China’s president visited Vietnam, Malaysia and Cambodia amid ongoing efforts in the region to respond to the US tariffs
Chinese President Xi Jinping visited Vietnam, Malaysia and Cambodia during his April 14-18 trip to South-east Asia. He urged regional states to “oppose unilateral bullying” and uphold free trade, referencing the now-paused tariffs that US President Donald Trump imposed on April 2. China and the United States, which have long vied for influence in the region, are ASEAN’s top two trade partners.
What’s next
Subsidiary Impacts
- Vietnam, Malaysia and Cambodia will continue highlighting the importance of improved relations with China.
- Agreements on new infrastructure links between China and Vietnam will increase the capacity for bilateral trade.
- Following Xi’s visit, Washington probably has a largely unchanged opinion of Hanoi and Kuala Lumpur but may see Phnom Penh more negatively.
Analysis
The timing of Xi’s visit was decided long ago, before the Trump administration imposed sweeping tariffs on US trade partners on April 2. Cambodia, Vietnam and Malaysia were hit with duties of 49%, 46% and 24%, respectively. Most of the rates above 10% (including for these three countries) were postponed for 90 days on April 9, although the blanket 10% tariff remains in place (see MALAYSIA: Country will cope with economic headwinds – April 16, 2025).
Xi’s exhortation to resist bullying was a clear reference to the United States. He portrayed China as a source of “stability and certainty.”
Vietnamese, Malaysian and Cambodian officials appeared keen to engage with the Chinese president. Vietnamese leaders described consolidating ties with China as a “top priority”, a “strategic choice” and an “objective requirement”.
The numerous cooperation agreements whose signing Xi oversaw cover various areas, including digital technology, green energy and improved transport infrastructure. Some had been agreed months earlier. Most are non-binding.
Among the most significant is the agreement to conduct feasibility studies for new railway lines connecting Vietnam and China. Communist Party of Vietnam General Secretary To Lam called these the “highest priority” in infrastructure cooperation (see SOUTH-EAST ASIA: Geopolitics will shape infrastructure – April 2, 2025).
In Malaysia, which holds ASEAN’s annually rotating chairmanship this year, Xi indicated that Beijing was eager to sign the China-ASEAN Free Trade Area Upgrade Protocol — an upgrade to the existing trade agreement between the sides — “at an early date”.
Economic and diplomatic balancing
No South-east Asian country — certainly none of the three states Xi visited — wants to alienate either China or the United States, given the importance of both players to regional trade. According to ASEAN data, China and the United States were the top destinations for ASEAN exports in 2023. Meanwhile, China was by far the largest source of regional imports, ahead of the United States.
Trump’s tariffs are a major concern in the region. The United States accounts for about 40% of Cambodia’s export revenue and around 30% of Vietnam’s. Vietnam has cut tariffs on US imports and agreed to purchase more US-made goods to reduce its sizeable trade surplus with the United States, and Cambodia has promised to reduce tariffs on most US imports.
Vietnam is especially under pressure to reduce its trade surplus with the United States
On April 9, Vietnamese Deputy Prime Minister Ho Duc Phoc met US Trade Representative Jamieson Greer in Washington. The next day, he met US Treasury Secretary Scott Bessent. Following the Phoc-Greer meeting, Vietnam announced that it had agreed with the United States to begin talks on a trade deal.
Cambodia’s special tariffs team held online talks with Greer on April 16 and a Malaysian delegation will be in Washington for talks this week.
A complicating factor in the various negotiations may be the US Department of Commerce’s announcement yesterday of plans to impose tariffs on imports of solar panels from Vietnam, Cambodia, Malaysia and Thailand, in connection with an investigation that began nearly a year ago. The rates — aimed at tackling alleged dumping, helped by Chinese subsidies, on the US market — vary by country and company. Whether they are applied will hinge on a final determination by the US International Trade Commission in June.
Struggling to keep all sides happy
Xi’s visit could make it harder for Hanoi, Kuala Lumpur and Phnom Penh to satisfy both Beijing and Washington at this juncture. After China’s leader arrived in Hanoi, Trump said China and Vietnam were trying to “figure out” how to “screw” the United States.
Nevertheless, Washington will not punish South-east Asian leaders for engaging with Beijing. Trump said he did not blame China and Vietnam for their meeting.
Washington will closely observe the manoeuvring between South-east Asian states and Beijing
The Trump administration will be particularly keen to maintain good ties with Vietnam (because of its economic importance to Washington and US companies) and Malaysia (especially as it is the ASEAN chair this year). However, it may look less favourably on Cambodia, whose relations with the United States have followed a broadly downward trajectory for several years.
Just days after Vietnam hosted Xi, Vietnamese Prime Minister Pham Minh Chinh said his country had a “unique bond” with the United States.
China does not want to see South-east Asian partners becoming economically (and possibly politically) unstable because of US tariffs. However, a spokesperson for its Ministry of Commerce said yesterday that Beijing opposed any party reaching a tariff deal “at the expense of China’s interests”.
Many Chinese companies investing in South-east Asia depend on exporting goods to the United States, but Washington will demand that regional states clamp down on re-routing of Chinese goods through their territories.
Future balancing
The new investment deals and Xi’s promises of stability could enable Vietnam, Malaysia and Cambodia to negotiate with the United States over tariffs from a strengthened position, but only if Washington:
- is satisfied that the new investment pledges will not increase trans-shipment of Chinese goods through South-east Asia; and
- prioritises US geopolitical advantage ahead of reducing the US trade deficits with the countries.
US decision-making since Trump began his second term in January suggests that neither of these is assured. The Trump administration has multiple trade-related objectives that are not easily reconciled, and thus remains unpredictable.
If South-east Asian states can avoid high tariffs, they will be more confident about maintaining their long-standing hedging policy towards the United States and China.
If unsuccessful in their negotiations, they may calculate that they have little choice but to align more closely with China. However, that would weaken their ability to push back against Beijing in areas of disagreement.
There was notably little talk during Xi’s visit about the South China Sea, where China, Taiwan and a handful of South-east Asian states — including Vietnam and Malaysia — have competing claims, and where Chinese aggression in the exclusive economic zones of rival claimants continues.
Chinese President Xi Jinping (left) meeting Communist Party of Vietnam General Secretary To Lam (right) in Hanoi on April 14 (Nhac Nguyen/Pool/AFP/Getty Images)
Authored by:
Dr Joydeep Sen
Deputy Director & Senior Analyst,
Asia Pacific
