Asian economies will suffer due to the trade war between the United states and China. US president Donald Trump alleges that the World second biggest economy, China has unfair trade practices and has threated to implement new trade tariffs on approximately $450 billion of China’s exports. China swore to counter back.
China’s retaliation means bad news for international trade powerhouses such as Taiwan, South Korea, Malaysia, who sell goods to China used to manufacture electronics. The electronics are then exported to the U.S. Asian trade relations are fundamental to regional economies.
One dynamo that stands to lose the most is Taiwan, because it exports tech components such as computer chips to China, which is turn is exported to the United States. Asia economist Gareth Leather said if the demand for Chinese smartphones goes down, the Taiwanese computer chip demand will also be impacted.
South Korea, whose top two markets are China and the U.S, shares in two South Korean companies – Samsung electronics and SK Hynix have depreciated in recent weeks. Singapore and Malaysian companies will be impacted as they also export electronic components.
Source: CNNMoney (Hong Kong)