Jeffrey Lonsdale: Thuế quan của Hoa Kỳ như một chính sách, tính toán rủi ro Đài Loan và cơ hội chuỗi cung ứng của Đông Nam Á - E562
“So if the Trump administration only does tariffs, that's not going to be enough to increase the production inside the US, but if they figure out how to cut these various—and it's not just cutting the red tape where the red tape is completely useless—there's even scenarios where, yes, we want these environmental regulations. We don't want you dumping toxic chemicals into the river, but we're going to have you prove that you're doing this in a far more cheap and efficient way than you had to prove in the past. So you pay less lawyers, less consultants, and the project gets going much faster, which lowers the cost of capital of the project in total. And there's ways where hopefully that can result in a lot more manufacturing being done inside the US. And that's the positive scenario where the US industrial base is revitalized from a collection of these policies in total. And maybe the rest of the Western world as well also realizes that they need to pivot away from the dependency on China and that they also are able to do something similar in their economies.” - Jeffrey Lonsdale, Investor and Advisor
“I would just advise them not to panic as much about this as they seem to be panicking, and also to realize that there is far more of a method to what's coming out of the U.S. than people think. The Europeans are now scrambling to do exactly what the U.S. has been trying to get them to do for the last 10–15 years, which is actually spend more of their money on defense and take care of themselves. They're doing it because they're angry at Trump, but they're actually doing it now. And so people say, oh, it was a mess-up, like how he angered all those people. But he got exactly what—not just what Trump wants—but what the U.S. has always been trying to accomplish.” - Jeffrey Lonsdale, Investor and Advisor
“From the perspective of the US, one of the positive scenarios is that instead of actually trying to only use tariffs to fix this problem—tariffs are one part of the solution—they implement other aspects to make it easier to build in the US. You always look at these numbers where it costs more for the US to build roads, it takes almost twice as long for them to build new semiconductor plants compared to other places around the world, and there's all this red tape and regulation that needs to be cut through in order to allow people to build as quickly and as efficiently inside the US as they do outside the US.” - Jeffrey Lonsdale, Investor and Advisor
Jeremy Au sits down with Jeffrey Lonsdale to unpack the US-China trade standoff, the Taiwan flashpoint, and how Southeast Asia is adapting to global shifts. They explore how tariffs are reshaping supply chains, the risk of trade wars escalating, and the difficult position countries like Vietnam and Singapore now find themselves in. The conversation also looks ahead at how governments, investors, and founders should think about resilience in a volatile world.
1. Tariffs as a political and economic tool - Trump uses tariffs not only to protect US industries but as a form of domestic consumption tax, shifting behavior and revenue like a GST or VAT.
2. Escalation breeds popularity - Politicians in countries like Canada, Mexico, and parts of Europe gain domestic support by opposing Trump era tariffs, encouraging confrontational stances.
3. Two futures for the US economy - A positive outcome involves cutting red tape and reindustrializing; a negative one sees trade wars, inefficiency, and geopolitical instability, especially if China moves on Taiwan.
4. China-Taiwan conflict would ripple globally - Supply chains are tightly linked—any flashpoint could halt key components, expose Western dependency on Chinese manufacturing, and cripple downstream industries.
5. Southeast Asia’s mixed upside - Countries like Vietnam and Indonesia benefit from the “China plus one” shift, but they’re also at risk if rerouted exports from China trigger new US tariffs.
6. Neutrality may not last - Singapore’s attempt to stay neutral could break down in a Taiwan crisis; facilitating trade with China could be interpreted as taking sides.
7. Southeast Asia’s long-term growth hinges on reform - Vietnam and Indonesia need policy upgrades, power reliability, legal trustworthiness, and governance improvements to fully capitalize on global shifts and avoid investor skepticism after scandals like eFishery.
(00:54) Jeremy Au: Hey, good to see you! And now we're back in person. Yeah, it's good to be here. Oh, what an upgrade, I guess (01:00) from the way we did in the past where I think a great explanation about your story and how you see Southeast Asia and your ideas for business in Southeast Asia. And now I'm just happy to have you back in person.
(01:10) Jeffrey Lonsdale: You know it's fun. I haven't been to Singapore in a couple months. I thought it's good to swing by.
(01:14) Jeremy Au: Yeah, amazing. And I think that one just was saying. So does he think about the US- Southeast Asia interactions? And I was like, that is an excellent question to go into because I don't know either, actually, really.
