Daily Update — May 20, 2025
Vietnam’s Tariff Concerns; AI Chip Smuggling; and the US Standard of Living
Today is Tuesday, May 20, 2025, and here’s your curated selection of Essential Intelligence on global markets from S&P Global. Subscribe to be notified of each new Daily Update.
Global Trade
US tariffs cloud Vietnam's energy transition
Southeast Asia became an area of key interest amid escalating geopolitical tensions after the US announced tariffs on April 2. Since the initial wave of tariffs on China in 2018, Southeast Asia has increasingly become a hub for Chinese exports to the US. However the proposed tariffs, which could range from 10% to 49% if enacted, have raised alarms regarding potential supply chain disruptions and a trend toward reshoring manufacturing to regions with lower tariffs.
The current 90-day pause in tariff implementation provides an opportunity for negotiation, and China's efforts to strengthen regional alliances may influence developments. The recent agreement between the US and China, which temporarily reduces tariffs to 10% from 125%, offers hope that Southeast Asia could see a similar easing of trade tensions.
Artificial Intelligence
Listen: An Illinois Lawmaker's Plan to Block Global Chip Smuggling
Ahead of the May 15 announcement of the Chip Security Act, Rep. Bill Foster of Illinois discussed the issue of AI chip smuggling in S&P Global Market Intelligence’s “MediaTalk” podcast. Following news about DeepSeek allegedly using smuggled chips, reports have emerged of advanced AI chips being smuggled outside of the US in violation of export controls.
To address this, Foster is seeking new bipartisan legislation that would require chipmakers to incorporate location verification mechanisms within their products. This would allow datacenters to verify the presence of chips via cryptographic challenges, leveraging existing technology to prevent unauthorized movements.
Economy
The American standard of living is showing cracks
Most Americans maintained a positive outlook on their standard of living, despite challenges such as rising home prices and insufficient retirement savings. According to the S&P Global Market Intelligence Kagan first-quarter 2025 US Consumer Insights survey, 63% of internet adults believe they have or will achieve a higher standard of living than their parents. This optimistic perspective is consistent across various demographics, including age, race/ethnicity, size of population center and education level.
However, household income is a significant influence on these perceptions. Approximately 47% of adults in households earning less than $50,000 disagreed with the notion that they will have a better standard of living than their parents. This disparity highlights the growing divide in perceptions of economic well-being among different income groups.
Learn more about global economic health from S&P Global Market Intelligence’s Purchasing Managers' Index.
In case you missed it
- US domestic coal market prices rallied modestly in April, even as natural gas prices eased. Natural gas prices remain strong, however, and combined with reduced coal inventories earlier this year, continue to support firmer steam coal demand in 2025.
- Portugal-based Novo Banco's owners are looking to sell the bank, which has transformed from one of Europe's most notorious failed lenders to being more profitable, efficient and well-capitalized than most other large European banks.
Upcoming events
- Sustainability Nexus Webinar Series: Scaling Sustainable Agriculture | May 21 (Webinar)
- Renewable Pathways: Empowering Datacenter Energy Procurement | May 21 (Webinar)
- Tariffs and Supply Chain Dynamics: Assessing Customer and Supplier Risk in a Global Market | May 22 (Webinar)