QI Group executive chairman calls for operational integration as member states pursue separate deals with Washington
Donald Trump’s renewed tariff offensive has forced ASEAN into a defining moment, exposing fractures in regional solidarity while also creating the conditions for long-term transformation. Business leader Vijay Eswaran argues that the bloc’s response to the 2025 trade shocks will determine whether Southeast Asia consolidates into a unified economic power or remains a patchwork of competing national agendas.
“The 2025 tariff shockwaves present ASEAN with its gravest unity test since the 1997 financial crisis and its greatest underlying opportunity,” Eswaran writes in Singapore Business Review. His analysis describes how Trump’s “Liberation Day” tariffs triggered an every-state-for-itself race, with member nations seeking separate arrangements with Washington instead of a coordinated position.
That fragmentation, he contends, reveals ASEAN’s structural vulnerability. Unlike the European Union, which grants supranational authority to enforce common policy, ASEAN operates by consensus and non-interference. These founding principles, designed to protect sovereignty, have become liabilities in a moment that demands coordinated action.
Singapore illustrates the stakes. Growth projections for 2025 hover between 1.5 and 2.5 percent, yet the city-state’s export-dependent economy remains highly exposed to tariff uncertainty. Supply chains, trade flows, and financial services are all affected by the shift away from predictable multilateral frameworks. For Singapore, ASEAN’s cohesion is not an abstract diplomatic goal but a direct national interest.
Vijay Eswaran’s Pragmatic Alternative to Dollar Replacement
Eswaran dismisses proposals for creating a new reserve currency as unrealistic in the face of U.S. financial dominance. The dollar still accounts for roughly 58 percent of global reserves, and American influence through systems such as SWIFT reinforces its central role. Efforts by BRICS nations to build alternatives, he notes, remain experimental rather than systemic.
Instead, Eswaran highlights ASEAN’s emerging Regional Payment Connectivity framework as a more practical path. Linked systems such as Singapore’s PayNow, Thailand’s PromptPay, Indonesia’s QRIS, and Malaysia’s DuitNow now enable instant cross-border payments in local currencies. These transactions bypass dollar intermediation without requiring an overhaul of the existing global financial system.
“ASEAN cannot afford to invest in grand currency replacement schemes,” Eswaran writes. “Building interoperable payment infrastructure delivers tangible benefits today while gradually reducing dollar dependence tomorrow.”
He views digital payments as one part of a broader integration strategy. Ongoing negotiations to upgrade the ASEAN Trade in Goods Agreement and to finalize the Digital Economy Framework Agreement would enhance supply chain resilience and strengthen the region’s projected $1.3 trillion digital economy. Together, these initiatives support balanced relationships with major powers while avoiding dependence on any single alliance.
Creating Mechanisms That Reward Unity
The 47th ASEAN Summit reaffirmed commitments to collective action, yet Eswaran warns that declarations alone will not suffice. True resilience, he says, requires structural incentives that make regional cooperation more profitable than unilateral action.
Completing ATIGA reforms, operationalizing the Digital Economy Framework, and extending payment connectivity into trade finance represent tangible next steps. More critically, ASEAN must develop institutional mechanisms that impose real costs on members who act alone while rewarding coordination across the bloc.
Current arrangements, Eswaran argues, make it individually rational but collectively damaging for members to pursue bilateral deals with Washington or Beijing. The recent tariff negotiations demonstrated how short-term gains for individual states eroded ASEAN’s ability to leverage its combined $3.6 trillion economy and 680 million consumers.
Vijay Eswaran frames the moment as a defining choice. ASEAN can remain “a loose grouping of convenience, susceptible to external pressure,” or evolve into “an integrated economic bloc capable of using collective bargaining power to shape global outcomes.” The crisis, he says, provides both the motivation and the means for that transformation.
“The question is not whether ASEAN can survive the current tariff crisis, but whether it can use this crisis to become what its founders envisioned: a unified regional power capable of shaping rather than merely reacting to external developments,” he writes.
Singapore’s role will be decisive. As both a financial hub and a member directly exposed to fragmentation, its leadership could either accelerate integration or risk diminished regional leverage. Economic pressures and shared vulnerabilities have aligned to make reform urgent, yet the window for decisive action remains narrow.
Whether ASEAN can capitalize on this moment will determine if 2025’s tariff crisis becomes the beginning of genuine unity or another reminder of its structural limits. Eswaran’s assessment concludes on a guardedly optimistic note: the architecture for transformation already exists, but it will only succeed if political will can match economic necessity.
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