Asia Daily: April 23, 2025

South East Asia

US to impose new duties on solar imports from Southeast Asia. The United States will impose tariffs as high as 3,521 percent on solar panel imports from Cambodia, Thailand, Malaysia, and Vietnam, targeting what it calls unfair Chinese subsidies and dumping practices. The move, stemming from a year-long investigation prompted by major U.S. solar firms, awaits final approval from the International Trade Commission in June. Companies like Jinko Solar and Trina Solar face steep duties based on their export origins. The tariffs aim to counter transnational subsidies and support the american domestic solar industry. Channel News Asia, April 21

China

US Treasury secretary says trade war with China is not ‘sustainable’. U.S. Treasury Secretary Scott Bessent described the current tariff standoff with China as unsustainable and indicated a likely de-escalation, though formal talks have yet to begin. Speaking privately to JPMorgan Chase, Bessent acknowledged the 145% tariffs imposed by President Trump on Chinese imports and China's 125% retaliatory duties. Despite market volatility and rising debt costs, Trump downplayed the tension, stating relations with China remain amicable and that final tariff rates would be reduced. The ongoing uncertainty has spurred calls for rate cuts from Trump, while the Federal Reserve maintains its stance amid inflation concerns. Josh Boak and Fatima Hussein, AP News, April 22

Japan

Japan to cut energy, electricity costs amid inflation: PM. Prime Minister Shigeru Ishiba announced new inflation relief measures, including fuel price reductions and summer energy subsidies for households. Starting May 22, gasoline and diesel prices will be cut by 10 yen per liter, and kerosene and heavy oil by 5 yen. From July to September, additional support will help offset rising electricity and gas bills during peak demand. These steps replace earlier plans for cash handouts and come ahead of the House of Councillors election, critical for Ishiba’s minority government. The relief is intended to counteract persistent inflation, which rose 3.6 percent in March, driven by energy and food costs. Kyodo News, April 22

Yen on the march as Plaza Accord 2.0 debate grows. The yen surged to a seven-month high of ¥139.9 to the dollar, intensifying speculation about a potential "Plaza Accord 2.0" as the U.S. accuses Japan of currency undervaluation. While U.S. officials have floated the idea of coordinated intervention, Japan insists exchange rates should be market-driven. Finance Minister Katsunobu Kato is set to meet U.S. Treasury Secretary Scott Bessent in Washington, though analysts doubt any agreement resembling the 1985 Plaza Accord will materialize. Experts argue that joint currency intervention could destabilize markets and risk inflation, favoring monetary policy adjustments, such as a Bank of Japan rate hike—as a more effective and safer approach. Kazuaki Nagata, The Japan Times, April 22

Taiwan

Pharmacist associations protest ministry in Taipei. The Federation of Taiwan Pharmacists Associations staged a protest in Taipei against the Ministry of Health and Welfare’s interpretation of Article 103 of the Pharmaceutical Affairs Act, which they argue permits unqualified individuals to operate Chinese medicine businesses, endangering pharmaceutical safety. Federation president Huang Jin-shun demanded a withdrawal of the interpretation and the resignation of key ministry officials. In contrast, Chinese medicine industry groups supported the ministry, citing its role in reviving a declining sector. The ministry, which issued the interpretation on March 18, plans to integrate herbal medicine into pharmaceutical categories and implement stricter classifications based on safety and function. Lin Hui-chin and Jake Chung, Taipei Times, April 22

Lai backs NT$400bn green investment. President William Lai announced over NT$400 billion in climate adaptation investments through 2025 as part of Taiwan’s broader plan to reach net-zero carbon emissions by 2050. Speaking at a meeting with environmental groups, Lai highlighted the National Climate Change Committee’s emission reduction goals—32 percent by 2032 and 38 percent by 2035—with a 2 percent flexibility margin. He discussed the need for a second energy transition focused on renewables, conservation, and storage. Lai also pledged to boost energy imports from the U.S. to avoid looming tariffs, while reaffirming that any change in nuclear policy must meet safety, waste management, and public consensus standards. Chen Yun, Chien Chia-yi and Jake Chung, Taipei Times, April 22

South Korea

IMF slashes Korea's 2025 growth outlook to 1%. The International Monetary Fund has lowered South Korea's 2025 economic growth forecast to 1 percent, a sharp downgrade from its earlier 2 percent projection, citing increased global and domestic uncertainties, including trade tensions and policy instability. The 2026 outlook was also revised down to 1.4 percent. Other institutions have similarly cut their forecasts, with the Bank of Korea predicting 1.4 percent growth for 2025 and the OECD estimating 1.5 percent. Despite these downward revisions, S&P Global Ratings maintained Korea’s AA credit rating with a stable outlook. Globally, the IMF cut its 2025 growth forecast to 2.8 percent under its April 4 reference scenario, with alternative forecasts showing minor variation based on evolving trade policies, particularly U.S.–China tariffs. Jie Ye-eun, The Korea Herald, April 22

