit with China, South Korea, Japanese, Vietnam, India and others; meaning thereby that the U.S. needs to correct it as President Donald Trump has clearly come out. North Korea and China have been rolling their eyes up, which Trump would not like.

Asia is on Focus of Trump’s Challenge

With Europe and Middle-East caught up in themselves, Trump’s principal challenger is Asia. Therefore, Asia is likely to be on the receiving end as Trump 2.0’s foreign policy will particularly take-on Asian nations, though approaches for different nations will differ in accordance with trade and geopolitics situations.

Australia is away. But if need is so felt, Trump administration will find it suitable to rout imports through Australia, to keep Asian countries to their places.

The U.S.’s Asian policy, businessman that Trump is, thus, will be centred on trade as well as on military.

Trade

Trump through his “America First” and “Make America Great Again”policy, has made it clear that he does not like trade deficits. Trump’s“Drill Baby Drill”energy policy that he announced on the day of his inauguration ceremony on January 20, 2025 too, makes it clear that he is going to give a toss to environment concerns—the U.S. has already pulled itself out of Paris environment treaty—and will hugely extract oil and natural gas, and ensure that all the world imports U.S. energy.

This economic strategy is part of further weakening the oil and natural gas producing nations in the Middle-East including Iran as well Russia, and keeping them all to their place. This is to ensure that trade surplus nations with the U.S., including the European nations, consume U.S. energy if they do not want U.S. tariff.

China trade Surplus with the U.S.

In November 2024, US imports from China reached about $203bn, up 6.8 percent from $190bn over the same five months in 2023.

Chinese imports from the US dropped by 11.2 percent from $14bn to $12.4bn in November 2024 compared with November 2023.

The trade surplus of China with the U.S. is a record $1 trillion.

Trump has announced 60 % tariff on all imports from China. China is a major player on electronic vehicles, apart from other cheap electronic goods.

President Trump will have to beef up manufacturing at home in order to level possible decreased imports from China, so that domestic consumers do not have a situation of price rise.

As labour is cheap in China, U.S. has to offer goods on competitive price to its domestic consumers. Thus, Trump administration will walk on a double-edged blade.

South Korea’s trade Surplus with the U.S.

South Korea has a mounting trade surplus with the United States. It stands at around 44 billion U.S. Dollars in 2023-24. South Korea supplies mainly agricultural products to the United States. The list includes processed fruit and vegetables, snack foods, fresh fruit, fresh vegetables, and dairy products.

South Korean leadership would have to now adopt a policy of more imports from the U.S. if they want to avoid Trump’s tariff.

Vietnam’s trade surplus with the U.S.

By the end of 2024, Vietnam enjoyed a trade surplus with the U.S. of of $111.6 billion, which in the corresponding quarters in 2023 was $94.8 billion.

Vietnam exports to the U.S. include electronic and electrical goods, furniture, machinery, meat, fish, sea food preparations etc.

Vietnam will require more imports from the U.S. if it wants to avoid Trump’s tariff. One main thing that the U.S. wants Vietnam to import is oil and natural gas.

The India-US Trade

In 2023-24, the US was the largest trading partner of India. The trade volume stood at $119.71 billion.

The export volume for India stood at $ 77.51 billion, and import volume from the U.S. was $ 42.19 billion. Thus, India enjoyed a trade surplus volume of $35.31 billion.

India has been maintaining equi-distance policy from Russia and the U.S. since long. India is in a catch-22 situation vis-à-vis the U.S.-Russia dichotomy.

At present India imports a bulk of its energy requirements from Russia. But with Trump’s ‘Drill Baby Drill”, oil market is sure to be cheaper in the coming days—which will directly hit Russia, and make countries like India forced to go for U.S. oil and natural gas.

Trump’s Drill Baby Drill policy is actually aimed at taking Russia, Iran and other such countries head-on, and force countries like India buy American energy.

Other East Asian countries like Taiwan, which literally enjoy protection by the U.S. against Chinese aggressive, will have to pay in different ways to the U.S. military aids.

Major goods supplied by Southeast Asia to the U.S. are electrical machinery, garments, raw materials, agricultural products including fruits and dry fruits, and sea food.

China on the Radar of Trump’s trade approach

China has been focusing on the production of electronic vehicles. As the costs of electronic vehicles gets more and more competitive in the market, competitive fuel price that Trump’s energy policy offers, will make the car prices more competitive. Chances are that cost owning a fossil-fuel car will offer a competitive edge vis-à-vis owning an electronic car. This approach of the U.S. will keep China to its place.

Summing Up

For once, the United States which stands for free market, has been re-thinking on it. As President Trump thinks to adopt a restrictive free market and cautious protectionism, Trump 2.0 is in for a new global change in geopolitics, particularly in Asia and Europe.