Why the ‘Trump trade’ has Asia in a panic

TOKYO — Suffice to say, 2024 hasn’t turned out the way Japanese Prime Minister Fumio Kishida expected.

Rather than being a standout in Asia, Japan’s economy is skirting recession. The Bank of Japan still hasn’t hiked interest rates, though Tokyo had fully expected a tightening move or two by now.

Instead of coasting to victory in September’s Liberal Democratic Party election, Kishida’s approval rating is stuck in the low 20s. Deflation-plagued China is acting more of a drag on than growth engine for Asia.

Yet the biggest blow to all Kishida thought he knew about 2024 is coming from Washington.

First came ally Joe Biden’s disastrous June 27 presidential debate with Donald Trump. Then, Biden’s decision not to run for re-election, leaving Tokyo to wonder which of its diplomats might have Kamala Harris’s phone number.

China, South Korea and Taiwan are also experiencing geopolitical whiplash as the odds of a Trump 2.0 White House increase and cloud the North Asian economic outlook.

In Beijing, Xi Jinping’s government suddenly sees the risk of 60% across-the-board tariffs as a clear and present danger as Trump’s electoral chances rise to once-unthinkable levels.

Worries about slowing growth prompted the People’s Bank of China to announce a surprise rate cut Thursday (July 25). The PBOC cut the medium-term lending facility by 20 basis points to 2.3%.

In Seoul, President Yoon Suk-yeol’s embattled administration is suddenly gaming out losses as Trump looks to make trade wars great again. South Korean officials also must devise contingency plans for Trump deepening his bizarre bromance with Kim Jong Un’s murderous regime.

Taiwan, meanwhile, senses a big bullseye on its economy. Recently, Trump accused Taipei of stealing America’s