Four presidential contenders to advance to next round of PPP primary. The People Power Party has selected four candidates to proceed to the second round of its primary ahead of South Korea’s June 3 presidential election: former Labor Minister Kim Moon-soo, Rep. Ahn Cheol-soo, former interim leader Han Dong-hoon, and ex-Daegu Mayor Hong Joon-pyo. The selection, based on surveys of 4,000 respondents, excluded Incheon Mayor Yoo Jeong-bok and others. The next stage includes televised debates and votes from party members, with results determined equally by public polling and party votes. Kim currently leads among PPP contenders in a national poll but trails Democratic Party’s Lee Jae-myung, who holds 50.2 percent support. Jung Min-kyung, The Korea Herald, April 22

Seoul launches 4th spy satellite to boost NK surveillance. South Korea successfully launched its fourth domestically developed spy satellite on Tuesday, increasing its surveillance capabilities over North Korea. The satellite, equipped with synthetic aperture radar (SAR) for all-weather, day-and-night imaging, was deployed via SpaceX’s Falcon 9 rocket from Cape Canaveral and entered orbit within minutes. Once verified through performance and operational testing, it will begin reconnaissance missions. With this addition, South Korea strengthens its satellite network aimed at reducing revisit times and enabling faster threat detection. The military plans to complete a five-satellite system by 2025 for real-time monitoring of key North Korean sites. Hwang Joo-young, The Korea Herald, April 22

Myanmar

Myanmar junta extends post-earthquake truce. Myanmar’s military junta has extended a ceasefire until April 30 to support ongoing relief and reconstruction efforts following the March 28 earthquake that killed over 3,700 people and displaced more than 60,000. Despite ongoing clashes during the initial 20-day truce, the extension aims to facilitate aid delivery for two million people in urgent need. The junta warned it would retaliate if attacked. Channel News Asia, April 22

India

Gunmen kill at least 26 civilians in Kashmir tourist hotspot. At least 26 civilians were killed in Pahalgam, a tourist area in Indian-administered Kashmir, when gunmen opened fire on a group of visitors in the region's deadliest civilian attack since 2000. Witnesses reported that the assailants specifically targeted men while sparing women. The attack, which occurred amid heightened tourism in the area, prompted Prime Minister Narendra Modi to condemn the violence and vow justice. No group has claimed responsibility, though the region has faced decades of insurgency. The assault comes as authorities promote Kashmir as a peaceful holiday destination and follows years of relative calm since the revocation of the region’s autonomy in 2019. Channel News Asia, April 22

Australia

Australians start voting in general elections as pope’s death overshadows campaigning. Australians began early voting for the May 3 general election on Tuesday, as the death of Pope Francis prompted a suspension of campaign events by both Prime Minister Anthony Albanese and opposition leader Peter Dutton. With around half of votes expected before election day, campaigning paused as national flags flew at half-staff and both leaders attended memorial Masses. Despite the somber mood, Albanese and Dutton participated in a televised debate that evening, with Dutton accusing Albanese of weak leadership and dishonesty, while Albanese responded by denouncing personal attacks. The center-left Labor Party is seeking re-election with a slim majority, while both major parties anticipate a tight race. Rod Mcguirk, AP News, April 22

Northeast Asia

Analyzing the Impact of the U.S.-China Trade War on China’s Energy Transition. Escalating U.S.-China trade tensions risk derailing China’s energy transition by weakening its economy and changing stimulus priorities toward emissions-intensive sectors. Tariffs and export controls on critical minerals disrupt supply chains and reduce incentives for decarbonization, especially if global partners like the EU relax green standards. China’s clean energy industries—particularly lithium-ion batteries, of which 25% were exported to the U.S. in 2024—face declining demand and may experience consolidation or overcapacity exacerbated by state intervention. Trade pressure could lead to reduced investment in renewable deployment and R&D, especially where funding depends on local governments or private firms. While exports of solar panels and EVs to Southeast Asia and Latin America grow, scrutiny of Chinese overseas production is increasing, potentially curbing circumvention strategies. U.S. restrictions, such as those under the Uyghur Forced Labor Prevention Act, have already prompted Chinese firms to relocate production abroad. If other nations reach tariff deals with the U.S. but China remains excluded, its firms may pursue further offshoring despite increased geopolitical and technology leakage concerns. The trade war’s long-term impact may reshape global clean tech supply chains and slow progress on climate goals unless mitigated by international cooperation. Ilaria Mazzocco, Center for Strategic and International Studies, April 22

