A series of new bilateral trade agreements between the United States and several Asia-Pacific (APAC) nations are expected to reduce uncertainty for regional exporters and provide a mild lift to economic growth over the coming years, according to Fitch Ratings.
The US-based rating agency noted that while India has yet to secure a formal trade pact with the US, its average import tariff of around 50% remains substantially higher than those of most Asian economies. Fitch added that a deal between the two countries could still materialize in the near future.
“The recent wave of bilateral trade agreements between the US and APAC countries reduces uncertainty for exporters and could marginally strengthen GDP growth in the coming years,” Fitch said. However, it cautioned that many elements of the agreements remain undefined, and tariff adjustments could still evolve.
Between October 20 and 30, the US signed trade deals with China, Japan, South Korea, Vietnam, Malaysia, Thailand, Australia, and Cambodia. Among these, the most significant impact is expected from Washington’s decision to halve its 20% fentanyl-related tariff on Chinese goods—effectively cutting the overall US tariff rate on China by about 10 percentage points.
Fitch also reported that the US and China have agreed to suspend for one year their recent escalation of trade restrictions, including China’s curbs on rare earth exports and the US’s expanded export licensing rules targeting companies with links to restricted entities.
“These developments should have a modest positive effect on economic growth in both China and the US during 2026–2027,” Fitch said. “Other Asian economies—particularly South Korea and Vietnam—may also benefit indirectly through stronger demand from the world’s two largest economies, although the direct gains will likely remain limited.”
Despite the easing measures, US tariffs on Chinese imports remain considerably higher than those applied to most other trading partners. Nonetheless, Fitch noted that clearer tariff expectations will help exporters plan medium- to long-term supply chain adjustments with greater confidence—supporting investment growth in key export-driven economies such as Malaysia, Thailand, and Vietnam.
The agency added that the new trade agreements signal Washington’s commitment to diversifying supply chains and expanding rare earth mining outside China. This could spur fresh investment in Southeast Asia and Australia, although the broader economic impact is expected to remain modest over the short term.
