Trump Announces Vietnam Trade Deal With 20% Import Tariff
President Donald Trump said he had reached a trade deal with Vietnam following weeks of intense diplomacy between the nations and ahead of a deadline next week that would have seen higher tariffs imposed on the country’s imports.
A 20% tariff will be placed on Vietnamese exports to the US, with a 40% levy on any goods deemed to be transshipped through the country, Trump said in a social-media post on Wednesday. Trump said that Vietnam had agreed to drop all levies on US imports.
“In other words, they will “OPEN THEIR MARKET TO THE UNITED STATES,” meaning that, we will be able to sell our product into Vietnam at ZERO Tariff,”
Vietnam’s Ministry of Foreign Affairs said in a statement that Trump pledged to continue cooperating “in resolving issues affecting bilateral trade relations” during the leaders’ call Wednesday and that To Lam proposed that the US recognize Vietnam as a “market economy and remove export restrictions on certain high-tech products.”
The deal with Vietnam would be just the third announced following agreements with the UK and China, as trading partners race to cut agreements with the US ahead of a July 9 deadline. Trump had imposed a 46% duty on Vietnam as part of his initial rollout of so-called reciprocal tariffs in early April that were levied on dozens of countries, but were then pared back to 10% to allow time for negotiations.
Vietnam posed a particular challenge for the Trump administration, as some of the president’s top advisers view the nation as a strategic partner in efforts to counter China in Asia. At the same time, its exports have become staples for American consumers.
The Southeast Asian nation has seen its sales to US markets surge in recent years, partly because manufacturers shifted production there from China. It’s a major supplier of textiles and sportswear, hosting factories for companies such as Nike Inc., Gap Inc. and Lululemon Athletica Inc.
Vietnam was the sixth-biggest supplier of US imports last year, sending goods worth almost $137 billion, according to Census Bureau data. Its trade surplus with the US was the third-largest globally on a country basis behind only China and Mexico. Shipments in May jumped 35% as firms sought to get goods onto vessels as quickly as possible ahead of the deadline.
Source : Bloomberg
