Malaysia's prime minster has warned that global trade is being weaponised as south-east Asian leaders held annual talks amid the looming threat of US tariffs.
Concerns about US tariffs have jolted the Association of South-East Asian Nations (ASEAN), a 10-member bloc that includes some of the world's most trade-dependent economies.
Six ASEAN members are among the 14 countries that could see duties on their exports to the US skyrocket on August 1.
Launching the group's foreign ministers' meeting, Malaysian Prime Minister Anwar Ibrahim said the world is now witnessing an era where "power unsettles principle" and "tools once used to generate growth are now wielded to pressure, isolate and contain".
Without mentioning the US by name, he again urged ASEAN to work together to respond to trade threats.
"Our cohesion must not end at declarations," he said, calling for members to increase intra-ASEAN trade, invest in regional integration, and reduce strategic dependencies on external powers.
"This is no passing storm," he said. "It is the new weather of our time."
US President Donald Trump first announced tariffs in April, but then delayed them for 90 days to allow for deals to be negotiated.
On Tuesday, he announced new tariffs with rates of between 25-40 per cent on 14 countries, which will go into effect next month unless new deals are struck.
He also threatened to increase tariffs if any countries retaliate.
[TABLE OF NEW RATES]Many ASEAN members have launched bilateral talks with the US, but officials have said they plan to hold an ASEAN-US summit later this year to seek a common position.
So far, only Vietnam has secured a deal, bringing down its tariffs from 46 per cent to 20 per cent.
Reacting to the economic headwinds, Malaysia's central bank on Wednesday cut its benchmark interest rate for the first time in five years.
Countries continue to push for tariff deals
Separately, Trade Minister Zafrul Aziz said Malaysia will continue tariff talks with the US but would not compromise on issues impacting national interest and sovereignty.
He referred to US requests on policy and laws in areas such as government procurement, halal certification, medical standards and digital tax, without giving details.
"It has to be fair … if the deal does not benefit Malaysia, we should not have a deal," he said.
South Korea, that faces a 25 per cent levy from next month, said it will follow previously agreed terms with the US on defence.
Mr Trump had criticised Seoul for not paying enough for US troops in the country, with some 28,500 American troops stationed in the country to deter nuclear-armed North Korea.
The countries struck a five-year plan last year on sharing the cost of the US troops stationed in the country.
South Korea's top security adviser, Wi Sung-lac, said on Wednesday that he had suggested to the US that they advance discussions on a "package" of issues including "trade, investment, purchases and security" during his visit to Washington this week.
Mr Wi told a press briefing that US Secretary of State Marco Rubio agreed.
"It's a fact that we pay 1.5 trillion won (annually) in defence costs … Discussions should start from this fact," Mr Wi told reporters, according to Yonhap.
"Additionally, there are many direct and indirect defence support costs, and we are also trying to increase them in line with the international trend," he said, adding that defence costs were not discussed much during this week's visit.
Meanwhile, Thailand Airways CEO has said the company could buy more Boeing planes from the US as part of a possible deal with the Trump administration.
The company's CEO Chai Eamsiri made the remarks at a Reuters news agency summit, echoing those made by the country's finance minister at the weekend.
The flag carrier last year ordered 45 Boeing 787-9 jets, with an option for another 35.
Bloc facing other major challenges
In addition to confronting trade fallout, the ASEAN bloc faces mounting internal challenges including the ongoing civil war in Myanmar and a border dispute between Thailand and Cambodia.
The gathering in Malaysia will be immediately followed by a series of critical meetings with ASEAN's major trade partners, including the US, China, Japan, Russia, India, and the European Union, scheduled for Thursday and Friday.
Mr Rubio, who last week cancelled trips to Japan and South Korea, will arrive on Thursday for the talks on his first visit to Asia.
Others visiting foreign ministers include China's Wang Yi and Sergei Lavrov of Russia.
Analysts said these talks will test ASEAN's ability to assert its voice amid escalating geopolitical tensions.
The bloc hopes to reinforce its commitment to a rules-based trade order while resisting pressure to align exclusively with any one global power.
"ASEAN must be among those who choose to stand for rules, even when others choose retreat," Mr Anwar said. Officials said the premier will meet Rubio to discuss the tariff issue.
Analysts said Mr Rubio's presence signalled renewed US engagement in the region.
It will be a reminder to "the region that Washington remains its most vital economic and security partner," said Collins Chong Yew Keat, a foreign affairs, strategy and security analyst with Universiti Malaya. But he said that US support may now come with clearer expectations.
"Trump's administration, while still offering the strongest military deterrence and market access, expects ASEAN to stop exploiting this security umbrella while cosying up economically to China," he said.
AP/Reuters
