Trade flows from North and East Asia to the Asean and South Asia regions rose by 44% between 2019 and 2024.

A report from Citi noted that trade corridors in Asia are experiencing “significant growth” in recent times, with Asean emerging as a major beneficiary. 

Both China and the US of late rely on a broader set of partners in trade – though transhipments may obscure underlying dependencies, said the analysts. 

The report surveyed 800 supply chain finance suppliers. Among the respondents, 75 per cent experienced “moderate or no noticeable effect” from US President Donald Trump’s tariffs, while only 20 per cent cited “significant negative impacts”.

In particular, analysts from Citi said that the tariffs have failed to prevent China from increasing its goods trade surplus – the Asian superpower recorded a surplus of over US$1 trillion within the first 11 months of 2025.

While Chinese exports to the US have fallen sharply since the tariffs, exports to South-east Asia are currently growing at nearly double the pace of the past four years.

Noticeably, China’s exports to the Asean and South Asia regions surged by 57 per cent between 2019 and 2024 as well, based on Citi’s data. 

“Chinese parent companies have significantly increased their subsidiary presence in Asean and South Asia, with the number of active subsidiaries growing steadily between the first quarter of 2022 and Q1 of 2025,” said the analysts. 

They added that regions with the highest export growth to the US – Asean and South Asia (up 51 per cent), and Latin America (up 40 per cent) – are also the same regions to which China has been exporting more in recent years. 

“This strongly suggests that supply chains are being rerouted through intermediary countries – often with more favourable trade terms with the US – to facilitate continued Chinese exports,” the Citi analysts wrote. 

“Many experts believe a significant share of these goods are ultimately re-exported, often to the US,” the analysts wrote. 

They added that this realignment was already taking shape between 2019 and 2024, even before Trump’s tariffs in 2025. 

For example, trade flows from North and East Asia (including China) to Asean and South Asia regions rose by 44 per cent during this period – marking a shift towards emerging markets. 

Comparatively, flows from North and East Asia into the US rose more modestly at 32 per cent, indicating a diversification of China’s customer base and a repositioning within global supply networks.