Vietnam Amid Global Trade Policy Adjustments
- Virtus Prosperity
- Apr 4
- 3 min read
New Developments in U.S. Trade Policy
On April 2, 2025, the U.S. government announced and implemented new tariffs on imported goods from multiple countries. This decision is part of an overall trade policy adjustment aimed at balancing the trade deficit and boosting domestic production. According to Reuters, the U.S. has imposed a baseline tariff of 10% on all countries, effective from April 5. Additionally, supplementary tariffs will be applied starting April 9 to countries with high trade surpluses with the U.S.
Clarification on the Mentioned 90% Tariff
Regarding the information about a 90% tariff mentioned by the U.S., it is important to clarify that this is not a tariff imposed by Vietnam on U.S. goods. Under current trade agreements, Vietnam’s tariff rates on U.S. imports remain in compliance with international commitments. Specific rates for key products include:
Agricultural Products: Cotton (0%), Soybeans (2%), Chicken (10%), Apples, Cherries, Nuts (5%)
Industrial & Energy: Liquefied natural gas (5%), Ethane, Semiconductor chips, Industrial machinery (0-5%)
Automobiles & Motorcycles: Automobiles (45-64%), Motorcycles (10%)
Former President Donald Trump explained that the 90% figure refers to “currency manipulation and trade barriers”, which he equates to the disparity between exports and imports.
For example, if Vietnam exports $100 billion worth of goods to the U.S. but imports only $10 billion, the resulting $90 billion trade gap is considered by Trump as "unfair."
In reality, Vietnam recorded a trade surplus with the U.S. of $136.6 billion in 2023 and $123 billion in 2024. To balance trade, Vietnam would need to import approximately 5 million automobiles from the U.S. annually.
Vietnam and Strategy to Respond to the U.S. 46% Tariff
As the 7th largest trading partner of the U.S. and 3rd in trade surplus, Vietnam cannot remain unaffected by global economic shifts. In the past year, Vietnam’s trade surplus with the U.S. exceeded $123 billion, with 75% of trade value dependent on exports. The imposition of a 46% tariff on Vietnamese exports by the U.S. poses a significant challenge to key industries such as textiles, footwear, and electronics. However, Vietnam has taken a proactive and strategic approach to maintain its trade advantages and strengthen bilateral relations with the U.S.
Vietnam’s Flexible Strategies
At the government meeting on February 5, 2025, Prime Minister Phạm Minh Chính chaired discussions on the risk of a global trade war, with response scenarios prepared in advance. In response to tariff pressures, Vietnam has implemented several measures to mitigate negative impacts, including:
Adjusting Import Tariffs:
Reducing the import tariff on U.S. liquefied natural gas (LNG) from 5% to 2%
Reducing the import tariff on U.S. automobiles from 45-64% to 32%
Reducing the import tariff on ethanol from 10% to 5%
Increasing imports of U.S. agricultural products to balance trade while tightening control on transshipped goods to avoid accusations of origin fraud.
Facilitating the operation of U.S. businesses in Vietnam, such as granting Starlink a license to provide services in Vietnam as a goodwill gesture for bilateral trade cooperation.
Strengthening Domestic Capabilities: A Sustainable Approach
Beyond short-term countermeasures, Vietnam is focusing on private sector development as a key economic driver. A robust private sector ecosystem will enhance Vietnam’s economic self-reliance and reduce dependence on exports.
Furthermore, the government has identified science, technology, innovation, and digital transformation as the foundation for long-term economic growth. Vietnam’s top leadership has repeatedly emphasized that this is "an imperative choice, the only path to national development and improving people’s livelihoods."
Economic Diplomacy: Balancing Interests in Negotiations
On April 6, 2025, Deputy Prime Minister Ho Đuc Phoc will lead a delegation to the U.S. to continue dialogues and seek mutually beneficial cooperation solutions. President Donald Trump’s remark that "Vietnamese are great negotiators" when announcing the 46% tariff is not coincidental. It reflects the long-standing negotiation efforts between Vietnam and the U.S. since 2019.
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