(01:29) So, I just thought it would be a nice way to foster this brainstorm and talk about what's going on.
(01:32) Jeffrey Lonsdale: Yeah, sure. I would say that anyone who claims to really know what's going on is being a bit overconfident, I would say.
(01:40) Jeremy Au: So, this is gonna be a speculation. Yes. So rather than, "don't look at us as definitive.
(01:44) This is not investment advice."
(01:46) Jeffrey Lonsdale: But by the time, like I was saying earlier before we turn on the cameras that I wasn't sure if there had been something announced in the last day or two since I've checked the news that would invalidate what I would say here and there's gonna be another week or so as you edit (02:00) this, where more could have happened to completely show people that it's completely off base here.
(02:05) Jeremy Au: Is this episode only works more 24 hours, otherwise it's too stale like a croissant. But I think the way that we look at it obviously is it feels like the USA after the elections has gone through this massive change, obviously, under the Trump administration with a mandate to change and with a desire change
(02:19) and the velocity has been very huge and so I think everyone's processing. So maybe why don't we zoom in really on America first and say, how would you summarize the situation from your perspective?
(02:27) Jeffrey Lonsdale: I'd say that Trump came into power with the mandate to rebuild America's manufacturing base. And one of the main tools he sees to use this
(02:35) is tariffs. And that in their minds, they see as a consumption tax they can use to try to force Americans to both invest more locally as well as potentially consume a bit less and switch back to higher saving society.
(02:49) Jeremy Au: Yeah. And I think that's really interesting because that was something that was actually new to me even the past week.
(02:53) We just not at tariffs as a way to control trade, but also as a way to be a consumption tax similar to the (03:00) goods and services tax (GST) in Singapore, value added tax in the EU. So, it is been interesting to hear about it framed that way.
(03:06) Jeffrey Lonsdale: Yeah. This isn't why he's opposing the EU because he sees that as something that prevents their citizens from consuming while not imposing that on the rest of the world, which they're exporting to more cheaply than their consumers are able to buy those products.
(03:18) Jeremy Au: Yeah, I think it is interesting, right? Because traditionally value added tax is meant to say, ' Hey, we're gonna capture our economic activity is relatively fair, efficient, and it lowers consumption to some extent and raises tax revenue.' So, I think people have always looked at it as a domestic issue rather than now. Value added tax is being seen as something that Trump wants to rebalance against.
(03:37) Jeffrey Lonsdale: And I, in general, from the economic point of view, I'm not sure that the consumption tax matters as much as, let's say, the trade barriers that China is putting up, that just making or even the EUs putting up and finding all the US tech companies billions of dollars. I think that's a much more direct, anti-competitive aspect that hopefully the Trump administration will figure out how to push back against compared to the value added tax. But the (04:00) value added tax is something else. By putting on the table, maybe they can get concessions for not taking it when they take it off the table.
(04:06) Jeremy Au: That's a tricky part because I think the tariffs have a scenario where they are asymmetrical, right?
(04:11) So only America imposes tariffs, and then there's also the reciprocal effect, which is supposedly that's where a trade war happens, right? And I think that's like the tricky part that everyone's like. Not sure about, is it like, is Trump gonna be able to do it? Where primarily one way. And he get what he wants, which is against sheltering US manufacturers and moving production locally versus, does it become more symmetrical where the trade war happens?
(04:32) And then American export is also loose in that scenario.
(04:35) Jeffrey Lonsdale: If you talk to economists, obviously all economists agree that tariffs are generally not great for world trade, and there are potential like corner case exceptions to this. But for the politicians overseas who are listening to economists, the proper response to a trade war escalation is actually to not escalate.
(04:53) Jeremy Au: Because if you add tariffs on top of the other person's tariffs, you're just hurting your own people in the same way. Yes. So, (05:00) the problem with this is that around the world especially, at least in the Western world, it seems that one of the things that politicians have figured out is that the best way for them to win reelection is to run against Trump in their country. And they're anchoring this on Canada where the liberal party, Trudeau's party. Now Trudeau's out, they are actually in a much better chance to win the election since the tariffs and since they started running against Trump and not the opposition. And I think a lot of European leaders and other people around the world think, 'Hey, if we can run against Trump and not our opposition, we can actually win that election.'
(05:31) Like you said, the two alternatives are: Mexico has very much been bit more passive. Let's keep it low key. Whereas Canada has been very much more "We're willing to escalate or go tit for tat."
