The recent decision by the United States to impose reciprocal tariffs ranging from 10% to nearly 50% on The Association of Southeast Asian Nations (ASEAN) exports has sent ripples through global trade. Countries like Cambodia, Lao PDR, and Viet Nam have been hit particularly hard, revealing just how vulnerable economies can be when they rely too heavily on a single export market.
For the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), this situation offers a timely reminder of the importance of diversifying trade and building regional resilience.
Under Malaysia’s 2025 chairmanship, ASEAN has responded with a coordinated and forward-looking strategy. The bloc is working to boost intra-ASEAN trade, deepen financial integration, and expand partnerships beyond traditional markets. Efforts are underway to strengthen ties with the Gulf Cooperation Council (GCC) and the European Union, while also enhancing existing trade relationships with China, India, and Japan.
BIMSTEC could draw inspiration from this approach, tailoring it to the region’s unique economic and political landscape. Exploring underutilized markets in Africa, Central Asia, and Latin America could help BIMSTEC countries reduce their dependence on a few key partners and build more balanced trade portfolios.
A major part of ASEAN’s strategy involves harmonizing regulations, lowering tariffs, liberalizing services, and pushing forward digital integration, especially through the upcoming ASEAN Digital Economy Framework Agreement (DEFA). These steps are designed to strengthen the region’s collective economic capacity and reduce vulnerability to external shocks.
BIMSTEC, with its shared geography and cultural connections, is well-positioned to follow a similar path. Improving regional connectivity, streamlining customs procedures, and investing in cross-border infrastructure could significantly boost trade within the bloc.
ASEAN’s shift toward services and digital trade also offers valuable lessons. While many ASEAN economies are driven by the services sector, their external trade still leans heavily on goods. BIMSTEC countries, especially those with growing IT and service industries, could benefit from developing a regional digital economy framework. This would support cross-border e-commerce, digital payments, and help micro, small, and medium enterprises (MSMEs) integrate into global value chains.
Rather than viewing the U.S. tariffs as a setback, this moment could serve as a turning point for rethinking trade priorities and strengthening regional ties. ASEAN’s experience provides a practical and adaptable roadmap for BIMSTEC.
As both ASEAN and BIMSTEC navigate the economic turbulence triggered by these tariffs, the role of regional and international institutions becomes even more critical. The Economic and Social Commission for Asia and the Pacific (ESCAP), with its presence in both South and Southeast Asia, is uniquely positioned to support both regions in building economic resilience and advancing sustainable trade strategies.
ESCAP can play a vital role by bringing countries together for dialogue, helping align policy responses, and offering hands-on support through training, research, and technical expertise. Through regional studies and trade impact assessments, ESCAP can help ASEAN and BIMSTEC identify new economic frontiers, address supply chain vulnerabilities, and harness the potential of digital trade.
Moreover, ESCAP’s commitment to inclusive and sustainable development makes it a valuable partner in helping BIMSTEC adapt ASEAN’s best practices while tailoring solutions to the subregion’s specific needs.
