OPINION: Long-term Impact of the Influx of Low-cost Chinese Products into ASEAN

ASEAN's imports from China are expanding. In 2024, Thailand's imports from China increased by 13.8% from the previous year to 80.68 billion USD due to an increase in electronic integrated circuits and machinery imports. Similarly, Indonesia saw a 15.2% year-on-year rise to 71.63 billion USD due to an expansion in transportation equipment, electrical equipment and steel imports among other items. Malaysia's imports from China in 2024 went up by 14.8% year-on-year to 61.38 billion USD, with import increases in electronic parts, semiconductors, machinery, and other products. The reason behind this trend is that as China's main export destinations, the United States and the European Union, have tightened import regulations against China, products that have no place to go are now flowing into ASEAN countries at lower prices for purposes such as inventory clearance. Traditionally, steel manufacturers in China have increased their production capacity in an almost unplanned manner, resulting in excess capacity, which has led to frequent dumping of steel products. This trend has spread also to other products. The US, under President Trump, has set high tariffs on Chinese products, and the EU is tightening regulations such as anti-dumping duties.