(05:39) Jeffrey Lonsdale: Yeah. But in both cases, Mexico is actually actively pushing back as well. And I think their president's never been more popular at this point when they're seen as the person standing up to their neighbor up north.
(05:50) Jeremy Au: Yeah.
(05:50) Jeffrey Lonsdale: So, it's an unfortunate dynamic that encourages more conflict and leads to a lower chance of positive resolutions because the leaders are (06:00) incentivized to make the problem worse and to try to rally their population around them against a foreign adversary.
(06:05) Jeremy Au: Yeah. So, let's talk about those two scenarios, right? One is the positive resolution that you mentioned, and what would be a negative version of this future? Let's say we fast forward, I guess three and a half years in the future, what would be a positive scenario and what would be a negative scenario?
(06:18) Jeffrey Lonsdale: From the perspective of the US, one of the positive scenarios is that instead of actually trying to only use tariffs to fix this problem, tariffs are one part of the solution. And they implement other aspects to make it easier to build in the US. You always look at these numbers where it costs more for the US to build roads, it takes almost twice as long for them to build new semiconductor plants compared to other places around the world.
(06:39) And there's all this red tape and regulation that needs to be cut through in order to allow people to build as quickly and as efficiently inside the US, outside the US. So, if the Trump administration only does tariffs, that's not gonna be enough to increase the production inside the US. It's not just cutting the red tape where the red tape is completely (07:00) useless. There're even scenarios where, "yes, we want these environmental regulations. We don't want you dumping toxic chemicals into the river, but we're going to have you prove that you're doing this in a far more cheap and efficient way than you had to prove in the past".
(07:12) So, you pay less lawyers, less consultants, and the project gets going much faster which lower the cost of capital of the project in total. Yeah. And there're ways where, hopefully that can result in a lot more manufacturing being done inside the US. And that's the positive scenario where the US industrial base is revitalized from a collection of these policies in total.
(07:31) Yeah. And maybe the rest of the western world as well also realizes that they need to pivot away from the dependency on China and that they also are able to do something similar in their economies.
(07:41) Jeremy Au: And what would the negative scenario be? Would it be like, a symmetrical trade war?
(07:46) Everybody's has, reciprocal tariffs, the efficiency doesn't play out.
(07:51) Jeffrey Lonsdale: Yeah. The negative version of this is higher tariff barriers that just make everything more fragile. Some companies going under that wouldn't have otherwise gone under, (08:00) combined with no real reforms that actually revitalize the industrial nature of these various economies as well as then maybe the thing that everyone is worried about with China making some move on Taiwan that cuts them off from China and people see just how exposed they really were to having outsourced key parts of their industrial base to China.
(08:18) Jeremy Au: Yeah, I think there's a lot of fear actually in some of the Chinese nationals I've met. Feels like there's like a 20 to 30% chance of some Taiwan issue going sideways in the next five years, which is, I think, pretty high percentage.
(08:30) Jeffrey Lonsdale: Yep. And it's definitely a worry and there's all different parts of the economy where there's some key component is being made in China at this point. And they might have even lost the ability to manufacture it in the US at anything like a comparable price.
(08:43) So, if China truly gets cut off from the world because they make a very strong move against Taiwan, then we'll see a lot of different industries realize just how dependent they are on that manufacturing base and how long it takes to scale up the replacement parts will be another (09:00) big question. We saw that the last time we needed to scale up production of various things during covid with the mass and whatnot.
(09:06) We didn't do a very good job of replacing some of those capabilities.
(09:11) Jeremy Au: Yeah, and I think that's gonna be a tricky part. Because I think China's also doing a similar move, right? Where they're trying to become more self-sufficient as well. Ever since season thinking of the power, he's been very much like moving and diversifying, for example, their commodity space moving away from American soybeans to soybeans from South America and other parts of the world. So, it'd be interesting to see them also becoming more self-sufficient in that way as well.
(09:33) Jeffrey Lonsdale: And that's some level of self-sufficiency. But having produce made in South America and Africa, there is still the issue where a blockade would actually prevent those from getting to them. So, they're still not quite self-sufficient in a way that would allow them to become a total pariah of the world.
(09:50) Jeremy Au: Yeah, and I think there's a little bit of talking past each other on this one, right? Because there's this dynamic where China's working very hard on South China Sea to avoid potential for blockade, right?
