Industry leaders and analysts say Vietnam is an easy target for tariffs by the new Trump administration because it runs a large and growing trade surplus with the United States.
The communist-ruled Southeast Asian country is home to massive industrial operations by U.S. multinationals such as Apple, Google, Nike and Intel, and has the fourth-largest trade surplus with the United States, behind China, the European Union and Mexico.
U.S. trade data released on Thursday showed that the U.S. deficit with Vietnam reached $102 billion in the first 10 months of this year, an increase of nearly 20% from the same period in 2023.
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“For Trump, the main metric is the trade deficit, and Vietnam’s numbers are terrible,” said Deborah Elms, Asia trade policy director. Hinrich Foundationexplain.
“Vietnam is an ideal candidate for early action because it cannot retaliate easily,” she said.
President-elect Donald Trump, who took office in January, threatened during his campaign to impose tariffs of up to 20% on all U.S. imports.
Supporters keen to reduce trade deficit
Eric, his senior adviser, listed Vietnam as one of the countries “blackmailing” the United States, according to a video played at a business conference organized by the U.S. Chamber of Commerce in Hanoi last week.
At the event, some businessmen and trade association representatives expressed concerns about potential tariffs imposed by Vietnam.
“New tariffs are one of the biggest concerns for Korean industry in Vietnam,” Hong Sun, president of the Korean Chamber of Commerce in Vietnam, said at the meeting. South Korea's Samsung Electronics is a major exporter of smartphones and electronic equipment from Vietnam to the United States.
Vietnam's foreign ministry did not respond to a request for comment on potential tariffs, but Vietnamese officials have repeatedly urged Washington to maintain seamless trade.
Another sign Vietnam may face tariffs is Trump Selects Peter Navarro as his senior advisor for trade and manufacturing.
2025 plan
Navarro has said that imposing tariffs on Vietnam will be very effective in reducing the U.S. trade deficit. He wrote in the “2025 Plan” proposal that many policymakers in Washington regard it as the blueprint for the new Trump administration.
“Navarro has been a renowned expert on expanding U.S. manufacturing, imposing high tariffs and repatriating global supply chains under the Trump administration,” said Nguyen Hong, a supply chain expert at RMIT University in Vietnam.
Vietnam benefited from trade barriers Trump imposed on Beijing during his first term, which prompted manufacturers to move production out of China.
Hong said nearly a third of Vietnam's exports currently go to the United States and the country needs to improve the traceability of goods and parts to allay concerns that it is only used as an assembly site for products made in China.
Officials say China can partially offset its huge trade surplus by increasing imports from the United States, which could include liquefied natural gas (LNG), pharmaceuticals and aircraft.
However, it is unclear whether Vietnamese authorities support these offset measures and how significant their impact will be.
“I don't think Vietnam can buy quickly enough” to significantly reduce its surplus, said Elms of the Hinrich Foundation.
- Reuters Additional editing by Jim Pollard
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U.S. chip companies plan to invest $8 billion in Vietnam, officials say
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