Rising Imports from China in Southeast Asia

Chinese imports have dramatically increased in Southeast Asia, while China has decreased exports to the United States (US) and neighboring developed countries. General and electronic machinery industries are the major industries with rising imports from China. In particular, upstream product imports have increased faster. This study empirically investigates the factors that have induced increased imports of upstream machinery products from China in Southeast Asia. To do so, we examine quarterly imports from China across the five Southeast Asian countries spanning Q1 2023–Q1 2026. The relevant findings are as follows. First, we do not find significant transshipment of upstream machinery products from China to the US via Southeast Asian countries on average. Furthermore, China’s expanded supply capacity is not associated with increased Southeast Asian countries’ imports from China. In contrast, we find robust results of the positive association between upstream machinery product imports from China and downstream machinery product exports to the US from Southeast Asian countries.