US tariffs to hit Asia-Pacific growth, says S&P

Asia-Pacific Growth at Risk The Impact of US Tariffs on Credit Conditions

As the United States continues to implement its tariff policies, the Asia-Pacific region is bracing itself for a potential impact on growth and credit conditions. According to S&P Global Ratings, the effects of these tariffs may be felt in the coming months as the boost from strong first-half growth begins to recede.

In their September 24 report, S&P noted that Asia-Pacific's credit conditions have been steady thus far, thanks to supportive financing conditions and robust economic growth in the first half of the year. However, this stability may be short-lived if US tariffs continue to take a toll on regional economies.

For startup founders looking to succeed in 2025, it is essential to understand the impact of US tariffs on Asia-Pacific growth and credit conditions. In this blog post, we will explore the implications of these tariffs on the region's economy and offer insights on how entrepreneurs can navigate these challenges to achieve success.

The Double-Edged Sword of Tariffs

On one hand, US tariffs have created a surge in demand for Asian goods, particularly in electronics and manufacturing. This has led to a boost in exports, which in turn has supported economic growth in countries like China, Japan, and South Korea. However, this surge is not without its drawbacks.

As the tariff-induced demand continues to drive up prices, it also increases costs for Asian businesses, making it more challenging for them to maintain profitability. This could lead to a slowdown in production and investment, ultimately affecting economic growth.

Credit Conditions A Key Indicator of Economic Health

S&P's report highlights the importance of credit conditions as an indicator of Asia-Pacific's economic health. The agency noted that while credit conditions have been stable thus far, they may become more challenging if US tariffs continue to bite.

In particular, S&P warned of potential risks to financial stability in countries with high levels of debt, such as China and Japan. As interest rates rise and borrowing costs increase, these countries may face difficulties servicing their debt, leading to a credit crunch.

Implications for Startup Founders

What does this mean for startup founders looking to succeed in 2025? Here are some key takeaways

1. Diversify Your Revenue Streams As US tariffs create uncertainty in Asian markets, it is essential to diversify your revenue streams and reduce dependence on any one market.
2. Focus on High-Growth Sectors Identify high-growth sectors that are less susceptible to tariff fluctuations, such as healthcare, fintech, or sustainable energy.
3. Develop a Global Strategy Develop a global strategy that takes into account the impact of US tariffs on different regions and markets.
4. Build Strong Relationships with Suppliers Build strong relationships with suppliers and manufacturers to mitigate the risks associated with tariff-induced price increases.

Conclusion

As US tariffs continue to shape the Asia-Pacific economy, startup founders must be prepared to adapt and evolve their strategies to succeed in 2025. By diversifying revenue streams, focusing on high-growth sectors, developing a global strategy, and building strong relationships with suppliers, entrepreneurs can navigate these challenges and achieve success in an uncertain landscape.

Keywords US tariffs, Asia-Pacific economy, credit conditions, startup founders, entrepreneurship, innovation

Edward Lance Arellano Lorilla

CEO / Co-Founder

Enjoy the little things in life. For one day, you may look back and realize they were the big things. Many of life's failures are people who did not realize how close they were to success when they gave up.