ORLANDO, Florida, Feb 11 (Reuters): US President Donald Trump loves tariffs and big numbers, so it's no surprise that the first targets in his trade war have been economies that boast the biggest trade surpluses with the United States in dollar terms.
But if America's bilateral deficits are measured as a share of trading partners' economic output, or those that are widening rapidly, the countries with most to worry about are emerging economies in East Asia.
Many of them boast huge trade surpluses with the US relative to the size of their economies, and these chasms have grown substantially since Trump first put his protectionist 'America First' drive into gear eight years ago. Their growth, domestic investment and local markets are all at risk if Washington slaps heavy duties on exports to the US.
To add insult to injury, these countries are also likely to suffer significant collateral damage from a US-Sino trade war due to the increasingly close trade links forged with China since 2017.
Of the 15 countries that America runs the largest bilateral goods trade deficit with, nine are in Asia.
This is partly a result of the "China Plus One" strategy, which refers to US firms investing in countries with close economic ties to China rather than in China itself. This trend has intensified considerably since Trump's first term and the pandemic.
Emerging Asian countries' exports to the US as a share of their total exports have increased sharply in recent years to 18 per cent from 11 per cent.
At the same time, these countries' trade ties with China have also intensified, reflected by the fact that 45 per cent of emerging Asian nations' combined exports are now shipped to the US and China, according to economists at JP Morgan.
As a share of GDP, South Korea's trade surplus with the US is more than twice as big as China's, and Taiwan's is nearly 10 per cent of GDP.
Two countries that may be particularly vulnerable are Thailand and Vietnam. Since 2017, Thailand's trade gap with the US has widened by 343 per cent while Vietnam's has soared by 222 per cent, according to economists at Citi.
In fact, Thailand now boasts the fifth-largest trade surplus with the US, more than Japan or South Korea if European Union countries are grouped into one bloc. That's particularly remarkable given that Thailand's surplus with the US was only the 13th largest in 2017.
