Trump announces trade deal with Vietnam

President Trump says the U.S. has made a trade deal with Vietnam as part of his push to renegotiate tariffs with dozens of different countries around the world. It comes as the president’s self-imposed deadline for those tariff negotiations is just a week away.

In a social media post, Trump said tariffs will now be 20% on goods from Vietnam and 40% on goods shipped through Vietnam. While Trump wrote that Vietnam will pay these tariffs, that is untrue. U.S. businesses importing goods from Vietnam will be paying the taxes to the government.

He said that in return, Vietnam would “give the United States of America TOTAL ACCESS to their Markets for Trade,” meaning that “we will be able to sell our product into Vietnam at ZERO Tariff.” He specifically cited SUVs as a product that would be exported in larger numbers to Vietnam. However, the White House has not released further details on this agreement.

The announcement came after Trump in April proposed a steep 46% tariff on Vietnamese imports — one of the highest rates applied to any country — saying he would address the U.S. trade deficit with Vietnam. He has since temporarily set the tariff at 10%, which Trump called a “pause,” pending tariff negotiations between officials in Hanoi and Washington.

Trade relations between the U.S. and Vietnam have grown remarkably since the U.S. lifted its economic embargo on Vietnam in 1994. The two countries normalized diplomatic ties in 1995.

In 2001, the U.S. and Vietnam signed a bilateral trade agreement, granting Vietnam most-favored-nation status and paving the way for its ascension into the World Trade Organization.

Over the next two decades, trade between the two nations skyrocketed, reaching $149.6 billion by 2024 — about a 50-fold increase since 2002.

In 2023, the U.S. and Vietnam elevated their relationship to a “comprehensive strategic partnership,” strengthening ties that have been crucial to Vietnam’s economic growth. The U.S. is now Vietnam’s largest export market, accounting for nearly a third of its total exports. According to the Commerce Department, Vietnam’s main exports to the U.S. include machinery, appliances, clothing and shoes.

However, with significant trade imbalance favoring Vietnam raising concerns in Washington — the U.S. trade deficit reached over $123.5 billion in 2024 and $39.1 billion in the first quarter of 2025, U.S. officials have been pressing Vietnam to address non-trade barriers, combat fraud, and curb illegal transshipments. They also urge Vietnam to further open its market to U.S. goods and services.

The Vietnamese government set an ambitious 8% growth target for 2025, but a recent report supported by the Asian Development Bank suggested that U.S. reciprocal tariffs of 20% or higher could hinder achieving this goal.