President Donald Trump has announced a new trade agreement between the United States and Vietnam, introducing a 20% tariff on Vietnamese imports to the U.S. The announcement, made on Trump’s Truth Social platform, also promises tariff-free access for American exporters to Vietnamese markets.
The deal includes a 40% tariff on goods originating from third countries but routed through Vietnam before reaching the U.S., a move intended to curb transshipment practices often linked to China.
Previously, Vietnamese exports faced a 46% tariff, temporarily reduced to 10% during a 90-day negotiation period. The new 20% tariff is expected to raise costs for U.S. importers, potentially increasing prices for consumers in sectors like apparel and electronics.
Trump stated that Vietnam will pay the tariff, though tariffs are typically paid by U.S. importers rather than foreign exporters. Details on when the agreement will take effect or whether it has been formally signed remain unclear.
Vietnam is particularly sensitive to U.S. trade policy changes, with exports to the U.S. accounting for nearly 30% of its GDP. The announcement comes as the U.S. nears the end of a tariff pause designed to encourage trade negotiations. So far, revised deals have been reached with China and the UK, while talks with other countries continue.
Critics warn that unpredictable tariffs cause economic uncertainty and higher consumer prices, while supporters argue tariffs protect U.S. industries and generate government revenue. A recent analysis estimated that a 10% tariff on Vietnamese goods would raise the price of an imported men’s jumper by about 8%, compared to a 35% increase under the original 46% tariff.
U.S. Federal Reserve Chair Jerome Powell has indicated that tariff impacts are likely to become more evident in the coming months, with some price increases already seen in clothing and footwear.