Ask Onix
Supreme Court ruling upends Trump's tariff strategy
Asian exporters and manufacturers are facing heightened uncertainty after the US Supreme Court invalidated a key legal basis for President Donald Trump's tariff regime last week, disrupting years of market planning.
New tariffs, same confusion
The court's decision struck down the emergency powers law Trump used to impose billions in levies. Within hours, he signed an executive order introducing a 10% global tariff under alternative legislation, threatening to raise it to 15% days later. By Tuesday, official documents confirmed the 10% rate remained in effect, with no clarity on future adjustments.
Trump's State of the Union address offered little reassurance, reiterating criticism of the ruling but providing no details on long-term plans. US Trade Representative Jamieson Greer later announced a 15% increase would follow "where appropriate," without specifying affected countries.
"The ruling only adds to the uncertainty. These new tariffs are a stop-gap while Washington prepares fresh measures."
Monica Gorman, former White House trade official
Supply chains in limbo
Businesses across Asia are delaying investments as shifting policies create unpredictable costs. Dan Ives of Wedbush Securities noted that companies embedded in regional production networks now face critical decisions without clear guidance from Washington.
"Should we move supply chains from one country to another without knowing the rules of the game? Welcome to navigating tariffs in 2026," Ives wrote in a briefing note.
For Singapore-based wellness brand Haldy, the volatility forced a halt to US market expansion plans. Founder Push Sharma described years of preparation-trademark registrations, distributor negotiations-suddenly shelved due to the "drastic" policy shifts.
Rising costs, shrinking orders
Thailand's Lanna Clothing, a garment exporter, saw clients cancel or renegotiate orders after Trump's initial tariff announcements in April 2025. General manager Tomi Mäkelä said the uncertainty made pricing impossible: "I can't eat the cost forever. So I need to increase prices."
Singapore skincare brand Handmade Heroes similarly reported a shift from pricing strategies to efficiency and diversification. Lynsey Lim, its founder, said the focus is now on reducing reliance on the US market.
"Early feedback suggests that uncertainty-rather than the headline tariff rate-is the bigger drag on business confidence. Businesses can plan for a known cost increase, but they struggle when the target keeps moving."
Kok Ping Soon, CEO, Singapore Business Federation
Logistics and legal headaches
DHL warned of a "more complex operating environment" as the Supreme Court ruling left some duties in place while halting others. Niki Frank, CEO of DHL Global Forwarding Asia-Pacific, said it was too early to assess potential refunds or shipping volume impacts, noting that supply chain adjustments require years of planning.
FedEx escalated the legal battle on Monday, filing a lawsuit to recover "full refunds" of Trump's emergency tariffs from US Customs and Border Protection.
China's enduring dominance
Despite efforts to reduce dependence on China, Asian businesses remain tethered to its manufacturing ecosystem. Tariffs tied to "country of origin" rules apply regardless of a company's headquarters, making it difficult to avoid Chinese supply chains.
Sharma's Haldy, for example, faces a 25% tariff on its China-produced turmeric mints and packaging. Chinese manufacturers are also raising prices for regional clients to offset lower US demand, further squeezing competitors.
"It's very hard to keep China out of play. They can do everything on a bigger scale... production costs for them will be even cheaper than for us here in Thailand."
Tomi Mäkelä, General Manager, Lanna Clothing
Markets and governments brace for more uncertainty
With Trump's late-March visit to China looming, analysts warn of further volatility. Reema Bhattacharya of Verisk Maplecroft noted that while Asian exporters may benefit from lower global tariffs, the legal pivot increases risks of targeted trade measures.
"The effects are now rippling back to Asia," Bhattacharya said. "Companies decide months in advance where to produce goods and which markets to prioritize-decisions made harder when tariff rules keep changing."
Facing persistent uncertainty, businesses are accelerating diversification efforts. Haldy has expanded into Malaysia and the Middle East, while Lanna Clothing is targeting Canada, Australia, and Europe. Governments and markets, however, can only prepare for more unpredictability ahead.