The New North Korea: How Geopolitical Advantages and Growing Middle Class Prosperity Challenge the Next South Korean President. North Korea’s evolving geopolitical leverage and expanding domestic consumer class are reshaping the strategic environment ahead of South Korea’s June 2025 presidential election. The DPRK has pivoted from unification to a doctrine of two hostile Korean states, while simultaneously gaining military and economic support from Russia and China, thereby weakening international sanctions. Its internal economy, long driven by autarky, is now bolstered by a burgeoning middle class with rising purchasing power, evident in increased consumer goods, smartphone usage, and service sector growth. This transformation reduces the regime’s reliance on foreign engagement, undercutting prior inter-Korean exchange mechanisms like joint tourism and humanitarian aid. The emerging multipolar world order, marked by declining U.S. influence and fractured norms, further emboldens Pyongyang. For South Korea, these changes complicate strategic planning, especially as traditional alliance structures weaken, U.S. tariffs strain the export economy, and demographic challenges persist. Even a pro-engagement administration may deprioritize North Korea policy, given the diminished leverage and heightened risks. This double challenge of geopolitical fragmentation and reduced North Korean dependency presents a formidable test for the next South Korean president’s approach to inter-Korean relations. Ruediger Frank, 38 North, April 22

Europe’s China Challenge: Why Unity Is the Only Way Forward. As global tensions heighten in 2025, the EU faces mounting pressure to unify its approach to China. The bloc’s 2019 framework defining China as a “partner, competitor, and systemic rival” no longer suffices amid Donald Trump’s renewed U.S. presidency, economic stagnation, and escalating geopolitical rivalries. European divisions—exemplified by Macron’s Taiwan remarks—undermine transatlantic cooperation and empower Beijing’s divide-and-rule tactics. To counter strategic vulnerabilities, the EU must strengthen internal coordination on issues such as trade, technology, and security. Key initiatives include a “de-risking” economic strategy, defense policy enhancements, and proposals like a permanent China Task Force. Unity would bolster EU efforts to diversify supply chains, resist coercion, and engage global partners through platforms like the Global Gateway. The European Commission’s proactive tools, including anti-coercion measures and foreign subsidies regulations, reflect this change. With Trump linking security assurances to economic alignment and China courting European mediation in global conflicts, a coherent EU stance is crucial to maintaining leverage. A special summit to align high-tech controls and industrial policy would solidify Europe’s geopolitical role. Fragmentation risks diminished influence; unity enables the EU to defend its interests and shape a stable global order. Stefan Messingschlager, SOAS China Institute, April 22

Hollywood May Not Be Spared China’s Cultural Ascent. A potential Chinese ban on Hollywood films, amid escalating U.S.-China trade tensions, could accelerate cultural decoupling and inflict large financial losses on American studios. In 2024, Hollywood earned $585 million from the Chinese market, demonstrating China’s role as the world’s second-largest box office. Losing this market would destabilize already strained studios grappling with debt, streaming disruptions, and post-strike delays. Meanwhile, China’s domestic film industry is thriving, with 80% of 2025 box office revenue generated by local productions like Ne Zha 2 and The Wandering Earth II. State support and changing Gen Z preferences are fueling China’s cultural self-reliance. Hollywood’s response may involve deeper market diversification, partnerships with Asian streaming platforms, or further self-censorship—each with risks. China is also leveraging cinema for soft power, promoting state-aligned narratives and subsidizing domestic film consumption. As China asserts narrative control and Hollywood faces investor uncertainty, the global entertainment landscape risks bifurcation: one ecosystem prioritizing creative freedom, the other operating under political and ideological oversight. This evolving divide may force studios to choose between market access and artistic integrity in a fragmented cultural order. Tang Meng Kit, RSIS, April 22

Why China Should Welcome a U.S.-Iran Thaw. Ongoing U.S.-Iran negotiations signal a possible diplomatic breakthrough, with both nations showing openness to de-escalation under President Trump’s second term. While some talks remain indirect, Iran’s markets have already responded optimistically. Driven by political pressure, economic hardship, and declining influence of the "Axis of Resistance," Tehran is increasingly receptive to engagement. Internally, reformist President Masoud Pezeshkian supports dialogue, clashing with hardliners like the IRGC. A normalized U.S.-Iran relationship could lift sanctions, attracting foreign investment and technology vital to Iran’s recovery. Although China is unlikely to mediate, it stands to benefit from improved ties, as eased sanctions would facilitate deeper economic cooperation and stabilize the Middle East—a region where China prefers peace to assert influence. Beijing’s strength lies in post-thaw engagement, not direct intervention, and a diplomatically diversified Iran is expected to maintain strong ties with China. Thus, a U.S.-Iran thaw, while politically exclusive, promises strategic and economic dividends for China. Fan Hongda, ThinkChina, April 22

