Anwar Warns of Weaponized Trade Amid U.S. Tariff Threat

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Anwar Warns of Weaponized Trade Amid U.S. Tariff Threat \ Newslooks \ Washington DC \ Mary Sidiqi \ Evening Edition \ Malaysian Prime Minister Anwar Ibrahim warned that global trade is now being “weaponized” as ASEAN ministers gathered to address looming U.S. tariffs. Eight ASEAN nations face new duties on August 1 if trade deals aren’t reached. Only Vietnam has secured a reduction; others remain in urgent talks with Washington.

Quick Looks

PM Anwar says trade is now used to “pressure, isolate and contain”
ASEAN ministers meet amid U.S. tariff threat effective August 1
Eight ASEAN nations could face 20%–40% U.S. tariffs
Vietnam only ASEAN member to secure tariff reduction
U.S. Secretary of State Marco Rubio joins summit in Malaysia
Malaysia’s central bank cuts interest rates amid economic pressure
Malaysia’s trade minister warns sovereignty won’t be compromised in talks
ASEAN-U.S. summit expected later in 2025 to find joint position
Trade talks follow rising internal tensions, including Myanmar conflict
Rubio’s visit signals renewed U.S. engagement with Southeast Asia

Deep Look

Southeast Asia’s largest economies are scrambling to respond to an escalating trade standoff with the United States, as Malaysian Prime Minister Anwar Ibrahim warned that international commerce is no longer a neutral force but a tool of global pressure and containment.

Anwar’s stark message opened the Association of Southeast Asian Nations (ASEAN) annual foreign ministers’ summit in Malaysia, where leaders gathered under the shadow of impending U.S. tariffs that could reshape the region’s economic stability.

Though Anwar did not name the United States directly, his language was clear. “Power unsettles principle,” he said. “Tools once used to generate growth are now wielded to pressure, isolate and contain.” Anwar called on the 10-member bloc to move beyond rhetoric and strengthen economic self-reliance by increasing intra-ASEAN trade, investing in integration, and reducing strategic dependencies on global powers.

Trade at a Crossroads

At the core of the summit’s urgency is President Donald Trump’s newly revived tariff agenda. In April, Trump announced sweeping new tariffs on dozens of countries, including eight ASEAN members, but delayed enforcement for 90 days to allow time for negotiation. This week, he confirmed that tariffs—ranging from 20% to 40%—will go into effect on August 1 unless deals are finalized. He also threatened to escalate duties further if any nation retaliates.

The affected ASEAN countries and their proposed new U.S. tariff rates include:

Vietnam: 20% (down from 46%) – deal secured
Thailand & Cambodia: 36%
Indonesia: 32%
Malaysia & Brunei: 25%
Philippines: 20%
Laos & Myanmar: 40%

These new duties are expected to hit key export sectors including electronics, apparel, rubber, palm oil, and machinery—vital industries that underpin several ASEAN economies.

In reaction to the economic pressure, Malaysia’s central bank on Wednesday cut interest rates for the first time in five years to cushion potential trade fallout. The move underscores the financial uncertainty that Trump’s tariffs are already unleashing, even before taking effect.

Bilateral Talks, but Sovereignty at Stake

ASEAN countries have moved swiftly to engage the United States individually. Vietnam is the only country so far to finalize a deal, successfully reducing its tariff rate from a proposed 46% to 20%. The rest are still locked in bilateral negotiations, with several expected to extend into late July.

Malaysian Trade Minister Zafrul Aziz said Kuala Lumpur remains open to continued talks but drew a firm line against compromising national sovereignty. He pointed to ongoing U.S. demands related to government procurement, halal certification, digital taxation, and medical regulatory standards.

“It has to be fair,” Zafrul said. “If the deal does not benefit Malaysia, we should not have a deal.”

ASEAN’s Internal Strains Complicate External Unity

Compounding the urgency of trade talks are mounting internal tensions within ASEAN itself. The bloc remains fractured over how to respond to Myanmar’s civil war, which has raged since the military’s 2021 coup. A separate territorial dispute between Thailand and Cambodia is also simmering, adding friction as ministers gather.

Still, ASEAN is preparing for critical back-to-back meetings with major global powers, including the U.S., China, Russia, Japan, India, and the European Union, scheduled for Thursday and Friday.

U.S. Presence Signals Strategic Shift

U.S. Secretary of State Marco Rubio arrived in Malaysia on Thursday, marking his first visit to Asia since taking office. Rubio had earlier canceled trips to Japan and South Korea, but his presence in Kuala Lumpur signals Washington’s effort to reaffirm its role in Southeast Asia.

Anwar is expected to meet directly with Rubio to raise the region’s concerns over the tariff campaign and stress the importance of a balanced, rules-based trade environment. Analysts say Rubio’s visit is both symbolic and strategic.

“This is a reminder to the region that Washington remains its most vital economic and security partner,” said Collins Chong Yew Keat, a foreign affairs analyst at Universiti Malaya. “But the message now comes with more conditions.”

According to Chong, Trump’s administration wants ASEAN to stop “exploiting” America’s security guarantees while continuing deep economic engagement with China. That balancing act may no longer be tolerated under Washington’s renewed doctrine of strategic reciprocity.

A Region Navigating Uncertainty

As ASEAN moves toward a planned ASEAN-U.S. summit later this year, its ability to form a cohesive front on trade and diplomacy will be tested. Leaders face growing expectations to assert regional independence, even as external powers intensify efforts to pull Southeast Asia into their respective spheres of influence.

Prime Minister Anwar framed the stakes bluntly: “This is no passing storm. It is the new weather of our time.”

For ASEAN’s future relevance, the coming weeks may prove pivotal—not just in how it responds to the U.S. tariffs, but in how it defines its economic and geopolitical identity in an increasingly multipolar world.