Asia Responds to Washington's 'Global War on Trade'

More damage likely than from Global War on Terror

By: Salman Rafi Sheikh

In late March, the Foreign Ministers of Japan, South Korea, and China met in Tokyo to reinforce the importance of regional peace, agreeing that maintaining cooperation in the Korean peninsula was a shared responsibility. The United States, which has 28,500 US military personnel in South Korea and works closely with South Korean troops, did not attend.

Top trade officials from all three countries were to meet again this weekend in Seoul. South Korea’s Industry Minister Ahn Duk-geun hosted the meeting with Japan’s Yoji Muto and China’s Wang Wentao on Sunday, the first such gathering among the three nations in five years. More importantly, these meetings are taking place against the larger backdrop of US tariffs.

Whereas Japan has been hit by several tariffs pertaining to the export of steel to the US, recently imposed tariffs on automobiles are going to hurt both Japan and South Korea. The ongoing ‘global war on trade’ (GWOT), an acronym bearing a remarkable similarity to the notorious ‘Global War on Terror’ (GWOT), is not merely a policy. For countries affected by it, including close US allies like Japan, it presents a geopolitical shift.

China is obviously a key target of US tariffs and perhaps the central player in the ongoing GWOT. But the ‘War on Trade’ may prove to be a lot more disruptive than the ‘War on Terror’ because Washington is waging it not primarily against non-state actors but against proper states, many of them its allies, and their economies. Some of these states not only have the capability to respond in the same manner but, more importantly, they can – and are already seeking to – recalibrate their ties with the US and with other states being affected by the trade war.

In other words, enemies and rivals are being rethought as friends. As Japan’s foreign minister said after he met with his counterparts from South Korea and China: “The international situation has become increasingly severe, and it is no exaggeration to say that we are at a turning point in history,” making it extremely “important than ever to make efforts to overcome division and confrontation.”

China’s Wang Yi noted this year marks the 80th anniversary of the end of World War II, saying “only by sincerely reflecting on history can we better build the future.” This is leading to many fresh starts. After the trilateral meeting, China and Japan also held their first so-called “high-level economic dialogue” in six years.

“The global economy is facing serious changes. Unilateralism and protectionism are spreading,” Wang told reporters, adding that “China and Japan, as major economies, should pursue development and cooperation together with innovative thinking and bring stability to a world full of uncertainty.”

The uncertainty is not simply rhetorical. For instance, due to fresh tariffs on the export of automobiles to the US, Japan’s car industry is predicting a critical impact, leading to major dips in the shares. The world's top-selling automaker, Toyota, closed down 2.0 percent, while Nissan shed 1.7 percent and Honda was off 2.5 percent. In South Korea, Hyundai shares dipped 4.0 percent. According to some estimates, Japan’s overall car production could see a more than 4 percent decline due to these tariffs. In 2024, Japan's automobile exports to the US totaled about US$40 billion, making up 28.3 percent of its exports to the country. In 2024, South Korea's exports of automobiles to the US stood at $34.7 billion, accounting for 49 percent of its total auto exports.

While these countries are in the middle of dealing with these tariffs and their impact, their biggest trouble probably lies in the White House, currently occupied by an extremely unpredictable political leadership relentlessly pushing economic nationalism at the expense of multilateralism. In some ways, multilateralism simply does not matter. Therefore, some form of ignorance about it within the Trump administration is also warranted. When Pete Hegseth appeared before the UC Congress for his confirmation hearing, he failed to name any single member state of the Association of Southeast Asian Nations (ASEAN).

What is even more ironic is that the association includes several states such as the Philippines with deep military ties with Washington. The total ignorance of the US defense minister, otherwise responsible for cultivating defence ties for the furtherance of US strategic interests, serves as a good context for ASEAN member countries to reorient themselves in ways that, for instance, reinforce a more regionally focused approach to issues pertaining to trade and territory than a more globally focused, Washington-backed approach to ‘contain’ China.

How well was Hegseth received in Japan during his maiden visit? Was he able to achieve anything meaningful? First of all, what he offered was the usual, worn and torn rhetoric of ‘countering China.’ Japan is itself doing that, not only by engaging with China but also by deciding to beef up its own military capability. Japanese officials are cognizant of US demands for spending more on joint defense. But Japan is keen to invest more in building its own national capacity.

With a focus on China, however, Hegseth’s message to Manila and Tokyo was to “reassure” these countries of continued US support. But these countries have questions about the reliability of US support in the wake of US attempts to damage their economies simultaneously. The fact that Hegeseth’s talks included no reference to the key source, i.e., tariffs, introducing nervousness and instability to the alliance, shows why the prospects of keeping things as usual are grim.

Reports show Japanese political elites divided on ties with the US. One Japanese official said Tokyo faces a difficult time because some of the country’s assumptions about the alliance in recent decades “suddenly look like they are not supported by the language coming out of the White House,” adding that there is a camp in Tokyo that believes real problems in the US will emerge in the future. The second camp believes that those problems are already here.

But no camp believes these problems can be effectively overcome. The same official said, “It is very hard to say that you can definitely rely on the US now, and as soon as you allow that thought to exist, you have to admit that Japan needs to do a lot more to defend itself.”

These thoughts are not limited to Japan. They may not be as pronounced in other traditional US allies, but they are there. Trump himself is reinforcing these ideas. When he recently said that the US would sell a toned-down version of the F-47, a new fighter jet being developed by Boeing, to allies because “someday maybe they’re not our allies,” he basically indicated that he doesn’t see any current US allies, including in Asia, as permanent US allies.

Given this, it makes a lot more sense for countries like Japan to not only review their ties with Washington but also to find alternatives. Importantly, because China is being equally – and perhaps even more – hurt by Washington’s trade war, regional countries are likely finding Beijing’s elites a lot more amenable than they otherwise would be.