(09:59) Because (10:00) they worried that's existential for them, and vice versa. There's also this whole dynamic where, you know, people don't want them to be operating in South China Sea. So, I think there's a,
(10:09) Jeffrey Lonsdale: they don't want them to take over and claim the South China Sea when it was never part of their country to begin with.
(10:15) Jeremy Au: So, I think that's the tricky part where everybody's like maneuvering and it does feel like a flash point in the next five years.
(10:21) Jeffrey Lonsdale: And there's flash points with all the different countries in the South China Sea. 'Cause China's claiming territory that otherwise around the world is recognized to belong to other countries.
(10:29) Jeremy Au: Yeah, the exclusive economic zones and so forth. So not an easy dynamic. And I think for me, I always think to myself like, since there's a 20, 30% chance of Taiwan going sideways, moving beyond that, there's a certain level of economic first order, second order, third order effects are gonna happen, right?
(10:44) First order effect would be, it's hard to replace what TSMC has available on Taiwan terms of production for semiconductors, but I'm curious what you think those second, third order effects are gonna be.
(10:54) Jeffrey Lonsdale: There's all sorts of electrical parts and things like that, that are also made in China.
(10:57) All sorts of basic machining parts that (11:00) are mostly made in China. And to get them at scale, people are still getting them from China. And so there's a lot of these other businesses that would not necessarily be able to operate if China moved against Taiwan and people had not moved enough supply chains out of China.
(11:12) I think that's the race right now, and that's what Southeast Asia is benefiting from, is this push to move various supply chains out of China Obviously the Trump administration, others might prefer that some of those go back to the US, but in the short term, there isn't that capability to produce certain things in the US at a price point that would make sense for the world market.
(11:31) But there is that ability to do so in Southeast Asia and in India. And so there's been a lot of production moving to those places to. Hedge against this big risks that people saw play out in Russia.
(11:43) Jeremy Au: No, I think there's a fair point. I should never thought about that, which is that, if there is a Taiwan conflict, that issue is, it's not just Taiwan components and manufacturing at risk, but also the Chinese supply chain, there could be economic tensions or like trade barriers that come up.
(11:55) So I think what you started to mention now is the impact on Southeast Asia. And I think that's a quite diverse group of (12:00) countries. Obviously there's Vietnam. There's Indonesia. There's Singapore. So lots of different impacts. Philippines, Thailand, Malaysia as well. So I guess in my head, I think one question I'll have is Vietnam is like the third largest, like trade deficit for America in terms of, nations.
(12:14) I think a lot of people are saying like, is there a risk that you would also come under the same trade barriers or tariffs? I think it's one side. Or is it gonna be like, this is a way for us to move manufacturing out of China anyway. So just curious.
(12:26) Jeffrey Lonsdale: it's both because if you see the crackdown on China, the natural response will be to reroute certain trade goods through Vietnam that were actually manufactured in China or through Singapore as the case may be.
(12:37) And when the Trump administration sees this happening, they will then have to reconsider their policies with regards to these countries if these countries are not policing it effectively. So there's that dynamic. And there's also the other dynamic where. the Trump administration sees the trade deficit they have with these countries, and they're going to want to impose tariffs to try to correct that as well.
(12:56) I know Vietnam is trying to figure out how they can reduce their tariff if they (13:00) can buy more agricultural goods or buy more LNG just to do something to reduce the large amount of deficit in a triangular system with multiple other countries Vietnam is still importing things that.
(13:12) The US is producing, but if they can import directly from the US it would look a lot better optically from the Trump administration.
(13:19) Jeremy Au: Yeah. I think they also made a big push to buy a lot planes, I think from Boeing as well. So I think there's a lot of moves where I think the Vietnamese association is pushing hard on that side as well.
(13:30) I think on the Singapore side it's also be interesting 'cause Singapore is trying to stay neutral right now between all parties. And I think that, I was just talking to somebody last night and the conversation was like. Do you think that's possible for, Singapore to stay neutral?
(13:41) I think that's an open question.
(13:43) Jeffrey Lonsdale: Once there's a much stronger controls on China, if they do make a move on Taiwan, it would be extremely difficult to stay actually neutral. Yeah. Because being neutral by definition being on the side of China in a sense, if they continue to try to facilitate interactions between China and the rest of the world, (14:00) yeah.
(14:00) So that, that will be a challenge that they'll have to address. When it comes down to it is how do they stay neutral while not necessarily facilitating transactions that the US and others might want to ban?
