Trump Nears Vietnam Trade Deal as Tariff Questions Linger

U.S. President Donald Trump said Tuesday that a trade deal with Vietnam is nearly finalized, following earlier statements that a preliminary agreement had been reached. Speaking at Joint Base Andrews, Trump indicated he could disclose more information but saw no need, stating, “We have a Vietnam deal, and I would say that deal is being pretty well set.”

The proposed agreement aims to reduce potential U.S. tariffs on Vietnamese imports to 20%, down from a previously threatened 46%. However, it would also impose a 40% duty on goods deemed illegally transshipped through Vietnam—a measure aimed at cracking down on Chinese products rerouted to bypass U.S. tariffs.

Details of the agreement remain vague. Key questions include how the U.S. will define “illegal transshipment,” what level of value-add Vietnam must provide to avoid penalties, and which specific goods will be affected by the revised 20% tariff rate. Vietnam has not confirmed tariff specifics, only noting a joint framework statement with the U.S.

Vietnam's trade with the U.S. has surged since the onset of the U.S.-China trade war in 2018. In response to wide-ranging U.S. tariffs on China, many manufacturers shifted operations to Vietnam. As a result, Vietnam nearly tripled exports to the U.S., reaching around $140 billion in 2024. Simultaneously, its imports from China rose to match, fueling concerns in Washington over trade circumvention.

While the deal could reshape trade dynamics in Southeast Asia, lack of transparency on enforcement and product scope continues to raise uncertainty for global businesses and investors. Analysts are watching closely to see how the final terms will impact U.S.-Vietnam-China supply chains.