Asia Economist, Founder, Asia Decoded

Priyanka Kishore

Asia Economist, Founder

Asia Decoded

Independent, data-centric insights that help you stay on top of Asia's economics and geopolitics.

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Macroeconomics

<ul>
<li>Asia defied US tariffs to grow at a faster pace in 2025 than 2024.</li>
<li>But the tech-led growth spurt masks internal fault lines of sluggish domestic demand and a weakening manufacturing sector.</li>
<li>The growing divergence between tech‑dependent sectors and the rest of the economy will require careful policy calibration going forward, even as Chinese competition, US protectionism and geopolitical challenges persist.</li>
</ul>


Asia defied US tariffs to grow at a faster pace in 2025 than 2024.
But the tech-led growth spurt masks internal fault lines of sluggish domestic demand and a weakening manufacturing sector.
The growing divergence between tech‑dependent sectors and the rest of the economy will require careful policy calibration going forward, even as Chinese competition, US protectionism and geopolitical challenges persist.


<ul>
<li>As the US retreats from rules-based trade under Trump 2.0, China and ASEAN’s commitment to an upgraded ASEAN-China FTA (ACFTA 3.0) underscores their support for openness.</li>
<li>While ASEAN’s integration with China has boosted trade and investment, import surges of low-cost products are squeezing ASEAN’s manufacturers and heightening dependence on Chinese capital is raising geopolitical risks.</li>
<li>ACFTA 3.0 could deepen digital and services linkages, but its economic pay-off for ASEAN hinges on technology transfer, local supply-chain integration, and balanced FDI.</li>
</ul>


As the US retreats from rules-based trade under Trump 2.0, China and ASEAN’s commitment to an upgraded ASEAN-China FTA (ACFTA 3.0) underscores their support for openness.
While ASEAN’s integration with China has boosted trade and investment, import surges of low-cost products are squeezing ASEAN’s manufacturers and heightening dependence on Chinese capital is raising geopolitical risks.
ACFTA 3.0 could deepen digital and services linkages, but its economic pay-off for ASEAN hinges on technology transfer, local supply-chain integration, and balanced FDI.


ACFTA 3.0: Greater Integration Likely, but Who Benefits?

<ul>
<li>The exit of Indonesia's veteran Finance Minister, Sri Mulyani Indrawati, marks a turning point in the country's fiscal regime.</li>
<li>With her out of the picture, it is only a matter of time before the government revises the 3% deficit ceiling higher to accommodate Prabowo's large spending plans.</li>
<li>This is a slippery slope and an indiscriminate push for spending, without concomitant tax reforms, could put debt on an unsustainable path.</li>
</ul>


The exit of Indonesia's veteran Finance Minister, Sri Mulyani Indrawati, marks a turning point in the country's fiscal regime.
With her out of the picture, it is only a matter of time before the government revises the 3% deficit ceiling higher to accommodate Prabowo's large spending plans.
This is a slippery slope and an indiscriminate push for spending, without concomitant tax reforms, could put debt on an unsustainable path.


Indonesia : Sri Mulyani's Exit Compounds Fiscal Risks

<ul>
<li>The US’s broadening protectionist arsenal against India creates substantial headwinds for the country’s economic outlook. </li>
<li>The H-1B visa fee hike has limited impact. But it does raise concerns of future curbs on US offshoring, and follows the steep tariffs on India's goods imposed last month.</li>
<li>A tactical truce with the Trump administration would allow India to prioritise its reform agenda with fewer external distractions.</li>
</ul>


The US’s broadening protectionist arsenal against India creates substantial headwinds for the country’s economic outlook. 
The H-1B visa fee hike has limited impact. But it does raise concerns of future curbs on US offshoring, and follows the steep tariffs on India's goods imposed last month.
A tactical truce with the Trump administration would allow India to prioritise its reform agenda with fewer external distractions.


India : The Rising Costs of US Protectionism

<ul>
<li>Trump offers another three weeks of reprieve on reciprocal tariffs with an extension of the deadline to 1 Aug from 9 July</li>
<li>Tariffs remain cumbersome for Asia despite some reductions. Japan and Malaysia see 1ppt increase.</li>
<li>Ongoing development reinforce our core views of a slowdown in H2 and more monetary easing. However, relative forecasts are subject to re-evaluation.</li>
</ul>


Trump offers another three weeks of reprieve on reciprocal tariffs with an extension of the deadline to 1 Aug from 9 July
Tariffs remain cumbersome for Asia despite some reductions. Japan and Malaysia see 1ppt increase.
Ongoing development reinforce our core views of a slowdown in H2 and more monetary easing. However, relative forecasts are subject to re-evaluation.


Tariff Update - Asia Remains in Trump's Crosshairs

Experienced economist with two decades of expertise in analysing macro-economic and policy trends across Asia. Founder of Asia Decoded, a macro consultancy providing advisory services to policy makers, think tanks, corporates and institutional investors. Prior to that Chief India and SEA Economist for Oxford Economics and senior economist and strategist in the banking sector.

Available for bespoke research, presentations and speaking engagements.

Priyanka Kishore
Asia Economist, Founder
• Asia Decoded

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Asia's strong growth performance masks internal fault lines of sluggish domestic demand and a weakening manufacturing sector.

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​Indonesia's fiscal regime faces uncertainty as veteran Finance Minister exits, potentially leading to higher deficit ceiling and unsustainable...

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​US protectionist measures against India, including H-1B visa fee hikes and tariffs, pose economic challenges. A truce with the Trump...

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​Trump extends deadline for reciprocal tariffs, but tariffs still a burden for Asia. Economic slowdown in H2 expected, with potential for more...

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Indonesia's fiscal regime faces uncertainty as veteran Finance Minister exits, potentially leading to higher deficit ceiling and unsustainable...

US protectionist measures against India, including H-1B visa fee hikes and tariffs, pose economic challenges. A truce with the Trump...

Trump extends deadline for reciprocal tariffs, but tariffs still a burden for Asia. Economic slowdown in H2 expected, with potential for more...