In two recent Business Times (BT) articles, Professor Johan Sulaeman, Director of SGFIN, commented on the effects of US punishing tariffs on Southeast Asian manufacturers in the renewable energy sector.
In a BT article titled “Greater ASEAN integration could prevent tariff-induced slowdown in energy transition: observers”, Professor Johan Sulaeman discussed the impact of U.S. tariffs on electric vehicle (EV) supply chain exports from Malaysia and Thailand. He noted that while these exports face lower duties compared to solar products, the tariffs still affect the countries’ ability to remain significant players in the EV supply chain. However, he pointed out that EV-related exports from these countries maintain a competitive advantage in the U.S. market compared to those from China, whose EV exports constitute only a small fraction of the U.S. market despite being the world’s largest EV exporter.
Complementing these observations, another BT article titled “US punishing tariffs put South-east Asian solar exporters in China-plus-one strategy bind” featured Professor Johan Sulaeman’s comments on the broader implications of the U.S. tariffs on Southeast Asian solar exporters. He explained that these tariffs disrupt the “China-plus-one” strategy, where companies diversify manufacturing beyond China to Southeast Asia. The tariffs undermine this strategy by targeting Southeast Asian countries, thereby affecting their role in global supply chains.
Overall, Professor Johan Sulaeman emphasized that while Southeast Asian countries have benefited from supply chain diversification strategies, the imposition of U.S. tariffs poses significant challenges to their clean energy export sectors, particularly in solar and EV industries.