Trump strikes deals on trade, critical minerals in South-east Asia
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US President Donald Trump signed reciprocal trade deals with his Malaysian and Cambodian counterparts.
PHOTO: REUTERS
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KUALA LUMPUR – The United States signed a flurry of deals on trade and critical minerals with four South-east Asian partners on Oct 26, looking to address trade imbalances and diversify supply chains amid tighter export curbs on rare earths by China.
US President Donald Trump, who is in Kuala Lumpur to attend the Asean summit, signed reciprocal trade deals with his Malaysian and Cambodian counterparts, as well as a framework trade pact with Thailand that will see the countries work to address tariff and non-tariff barriers.
The US will maintain a tariff rate of 19 per cent on exports from all three countries under the deals, with the tariff to be reduced to zero for some goods, according to joint statements released by the White House.
Washington also announced a similar framework deal with Vietnam, which has been levied with a tariff rate of 20 per cent on its exports to the US.
Vietnam, which recorded a trade surplus of US$123 billion (S$160 billion) with the US in 2024, has pledged to vastly boost its purchases of US products to reduce the trade gap.
Malaysia not banning rare earths exports to US
Mr Trump on Oct 26 inked two separate US deals with Thailand and Malaysia seeking cooperation to diversify critical minerals supply chains, amid competing efforts from Beijing in the rapidly growing sector.
Reuters reported exclusively in October that China was in talks with Malaysia on rare earths processing
China, the world’s top miner and processor of rare earths, has imposed increasingly stringent export controls on its refining technology
Malaysia agreed on Oct 26 to refrain from banning or imposing quotas on exports to the US of critical minerals or rare earth elements, the countries said in a statement.
The statement, however, did not specify whether the pledge applied to raw or processed rare earths.
Malaysia, which has an estimated 16.1 million tonnes of rare earth deposits, has banned the export of raw rare earths to prevent the loss of resources as it looks to develop its downstream sector.
Eliminating tariff barriers
The agreements were inked after Mr Trump oversaw the signing of an enhanced ceasefire agreement between Thailand and Cambodia, following deadly border clashes between the neighbours earlier in 2025.
Under the deals, the four South-east Asian countries pledged to remove trade barriers and provide preferential market access for various US goods.
The deals also include commitments in digital trade, services and investments, as well as promises by the South-east Asian countries to protect labour rights and strengthen environmental protections.
Thailand, Malaysia and Vietnam further agreed to accept vehicles built to US motor vehicle safety and emissions standards, according to the statements.
Malaysia, a majority Muslim country recognised as a global leader in halal certification, agreed to streamline requirements for US products such as cosmetics and pharmaceuticals.
Investment, Trade and Industry Minister Tengku Zafrul Aziz told reporters that Malaysia had also secured tariff exemptions for aerospace equipment and pharmaceutical products, as well as commodities such as palm oil, cacao and rubber.
Thailand said it would eliminate tariff barriers on approximately 99 per cent of goods, and relax foreign ownership restrictions for US investment in its telecommunications sector, both countries said in a statement.
They also took note of several forthcoming commercial deals between Thai and US companies, including the purchases of agriculture products such as feed corn and soya bean meal worth an estimated US$2.6 billion per year.
Thailand has also committed to purchases of 80 US aircraft totalling US$18.8 billion, and energy goods including liquefied natural gas and crude oil of around US$5.4 billion annually, the statement said. REUTERS