Southeast Asia

How Southeast Asia Sees Xi Jinping’s Regional Push Amid U.S.-China Tensions. Xi Jinping’s April 14–18 visit to Vietnam, Malaysia, and Cambodia reinforced China’s diplomatic and economic presence amid escalating U.S. trade tariffs. Across the tour, 113 agreements were signed, covering sectors from infrastructure and digital economy to defense and education. While the visits signaled stronger bilateral ties and demonstrate China’s role as a strategic partner, they also exposed lingering tensions—especially maritime disputes with Vietnam and debt-related concerns in Cambodia. Vietnam, although deepening cooperation, remains cautious over South China Sea issues and U.S. pressure on transshipment practices. Cambodia welcomed China’s support but focused on fiscal prudence and diversified foreign investment to maintain strategic autonomy. Malaysia, while aligning rhetorically with Beijing against U.S. “economic tribalism,” signed largely symbolic MOUs, yet launched a notable “two plus two” dialogue mechanism with China, looking to increase political-security coordination. Despite China’s assertive outreach, Southeast Asian nations continue to hedge, striving to balance economic gains with geopolitical flexibility. Xi’s tour affirmed China’s influence, but regional governments remain wary of overdependence, prioritizing multilateralism and strategic optionality in the evolving U.S.-China rivalry. Li Mingjiang, Le Hong Hiep, Neak Chandarith, and Ngeow Chow Bing, Carnegie Endowment for International Peace, April 22

Vietnam Goes Big in Its Sprint to 2030. Vietnam’s General Secretary To Lam has launched a sweeping development campaign for 2025–2030, branding it a ‘sprint period’ essential to securing upper-middle-income status by 2030 and high-income status by 2045. The government aims for 8 percent GDP growth in 2025 and double-digit growth thereafter. Central to this plan is a dramatic institutional overhaul—reducing ministry-level agencies from 22 to 17, cutting 100,000 public sector jobs, and reorganizing provincial structures. Major infrastructure revivals include a $67 billion North–South high-speed rail, nuclear plants, and port upgrades. A pivot to high-tech industries is underpinned by a new resolution allocating 3 percent of the national budget to innovation, with major foreign investment from global tech firms already flowing in. However, this ambitious agenda faces hurdles: financial strain from concurrent megaprojects, risks of administrative disruption, and severe environmental degradation. Hanoi was ranked the world’s most polluted city in early 2025. Additionally, 46 percent U.S. tariffs pose a serious threat to Vietnam’s export-driven economy. While Xi Jinping’s April visit strengthened ties with China, it also intensified geopolitical balancing pressures. Vietnam’s success hinges on maintaining autonomy while navigating economic, political, and environmental difficulties in an increasingly volatile global order. Xuan Dung Phan, East Asia Forum, April 23

China’s Geopolitical Balancing Act in Post-coup Myanmar. As Myanmar’s junta loses territorial control following the October 2024 Operation 1027 by the Three Brotherhood Alliance, China has moved from backing both sides to overtly supporting the junta. Initially tolerant of ethnic armed organizations (EAOs) like the MNDAA and TNLA, Beijing reversed its stance when rebel success threatened Chinese investments and stability. China’s revised “multi-stakeholder strategy” includes pressuring EAOs to cease hostilities, reinforcing diplomatic and military ties with the junta, and facilitating controversial elections. Strategic interests—securing the China-Myanmar Economic Corridor, limiting Indian influence, and suppressing scam centers—drive Beijing’s pragmatism. However, China’s coercive tactics have increased anti-Chinese sentiment in Myanmar and strained ties with EAOs. Recent actions include trade route closures, live-fire drills, and the deployment of private military contractors. Despite professed non-interference, Beijing has solidified a pro-junta position, extending aid and legitimizing the regime internationally. This hardline approach risks alienating former allies and escalating regional instability, as EAOs consider resisting Chinese control. China’s strategic calculus, prioritizing infrastructure and regional leverage, may come at the cost of long-term influence in Myanmar. Khandakar Tahmid Rejwan and Scott N. Romaniuk, Geopolitical Monitor, April 22

