Paul Wiseman and Anilda Gorsal
WASHINGTON (AP) – President Donald Trump announced his trade deal with Vietnam on Wednesday.
In contrast, Vietnam’s exports to the US will face a 20% collection.
On his true social platform, Trump has declared the agreement “a lot of cooperation between our two countries.”
In April, Trump announced a 46% tax on Vietnam’s imports. This is one of the so-called mutual tariffs targeting dozens of countries in which the US operates a trade deficit. Trump immediately suspended mutual tariffs for 90 days to allow negotiations with Vietnam. The suspension expires on Tuesday, but so far the Trump administration has reached a trade deal with only one of those countries, the UK. (Trump also reached a “framework” agreement with China in another trade dispute.)
“Vietnam wants to get out of here,” said Mary Lovely, a senior fellow at the Peterson Institute for International Economics. “This is basically forced to eat it in a small country. We can do it. It’s a big country that everyone is keeping an eye on.” She suspects Trump can impose such biased agreements on large corporate partners such as the European Union and Japan.
Last year, the US suffered a trade deficit of $122 billion with Vietnam. It was the third largest US trade gap (the difference between goods and services purchased from other countries and countries selling it), behind what was the presence of China and Mexico.
In addition to the 20% tariff, Trump said the US will impose a 40% tax on “transshipping.” Washington accussed that Chinese goods are dodging higher US tariffs by passing through Vietnam.
A February survey in Harvard Business Review found that there was “much less rerouting than previously believed.”
In May, Vietnam approved a $1.5 billion project by the Trump organization and local partners, building a massive golf resort complex near Hanoi, covering the size of 336 soccer fields.
Vietnam was a beneficiary of America’s efforts to counter China’s influence. Companies looking to diversify their supply chains away from China flocked to Vietnam.
In 2023, the state’s visit became the only country to host both President Joe Biden and Chinese leader Xi Jinping. That year, the US upgraded Vietnam to its highest diplomatic position, a holistic strategic partner, placing it on par with China and Russia.
Aniruddha Ghosal reported from Hanoi, Vietnam.
Original issue: July 2, 2025, 1:48pm EDT
