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Front-loading by major Asian economies ahead of the US reciprocal tariffs has significantly altered global export patterns, according to a Nomura report.
The research highlights that several countries rushed shipments to the United States before higher duties came into effect in early August, leading to a sharp surge in export growth during the first half of the year. Nomura's analysis of trade flows across more than 20 major economies shows that Taiwan, Thailand, Vietnam, Indonesia, India, Malaysia and Singapore were among the biggest beneficiaries of this front-loading trend. Taiwan stood out with exceptionally strong growth, recording multiple months of double-digit and even triple-digit gains in export shipments to the US. The report noted that Taiwan's exports to the US jumped by over 80 per cent year-on-year in July alone, with the latest three-month average growth at a staggering 80.3 per cent. Similarly, Thailand and Vietnam saw robust gains in recent months, with their latest three-month average export growth at 36.2 per cent and 31.3 per cent respectively. Indonesia also recorded a strong pickup, averaging 26.6 per cent growth over the same period, while India posted a solid 20.1 per cent rise. Malaysia's exports surged during the second quarter, with April and May witnessing growth rates of 60.3 per cent and 54.4 per cent respectively before moderating. Singapore, though more volatile, also benefited from front-loading, posting a 41.4 per cent jump in March and strong gains in April and May. The Philippines, another Asian economy, registered a notable 35.2 per cent rise in May before softening later. The report pointed out that this pattern stands in stark contrast to China, whose exports to the US remained consistently negative despite a temporary tariff truce earlier this year. China's shipments fell sharply after May, with the latest readings showing a 24.1 per cent decline. Nomura noted that while front-loading helped many economies cushion the immediate impact of tariffs, the trend is likely to reverse in the coming months. "Countries with strong front-loading activities so far, most notably in Asia, could experience strong payback effects, and we have factored this into our downbeat economic outlook for Asia in H2" Outside Asia, Switzerland, Australia and the UK also recorded temporary spikes in export growth during the first quarter. Switzerland's exports to the US surged by more than 300 per cent in early 2025 before normalizing. However, these gains proved short-lived as growth rates turned negative later. The report concluded that the front-loading phenomenon underscores the volatility in global trade flows amid tariff uncertainty and shifting supply chains. As reciprocal tariffs take full effect, exporters may face significant headwinds in the months ahead. (ANI)
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