Strategic Directions to Counter US Tariff Policies

In a decisive move, Prime Minister Chinh has instructed various ministries, local authorities, and state-owned enterprises to actively engage in strategies aimed at navigating the complexities of the U.S. tariff policy. The directive underscores the importance of ongoing negotiations to forge a comprehensive trade agreement that not only bolsters bilateral economic ties but does so in a manner that is both balanced and sustainable.

Efforts are also being ramped up to ensure the swift implementation of existing trade agreements and commitments with the U.S., alongside a comprehensive dissemination of information regarding the U.S. tariff policy to the public and businesses alike.

Understanding the Impact of Reciprocal Tariffs

The U.S. has introduced so-called "reciprocal" tariffs, effective from August 1, with rates varying between 10-41%. For Vietnam, the tariff rate has been adjusted to 20%, a significant reduction from the initially proposed 46% in April.

Preparing for the Future

A collaborative effort led by the Ministry of Finance, in conjunction with the trade ministry and other relevant agencies, is underway to draft a resolution. This resolution, aimed at presenting comprehensive measures to the government to address the U.S. tariff policy, is slated for completion by August 13.

Furthermore, the Prime Minister has emphasized the need for ministries, localities, and agencies to implement support measures effectively, enhancing the competitiveness of industries and businesses impacted by the new policy. This includes supporting the adoption of origin traceability systems and encouraging participation in regional and global supply and value chains.

Vietnam-US Trade Dynamics

With bilateral trade worth $149.7 billion last year, Vietnam's exports to the U.S. stood at $136.6 billion, contributing to a trade surplus of $123.5 billion. The first five months of this year have seen trade between the two nations surge by 36.5% year-on-year, reaching $77.4 billion, with Vietnamese exports growing by 37.3% to $71.7 billion.