(14:12) Jeremy Au: Yeah, I think everybody's just hoping that the status quo continues and then, sure it's okay for supply chain to change and everything, but everybody's hoping that the shoe doesn't drop.
(14:21) Jeffrey Lonsdale: Yeah, Xi Jinping did just say recently that they didn't have to take over Taiwan in 2027, so people are hoping that means that he's going to take a more conciliatory approach. But at the same time, I think the Taiwanese president has been making more statements that is almost baiting them into doing something.
(14:39) Jeremy Au: I think that's the tricky part for why the one China policy has existed, right? Is that it's supposed to keep it diffuse enough and hopefully diffuse the situation as much as possible. And, I think everybody's worried that, it's gonna get peeled away or actions taken in the next decade.
(14:57) Jeffrey Lonsdale: Obviously in retrospect though, the one China policy (15:00) agreements were an obvious mistake that was made at a time when it was actually a mistake for the West. It was a brilliant move by China to postpone this while they regrew their economy and had more bargaining power and more physical power later on.
(15:13) But to not settle the question when. They were not dominant in various ways. Was obviously 50 years saying Yes, give the 50 years to grow into the power and use the population to against them. I guess the people at the time were far more worried about Russia and the Soviet Union Yeah. Than about China.
(15:31) So it's understandable.
(15:32) Jeremy Au: Yeah, it's hard to rewrite history in 19 50, 19 60, 19 70, but I think it's gonna be interesting because I think Southeast Asia is like in this interesting spot, which is like. Is the current situation, net positive, net negative? I think people are really in that question mark zone right now.
(15:49) Jeffrey Lonsdale: The China plus one demand has been an obvious net positive as many corporations have increased their FDI and the countries in the region as they (16:00) needed to move outta China. And there's also some potential skill transfer and other things as they're upgrading the capabilities of these factories to produce.
(16:08) The higher value goods. Yeah. So there's, that's parts of net positive. The trade war aspect could end up being a net negative if it escalates to a trade war. Yeah.
(16:16) Jeremy Au: Yeah, I think that's a tricky part. As of today, it's net positive 'cause of China plus one, but if it blows up into a real trade war where trade volumes drop, then I think it might be net neutral that negative.
(16:26)
(16:26) Jeffrey Lonsdale: And in general, like when economies do well, I think people miss this. It is positive some, yeah. When the economies are functioning better, everyone is better off, and when things are not functioning better, everyone is worse off.
(16:37) If China moves against Taiwan, that's catastrophic, obviously, mostly for Taiwan, but also the rest of the world. So similarly, if there's a massive trade war that can end up being very bad for the rest of the world as well. Although like the cost advantage is such that if tariffs do go up 20%, there is still going to be.
(16:56) Goods shipped from Vietnam, from Indonesia, et cetera, to the (17:00) us. That's not gonna make the US producers that are making them at two x, it's not going, it's gonna reduce the demand for these products from these factories, but it's not gonna mean they're not the ones still making them and selling them into the us.
(17:10) They'll just be slightly less profitable and grow a bit more slowly.
(17:13) Jeremy Au: Yeah I think it's interesting because that rebalancing of, Southeast Asia Tigers, right? They were historically export oriented and exported to the US right? USB CD Players and now it's, airports and iPhones.
(17:26) So I think to some extent terrorists being a consumption tax on American consumer, thus in the long term actually feels like it's a slowing of demand for Asian exports. So it's interesting like short term, medium term, long term kind of dynamic.
(17:40) Jeffrey Lonsdale: As long as the tariffs aren't rising, just with no expectation of stopping it, it is one hit to the demand and then the demand will go back to grow and hopefully catch that baseline in a few years or so as well, depending on the area. So that's the point. Yeah. So it's not like tariffs will mean that these countries will not be exporting. I think also the export (18:00) growth will still be extremely important for them and investors.
(18:02) I think in Indonesia especially, are still gonna be looking for export oriented companies so they can make sure that the customers are real and that there's real demand for the products.
(18:10) Jeremy Au: Yeah, I think I like what you said about it is like the assumption that we have is that these tariffs are also one time, and obviously the current Trump administration is for four years and then after that there'll be another election. but I think it's interesting because, one thing that we were discussing across some Southeast Asian friends that even if there is a Democrat administration.
