New analysis released by ISI Markets, a global market intelligence provider, shows that the Association of Southeast Asian Nations (ASEAN) has rapidly taken center stage as the primary route for global trade flows seeking alternatives to traditional channels. The data strongly indicates that major economies, notably China, are actively engaging in supply chain reconfiguration, cementing ASEAN’s role as the definitive “connector economy”.
Despite its scale, ASEAN has long posed analytical challenges due to the fragmented nature of its data, spanning ten economies with differing languages, currencies, and statistical systems.
Key themes:
- Foreign direct investment (FDI) Flow Acceleration: Current trade analysis confirms Thailand, Malaysia, and Indonesia are now established as the primary hubs for rerouted manufacturing capital (FDI), showing the most notable shifts in import trends globally following the start of diversification efforts in 2017.
- Active trade bridging: ASEAN actively functions as the essential processing hub, demonstrated by the strong positive correlation between China’s exports to ASEAN and US imports from ASEAN since 2018, a quantifiable link that continues to maintain global supply chain continuity.
- Trade upgrading: Vietnam’s expanding trade surplus with the US coinciding with a widening trade deficit with China demonstrates the classic pattern of trade diversion. This is reinforced by the rapid increase in China’s import dependency on Vietnam for electrical equipment
- Future manufacturing hub: Thailand is accelerating its structural pivot, evidenced by the growth of domestic Electric Vehicle (EV) production capacity from 1% to 7% in just eighteen months, underlining ASEAN’s role in next-generation manufacturing.
Feopolitical and tariff pressures are driving a strategic pivot, compelling global companies to establish resilient trade channels outside of existing bilateral routes. Accumulated direct investment abroad by China since 2017 correlates with significant shifts in import trends across key ASEAN markets and has only intensified throughout 2025. Specifically, Thailand, Malaysia, and Indonesia, alongside Mexico are experiencing the most notable trend changes, indicating they are now crucial recipients of manufacturing and capital flows aimed at diversification.
“The global supply chain has not simply fractured; it is actively rerouting, and ASEAN is the pivotal switching mechanism,” said Steve Pulley, CEO of ISI Markets, in a statement. “Leveraging ASEAN’s scale and trade frameworks is a strategic imperative to ensure continued access to global markets. For investors, this translates into secular growth opportunities across the region’s manufacturing, digital, and energy sectors.”
The insights come from ISI Markets newly launched CEIC ASEAN Premium database, which addresses the data gap by providing a unified, high-frequency, subnational database that integrates official, local-language, and alternative data sources.