This report does not constitute a rating action. Asia-Pacific is at the nexus of global trade. Its significant intra-region trade is built on the region's complex and tightly intertwined supply chains. Tariffs and trade uncertainty are prompting buyers and sellers in the region to revisit their supply and production chains. S&P Global Ratings believes the reshuffling of these linkages will take time and could be costly. In our view, three sectors are notably sensitive to the uncertain tariff situation and geopolitical tensions: auto, chips, and rice. We also see some currencies as more prone to foreign-exchange volatility –including to appreciation that weakens exports competitiveness. This and substantial trade exposures between the U.S. and China may elevate vulnerabilities. Over half of
