ASEAN Emerges as Middleman in US–China Tech Trade

Trelysa Long (ITIF) reports that U.S. trade policy shifts and tariffs have redirected high-tech manufacturing and final assembly away from direct U.S.-China trade toward Southeast Asia, with Vietnam playing a major intermediary role.

• Main finding: Over the past year U.S. trade policy toward China altered global trade patterns, with the U.S. trade deficit staying near $1.2 trillion in 2025 and China’s global trade surplus rising to roughly $1.2 trillion; companies including Lenovo, Apple, Dell, and HP moved portions of manufacturing and final assembly to Southeast Asia to reduce exposure to U.S. tariffs on Chinese goods.
• Background and mechanics: The shift reflects tariff avoidance and supply-chain diversification: only 1 percent of tech goods under HS code 84 coming from ASEAN faced tariffs compared to about 90 percent for those from China, and Chinese firms continued to supply upstream components to ASEAN-based manufacturing; rising demand for servers, networking equipment, semiconductors, and data centers (AI infrastructure) also increased ASEAN’s role.