Vietnam Navigates Trump’s Trade Headwinds: Making Virtue Out of Necessity. Facing steep U.S. tariffs under President Trump’s second term, Vietnam is employing a pragmatic strategy to mitigate trade risks while advancing long-term economic reforms. With a U.S. trade surplus of $124 billion—comprising nearly one-third of its GDP—Vietnam is particularly vulnerable to American protectionism. To preempt punitive tariffs, Hanoi has increased engagement with the Trump administration, signed deals worth over $4 billion to boost imports of U.S. LNG and high-tech goods, and leveraged high-profile commercial diplomacy, including partnerships with the Trump Organization and Vietjet. Simultaneously, the government is tightening rules of origin enforcement to prevent transshipment and reduce dependency on Chinese inputs. Vietnam is also courting U.S. tech firms, easing regulations to attract investments from companies like SpaceX and Nvidia. These steps align with General Secretary To Lam’s broader agenda for high-tech industrialization and double-digit growth by 2026. Although risks from Trump's tariffs remain, Vietnam views the pressure as a catalyst to climb global value chains, diversify trade partners, and modernize its economy—turning adversity into opportunity. Hoang Thi Ha, Fulcrum, April 22

Vietnam’s New Revolution: Will Provincial Mergers Bring Disruptions or Opportunities? Vietnam’s Central Committee has approved a landmark administrative reform reducing the number of provinces and municipalities from 63 to 34 and eliminating district-level governments. This overhaul, led by CPV General Secretary To Lam, also slashes commune numbers by 60–70% and restructures government agencies, forming a lean two-tier governance system. The objectives include improving bureaucratic efficiency, improving regional economic synergy, and cutting recurrent administrative costs that consume 70% of the state budget. Mergers like that of Ho Chi Minh City with Binh Duong and Ba Ria-Vung Tau aim to create economic hubs with increased trade and industrial capabilities. Despite concerns over naming disputes, transitional disruptions, and political centralization, the reforms have seen strong public support and minimal opposition. Politically, fewer provinces may shrink the CPV Central Committee and Politburo, consolidating influence under To Lam while posing risks of excessive centralization. Execution quality and public trust will determine the long-term impact. If successful, the reforms promise a more efficient, investment-friendly state apparatus, free public services, and stronger foundations for Vietnam’s high-income ambition by 2045. Le Hong Hiep, Fulcrum, April 22

Embracing Xi’s ‘Asian Family’ While Keeping U.S. Ties: Southeast Asia’s Tightrope. Xi Jinping’s April 2025 visit to Vietnam, Malaysia, and Cambodia focused on China’s solidarity with Southeast Asia in the face of Trump’s new tariffs. Xi promoted the idea of an “Asian family” anchored in regional cooperation, excluding U.S. influence. Each country hosted him with elevated protocol, demonstrating the strategic weight of his visit. China signed over 100 cooperation agreements across digital infrastructure, AI, connectivity, green energy, and the operation of COMAC aircraft. While aligning more closely with China, the three countries are simultaneously seeking to secure trade deals with the U.S., whose markets remain critical, accounting for 30% of Vietnam’s, 14% of Malaysia’s, and 40% of Cambodia’s exports. Southeast Asia is maintaining a balancing act: embracing Chinese economic support while signaling commitment to U.S. market access and security presence, particularly regarding the South China Sea. China’s approach avoids directly naming the U.S. but subtly counters its protectionist agenda. The region's tightrope strategy reflects efforts to navigate intensifying great power rivalry by leveraging both relationships. Lye Liang Fook, ThinkChina, April 22

South Asia

Can Pakistan Make the Sky Blue Again? Pakistan ranks among the most polluted nations globally, with PM2.5 levels reaching 73.7 µg/m³ in 2024—a 14% rise since 2019. Lahore met WHO air quality standards on just seven days in five years. Air pollution causes 50,000 deaths annually and reduces life expectancy by up to seven years in major cities. Economic costs exceed 6.5% of GDP, with smog disrupting agriculture, exacerbating food insecurity, and disproportionately impacting women, children, and low-income communities. The transport sector is the largest urban pollutant source, yet inconsistent data hinder regulation. The 2023 National Clean Air Policy aims for Euro-6 fuel by 2030, but high permissible PM2.5 limits undercut its effectiveness. A net-zero emissions pledge remains absent. Key solutions include stricter emission standards, robust air quality data access, improved vehicle inspections, real-time crop-burning monitoring, and sustainable agricultural waste management. Public-private recycling initiatives and adaptive governance are vital for long-term pollution control. Pakistan must prioritize scalable, inclusive, and enforceable interventions over symbolic fixes like smog towers. Hassan Aftab Sheikh, East Asia Forum, April 22

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