The Trump China trade war continues as the US President said on Sunday that there might be an increase in tariffs on Chinese goods worth billions of dollars in addition to new taxes on more goods worth billions. This calculated move will not only impact China’s economy but other Southeast Asian countries as well. Also, it may put this week’s US-China trade talks in jeopardy.

The new tariffs that target almost all Chinese exports come right after the Beijing trade delegation’s arrival in Washington, reports The Strait Times. The media report said that the newly imposed tariffs might persuade China to pull out of the trade talks for good.

As it turns out, the potential effect of the new tariffs on other Southeast Asian countries is no surprise. Investors have been closely watching the trade war between the two countries, questioning whether it will be entirely negative for the Asian markets.

In contrast to several pessimistic views, Virginie Maisonneuve, CIO of Eastspring Investments, the Asian asset management arm of Prudential, said that there could be a ‘redistribution of trade and investment activities’ across the region. This might largely benefit the technology markets in Korea and Taiwan, and the manufacturing companies in Malaysia and Vietnam.

But that’s not all. With the Trump China trade war, The first State of Southeast Asia: 2019 Report by the Singapore-based research centre  ISEAS-Yusof Ishak Institute in its survey found an optimistic impact on most countries.

The survey was carried out on more than 1,000 experts, analysts, and business leaders. According to the Report, 55 percent of the respondents said the majority of Southeast Asia would experience moderate to strong growth in 2019. However, 20 percent of the respondents anticipated an ‘economic downturn’, mainly in Malaysia, Singapore, and Thailand.

Lead researcher at the Institute Termsak Chalermpalanupap said, the forecast could be attributed to the expanding Asian trade encouraged by China. “There has also been strong intra-Asean trade and investment under the evolving Asean Economic Community. This creates optimism. Strong tourism in the Asean region is another big plus to most Southeast Asian economies”