(18:28) It may not necessarily mean that the tariffs go down, actually. So it's similar to how Biden actually continued many Trump policies as well. So I think it's, not just one time. It's not going to go to zero. it's not temporal or temporary, but like you said, it could go up again, it could continue with no change or it could be, repealed.
(18:47) And I think that's the part where a lot of folks are like. Is this policy for three years? how do you adjust for that?
(18:51) Jeffrey Lonsdale: Yeah. Biden did continue the tariffs and JD Vance is likely to continue. if he is the nominee next time around, he was likely to continue (19:00) a variety of the policies of the Trump administration.
(19:02) And if he's elected, he'll be because they're popular. So it's one of those things where the tar will continue, but the cost advantage of Southeast Asia. Is going to be greater than most of these tariffs. it would be hard to use tariffs alone to keep BYD out of America, they have to basically ban the cars from operating or ban certain aspects of the cars and the way they report data back to China or whatnot to stop them from operating in the us as long as. Products are not outright banned from Southeast Asia, they'll still be relatively competitive and selling into the US market. It might be a US market that's smaller or is growing more slowly than it was previously, but they'll still be the main suppliers of the goods that they have the comparative advantage in producing.
(19:42) Jeremy Au: Yeah, I think you guys' gonna be an interesting time for the next few years. I'm just curious is there any advice that you give to Southeast Asian friends? Is there anything that you would advise them to think about or consider?
(19:53) Jeffrey Lonsdale: I would just advise them not to panic as much about this as they seem to be panicking and also to realize that (20:00) there is far more of a method to what's coming outta the US than people think.
(20:03) The Europeans are now scrambling to do exactly what the US has been trying to get them to do for the last 10, 15 years, which is actually spend more of their money on defense and take care of themselves.
(20:13) And they're doing it because they're angry at Trump, but they're actually doing it now. And so people say, oh, it was a mess up. Like how he angered all those people, but he got exactly what, not just what Trump wants, but what the US has always been trying to accomplish.
(20:25) Jeremy Au: Yeah, I think, it's fair that everybody knows that Europe had below average defense spending as a percentage of GDP, and you were using that as a budget for education or social services, et cetera. This is something that is a set of negotiation for both parties.
(20:40) Jeffrey Lonsdale: Yeah, judging the US as being outta control when it's not actually outta control and there are reasons behind what they're doing, it's one of the main things.
(20:47) And also just not panicking as much about it. Obviously, it's very bad for certain businesses if they get hit by tariffs and they'll have to change the prices and demand will go down for the businesses on the cusp of being non-viable, this might send a few over the edge, but for the (21:00) other businesses that were actually viable and profitable already, yeah, it's gonna be a hit, but it's not gonna be that big of a hit.
(21:06) Jeremy Au: Do you see more Chinese businesses moving out into Southeast Asia?
(21:10) Jeffrey Lonsdale: And obviously I, the biggest example is ByteDance trying to pretend they're a Singaporean company, right? To the extent that there are global businesses, there might be a few more trying that. But there's also been some pushback when trying to remember that was Li Ka-Shing, he sold the ports in Panama.
(21:24) Right now China's implementing an antitrust investigation of that move. So there are Chinese companies who are going to be constrained by the Chinese government in how they operate outside of China. And the ones who have the blessing to move outside will, but. It's unlikely that Xi Jinping wants many of these Chinese companies to actually relocate from China.
(21:43) But for the ones who are small enough where they escape that attention, they're able to reposition themselves as a Southeast Asian company or even a US company. If they can get outta China, they will have advantages to be doing that.
(21:56) Jeremy Au: Yeah. Actually, I was quite surprised that the Li Ka-Shing sold (22:00) their ports globally as well as the facilities around the Panama Canal.
(22:04) Because generally I feel like just that kind of move would have be cleared by the Chinese government first.
(22:09) Jeffrey Lonsdale: So Hong Kong publicly listed Hong Kong company. And when the government is mad at you in a small country like that, they can make it extremely unprofitable for you to disobey them.
(22:18) Yeah. And so Panama's arm was being twisted by the US and the US is extremely able to twist arms with the companies in their, jurisdiction. Yeah, I think there's a lot
(22:27) Jeremy Au: of behind the scenes interactions with the US government, with the Chinese government, so I think it's gonna be interesting to see how that plays out.
(22:33) I just feel like this is gonna be a giant legal and political free for all for another one year at least.
