Boats in the port of Mui Ne, Vietnam, on March 8, 2023.
Alexandra Schuler | Picture Alliance | Pictures of getty
Vietnam has long been considered a successful example of embracing external trade, attracting some of the world’s largest companies to establish hubs to make everything from footwear to electronic products that grace stores around the world.
But now, worries are causing the aggressive rates of United States President Donald Trump to rule out the ambitious Vietnam growth goal despite diplomatic openings in Washington that economists say that they are unlikely to change politics soon.
Trump hit the South Nation -East Asian with 46% importone of the most abrupt between the more than 180 directed countriestreating a strong blow to a nation that derived Almost 90% of their annual gross domestic product From the exports of goods and services by 2023, according to the estimates of the World Bank.
The new taxes could shave 1.2 Percentage of Vietnam’s economic growth this year, according to the estimates of an OCBC Bank economist team, which prompted them to reduce GDP forecast for the country to 5% by 2025. “at least 8%” this year.
The growth of the South Economy -East Asian has already slowed this year, expanding 6.93% in the first quarter, up to 7.55% of the quarter before.
Vietnam has appeared as a manufacturing center for many products selling products in the United States, including multinational consumer goods retailers such as Nike, Adidas, Uniqlo and Apple IncDue to a combination of relatively cheap labor costs and government policies.
According to Nike’s annual results report by 2024, factories in Vietnam Manufactured 50% of their footwear and 28% of their clothing products while Adidas obtained 39% of their footwear items From Vietnam last year. Apple also has it expanded its manufacture presence in Vietnam In recent years, with about 20% of iPad production and 90% of Apple’s portable products as Apple Watch that takes place in Vietnam.
Since the last trade war in the United States-Thin has exploded during Trump’s first term in 2018, many Chinese manufacturers have also transferred their production to Vietnam to prevent United States’ rates.
Vietnam commercial surplus in assets with the United States more than tripled to Record a maximum of $ 123.5 billion Last year, less than $ 40 billion in 2018, according to US data that stuck Vietnam’s property exported to the United States at $ 136.6 billion by 2024.
An anchored container boat at Hai Phong Port, Vietnam, on Monday, March 18, 2024. Vietnam is scheduled to publish export figures on March 25.
Linh Pham | Bloomberg | Pictures of getty
The new taxes announced by Trump last week could reduce the exports of Vietnam goods to 40% by 40% to 40% this year, according to OCBC Bank. The bank cited data from the Vietnam Customs Authority, which showed that exports of Vietnam goods to the United States accounted for about 30% of its total trade turnover.
New duties can also reduce the attractiveness of creating a country manufacturing base, weighing foreign direct investment in Vietnam.
But as is often the case International commercial statisticsThere are discrepancies between the official numbers reported by the United States and Vietnam, in part due to differences in valuation methods.
Nguyen Thu Oanh, head of the Inflation Department at the Statistics Office, Finger Bloomberg reported that the new North -American rates could lead some foreign companies to move part of their Vietnam production.
« Ascean and Indian reciprocal rates will harm the » China+1 « strategy that has benefited the region for some years, » said OCBC Bank economists, but « time will take time for the world supply chains to be adjusted. »
Hard road for the offer
Apart from China, Vietnam will face a more difficult path to an agreement with Washington than others in Asia, said Chetan Ahya, an economist in Asia de Morgan Stanley, thanks in part to his great commercial surplus with the United States and his role in facilitating the reaction of the Chinese companies supply chains.
After a Telephone call with Trump last FridayThe Vietnam’s head head, to LAm
He also reiterated Hanoi’s commitment to promoting United States imports to reduce bilateral commercial surplus and encouraged North -American companies to increase investments in Vietnam.
In response to questions about the Vietnam’s Tariff Zero offer, said White House Minister Peter Navarro It wasn’t enough to justify a cancellation of new taxes.
« We take the Vietnam. When they come to us and say » we will go to the zero rates « , this means nothing because it is the trap that is important, » Navarro told CNBC « »Squawk box. « »
Examples of « Non-Notts » cited by Navarro included that Chinese products were directed through Vietnam, theft of intellectual properties and the value-added tax on goods, which Trump has criticized as hidden commercial barriers.
Hanoi sought to offer commercial commitments down the rates in various North -Americans such as gas and liquefied natural cars, and approve A test of the Starlink Satellite Internet Service In the country.
China has been retaliated with An additional 34% rate to all North -AmericansBut most Asian economies have chosen to abstain from direct retaliation.
Negotiating Asian economies with the United States may not « get desired results, especially for countries that have a great commercial surplus with the United States, such as Vietnam, » said Michael Wan, the main economist in Asia at MUFG Bank.
Although Vietnam’s negotiation with Trump administration may « support some fruits », it is unlikely that the United States offers to cut « dramatically » rates of the proposed levels, he said.
China’s retaliation has complicated Vietnam negotiations with the United States, as policymakers are concerned that Chinese companies could exploit the most unpleasant rates in Vietnam, said Wan.
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