The Hollowing Out of East Asian Industry

SEOUL – In recent years, the pattern of trade and investment in East Asia, and the shape of global value chains more broadly, have fundamentally changed, primarily due to the United States’ embrace of tariffs. During his first presidency, Donald Trump imposed high tariffs on China, but largely left America’s other trading partners alone. This led East Asian firms, such as those in Japan and South Korea, to shift their supply chains away from China, toward Southeast Asia and Latin America, in addition to pursuing some reshoring. Former US President Joe Biden largely maintained Trump’s tariffs on China and introduced…