Southeast Asia plays an increasingly significant role on the global stage. Home to some of the world’s fastest-growing economies, it is a hub for manufacturing and supply chain diversification as companies seek alternatives to China. Industries such as electronics, semiconductors, automotive production, and electric vehicles are thriving.
However, all eyes are on the return of Donald Trump as US President and his “America First” policies, protectionist trade measures, and focus on US-China competition.
While economists expect Southeast Asia’s growth to be resilient at about 4.7%, the uncertain outlook means that companies will have to reinforce their businesses and brands. Amid escalating US-China tensions, shifting trade dynamics and evolving economic policies, well-formed communication strategies will be vital in helping tech players stand firm and build trust with stakeholders in the Trump 2.0 era.
Opportunities
There are numerous opportunities for technology players, but vigilance is crucial and communications teams need to be ready to take a position on external change. Companies will do well to capitalise on the positive aspects, such as:
1. Supply Chain Diversification (“China Plus One”)
The push for supply chain diversification presents a compelling opportunity for Southeast Asia, and this needs to be communicated globally. Countries like Vietnam, Indonesia, and the Philippines are already attracting investment from giants like Apple and Samsung. This trend could drive local tech ecosystems up the value chain, boosting exports of high-tech goods.
2. Tech Industry Growth
Southeast Asian companies can position themselves as neutral players in global supply chains, attracting partnerships from both US and Chinese businesses. The region’s focus on sustainability also creates demand for clean technologies, presenting opportunities for US enterprises to expand in Southeast Asia despite domestic policy challenges.
3. Regional Integration and Innovation
More needs to be communicated about how Southeast Asian nations are cooperating for the wider good and to leverage economies of scale and reduce dependency on external powers. ASEAN countries should convey how they are strengthening regional cooperation to enhance industrial capabilities, e.g. Singapore and Johor’s recent announcement on the creation of a special economic zone. This could accelerate the transition from low-cost manufacturing to advanced industries like AI and robotics.
4. Energy Collaboration Opportunities and Sustainability
Despite potential setbacks in clean energy funding, Southeast Asia’s abundant renewable energy resources and nuclear energy potential could attract investment in alternative energy projects. As the US prepares to exit the Paris Climate Agreement, other countries are still investing in green projects. Additionally, with closer board scrutiny on sustainable practices within organizations, there is much opportunity for companies to double down on articulating their sustainability strategies and practices.
Challenges
On the flip side, numerous challenges persist, and organizations would benefit from beefing up their issues and crisis communications protocols. PR teams must stay informed about market movements given the greater volatility of a Trump presidency. These include:
1. Trade Barriers and Tariffs
Trump’s proposed tariffs on global imports, including over 60% on Chinese goods, will indirectly impact Southeast Asian countries such as Vietnam, Malaysia, and Thailand. These nations, which export goods containing Chinese components to the U.S., face stricter scrutiny and potential penalties. Stricter monitoring of Chinese content in products routed through Southeast Asia will make it harder for companies to bypass US tariffs by relocating assembly lines to the region.
PR teams will have to keep a close eye on potential business impact and work closely with the relevant teams to ensure they are prepared not just for the media but for partners and their wider ecosystems that the tariffs may hit.
2. Heightened US-China Tech Rivalry
Southeast Asia’s dependence on both US and Chinese technologies puts the region in a precarious position. The region has valuable leverage in the global semiconductor space and wants to attract both American and Chinese companies to set up or expand operations. However, in a bid to undermine attempts by China to develop its own chip supply chain, recent US chip export controls are likely to also disrupt supply chains in Malaysia, Singapore and Vietnam. China, meanwhile, sees the region as a long-term play to wean itself off US chip dependency, and support a domestic semiconductor manufacturing industry. In courting US chip investments, Southeast Asia risks antagonizing China, the region’s major trading partner. Concurrently, overt attempts in the region to support China’s semiconductor aspirations risk attracting further US scrutiny and chip sanctions.
Increased scrutiny of Chinese investments in Southeast Asia’s tech infrastructure (e.g. digital platforms, EVs) may deter growth in these sectors. Trump has spoken repeatedly of reindustrializing the US as a national security priority. We can expect him to uphold Chips Act subsidies and grants, and to continue encouraging companies to shift manufacturing back to the US.
Comms teams will need to take note of their respective governments’ positions on US and Chinese foreign direct investments. Consider the extent to which your updates/announcements might be perceived in light of the escalating US-China rivalry in Southeast Asia. This is especially true if your company operates in key semiconductor and/or high-tech, value-added manufacturing supply chains.
If you’re advising key executives in leading or otherwise high visibility companies in these spaces, expect to receive increased media enquiries on impacts of the US-China rivalry on your business or industry.
3. Clean Energy and Tech Funding
Trump’s climate skepticism and potential withdrawal from initiatives like the Indo-Pacific Economic Framework could reduce US investment in clean energy technologies in Southeast Asia. This would particularly affect countries such as Thailand, which has longstanding ties with the US around renewable energy investment, and Vietnam, which is also a leading renewable energy adopter. Conversely, strict EU policies on carbon and emissions would be good for industries in Southeast Asia such as steelmaking if players are building products that comply with CBAM standards. Companies like Meranti Green Steel and Gunung Raja Paksi are making strides in this area.
4. BRICS Complications
The growing engagement of some Southeast Asian countries with BRICS may complicate their access to US technologies and investments. Although BRICS positions itself as a non-aligned group, its growing economic and political ties with China and Russia could be seen as a shift in influence, potentially impacting its relationships with the US and EU in the technology sector. Indonesia is one of the most recent Southeast Asian countries to officially join the BRICS, while Malaysia and Thailand have become ‘Partner States’.
Given these challenges, tech companies operating in Southeast Asia will need to factor the following actions into their communications strategy:
- Highlight the region’s resilience, growth potential, reliability and neutrality, while demonstrating flexibility and readiness to adapt to evolving trade dynamics
- Foster stronger relationships with local governments and industry bodies to align on policies and incentives
- Present success stories of regional innovation and collaboration to build goodwill with both US and Chinese stakeholders
- As always, tailor messaging to local markets, emphasizing the socioeconomic benefits of tech investments
- Communicate ESG and sustainability efforts authentically and transparently, using clear, credible, and consistent messaging to build trust and demonstrate progress
- Develop comprehensive crisis management plans to address potential disruptions, including heightened tariffs and geopolitical tensions.
- Last but by no means least, train leadership teams on effective media engagement to address sensitive topics.
Trump’s return to power does carry high uncertainty and risk for Southeast Asia’s technology industry, from trade barriers to geopolitical tensions. However, the region also has opportunities to strengthen its position through supply chain diversification, tech innovation, and sustainability initiatives. By adopting proactive strategies and robust communication plans, Southeast Asia can not only weather the storm but emerge as a more resilient and influential player in the global tech ecosystem.
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