The U.S. will now tax Vietnamese goods at a minimum of 20%
In a bold move just days before a major tariff deadline, former U.S. President Donald Trump has unveiled a new trade deal with Vietnam that enforces a 20% import tariff on Vietnamese goods, while giving American businesses zero-duty access to the Vietnamese market.
Trump announced the development via Truth Social, describing it as a “Great Deal of Cooperation” following direct talks with Vietnamese Communist Party General Secretary To Lam.
The agreement allows U.S. goods to enter Vietnam without any tariffs, a shift Trump called “historic.” He also pointed to SUVs made in the U.S. as being particularly well-suited for the Vietnamese consumer market, describing them as “a wonderful addition.”
However, not all imports will be treated the same. Transshipped items — foreign products passing through Vietnam will face a 40% tariff when entering the U.S., as part of an effort to close trade loopholes.
At first, U.S. stocks tied to Vietnam-based production saw a bump following the announcement. But once the full tariff details came out, shares dropped, signalling uncertainty among investors worried about rising costs.
This marks Trump’s third trade pact in recent months, coming after earlier deals with Britain and China, all crafted under his “reciprocal trade” strategy, aimed at punishing unfair practices.
Without this agreement, Vietnamese exports would have been hit with a 46% tariff starting July 9 under Trump’s previous policy. Now, the country escapes the most severe penalties, but still faces a doubled tariff from the earlier 10%.
With the deadline approaching fast, Japan and the EU are next in line. They must decide whether to sign similar deals or risk facing the same steep import taxes.