(22:39) Jeffrey Lonsdale: Yeah they were in a no win situation and getting some liquidity from that was probably the right move.
(22:43) Jeremy Au: from a company perspective because he's just saying this is time for me to sell before it gets hot. But whether they're gonna be allowed to do it...
(22:49) Jeffrey Lonsdale: They can't really reverse it at this point now, can they? It's the outside of China's jurisdiction
(22:54) Jeremy Au: yeah let's see. I feel like I've stopped trying to be not, I tend to be sometimes surprised by what (23:00) can happen actually.
(23:00) Jeffrey Lonsdale: I'm not gonna say they're not gonna be punished inside China, but the part like they are trying to say at the same time, look, Jack MA's back, please build technology more in China because they realize. The extent of their mistake. So it was interesting how both countries were actually very anti-capitalist in some ways.
(23:17) And over the immediate pre covid post covid years with China cracking down on technology in various ways and the US having administration that was further to the left than they've had in recent history, and both of them corrected, but in different ways. In China it was a Xi Jinping changing his mind in the US it was an election that brought Trump into power.
(23:35) Jeremy Au: Yeah, I think it's gonna be interesting 'cause nobody knows what Jinping is thinking. So I think that's the tricky part for everybody's I don't know, reading the tea leaves a little bit to why does that get the moves that's gonna happen?
(23:44) Jeffrey Lonsdale: Yep. And it's hard to, when someone has absolute power, it's very hard to predict what they're going to do.
(23:49) No one expected Putin to really want to engage in a long-term, full-scale war that drained his country's military resources significantly in trying to capture Ukraine. That (24:00) was, there was obviously people who saw it coming when it was getting closer, but as just a meta strategic move that just seems like inexplicable back in 2018.
(24:09) Jeremy Au: Yeah, for sure. And I think the couplers back then was the part, it was gonna be easy, right? And now it's out to be a lot harder. So I think that's the tricky part is the facts change over time. And I think when we look at the future, when you think about the next, five years, 20, 30, what's your hope for what do, what's your prediction for Southeast Asia?
(24:25) What do you think is gonna be that role from your perspective here?
(24:28) Jeffrey Lonsdale: Southeast Asia is still one of the fastest growing areas in the world, and I hope the different economies see where they've been messing up a little bit and preventing some of that growth. 'cause keep in mind for countries at the level of.
(24:39) Vietnam and Indonesia, if they had really strong policies, they would be growing at 10, 12%, which is the rate that China had when they were about as rich as those countries. So if Vietnam has some power constraints that they need to solve to unleash their growth. And among some other issues that their economy's facing.
(24:57) Indonesia similarly has various (25:00) regulatory issues they need to figure out and smooth out for external investors. I think I've heard that there's a variety of large financial companies global companies that refuse to sign any deals in Indonesia, and they have to sign them in Singapore because they don't trust the Indonesian courts not to automatically side with the local powerful families.
(25:18) As long as those dynamics persist and outsiders are deemed to be the suckers who fund projects for the insiders that eventually walk away with that money, it's gonna be very difficult for these economies to actually hit those levels of growth that can allow them to prosper at a much increased rate compared to today.
(25:38) Jeremy Au: I think there's so much more growth possible of Vietnam, Indonesia, and the rest of Southeast Asia. It's just that the right government policies, the right government actions can really double charge that. And I think recently we saw the scandals for e fishery and some other fraud in the tech Southeast Asian landscape that has, disrupted investor confidence for sure.
(25:54) Jeffrey Lonsdale: Yeah. It would be nice to see some tech champions emerge inside these economies where they're (26:00) actually, tech champions that dominate the economy, not because they're able to raise the most money, but because they're able to. Be extremely profitable.
(26:05) Jeremy Au: Exactly. And I think that's gonna be the path moving forward for the tech sector and Southeast Asia.
(26:09) On that note let to wrap things up, thank you so much for coming and sharing your story.
(26:13) Jeffrey Lonsdale: Yeah, thank you Jeremy. What is the story,
(26:15) Jeremy Au: The story of what Southeast Asia could be over the next five years? There's a narrative and we have to check back in five years, hopefully next five years we'll be like, oh, that was spot on.
(26:23) Jeffrey Lonsdale: I guess this was the story of Source.
(26:24) Jeremy Au: the story. We don't know what the next chapter looks like. Yeah. So on that note see you next time.
(26:28)Jeffrey Lonsdale: Yeah. Thanks Jeremy.