Despite mounting calls for the deals to be renegotiated or scrapped, officials in both countries have defended their respective agreements with Washington.
Joanne Lin, senior fellow and coordinator of the ASEAN Studies Centre at the ISEAS–Yusof Ishak Institute in Singapore, said countries that have already signed reciprocal arrangements with the US — including Indonesia and Malaysia — are likely to preserve the deals to avoid falling foul of Trump.
“The US remains a key security partner, a technology leader and one of the largest sources of foreign direct investment into Southeast Asia. Preserving broader bilateral relations will remain a priority,” she told CNA.
Trump has threatened to impose more severe sanctions on countries that seek to “play games with the ridiculous Supreme Court decision”, signalling his intentions to governments that may be tempted to back away from tariff agreements already struck with Washington.
COMPETITIVENESS GAINED AND LOST
The court ruling effectively levels the playing field, boosting the competitiveness of most Southeast Asian economies.
Before the Supreme Court’s decision, the Trump administration had slapped a 48 per cent tariff on goods from Laos — the highest in the region at that time— citing suspicions of transshipment.
Transshipment refers to the practice of rerouting or repackaging goods from one country, typically China, to make them appear as though they originated elsewhere in order to circumvent US tariffs.
China was initially hit with a 57 per cent tariff, though Beijing later negotiated it down to 47 per cent — a rate that was, ironically, lower than that imposed on Laos.
However, the bigger beneficiaries of the court ruling are likely to be Vietnam and Thailand, two of the US’ largest trading partners in Southeast Asia.
According to data from the United Nations Commodity Trade Statistics Database (UN Comtrade), Vietnam — previously subject to a 20 per cent tariff — exported US$142 billion worth of goods to the US in 2024.
Thailand, which had faced a 19 per cent tariff, shipped US$66 billion that same year. By comparison, Laos exported US$849 million in 2024.
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