President Trump has announced that a trade deal has been reach between the U.S. and Vietnam.
He says that deal would allow U.S. goods to enter Vietnam without any tariffs. But, those exports coming out of Vietnam into the U.S. would face a 20-percent tariff.
In addition, Trump says the U.S. would impose a 40 percent tax on “transshipping’’ — goods from another country that stop in Vietnam on their way to the U.S. The White House says that many Chinese goods have been dodging higher tariffs by stopping through Vietnam first.
Could the U.S. trade deal with Vietnam help get the ball rolling on other trade deals?
“People are viewing that as the stepping stone that other trade agreements could be reached by [President Trump’s] date of July 9th. Whether that holds true or not, that remains to be seen,” says Tom Fritz with EFG Group.
He adds that there are still a lot of unknowns when it comes to the status of trade agreements with many of our major trading partners.
“Prior to [Trump’s] announcement of the Vietnam trade agreement, he said, ‘I don’t know if we’re going to have an agreement with Japan. They’re just too tough to deal with.’ Then, he said he’s not talking to Canada anymore—he said that earlier in the week. Then, Canada made some concessions, but we still haven’t heard anything about it, so maybe that is a stepping stone to some trade agreements, but we haven’t heard anything else in that regard,” said Fritz.
Last year, the U.S. exported more than $3.8 billion in ag products to Vietnam, making it the ninth-largest foreign market for the U.S. ag industry.
However, in 2024, the U.S. trade deficit with Vietnam reached $113.1 billion. It was the largest third largest U.S. trade deficit after China ($270.4 billion) and Mexico ($157.2 million).
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