Vietnam won big in Donald Trump’s first trade war. Now, it’s a target.
Subscribe to enjoy similar stories. Vietnam found the sweet spot in the global economy during President-elect Donald Trump’s first trade war with Beijing: smack in the middle of the U.S. and China.
The country became a magnet for Chinese manufacturers looking for a production base from which to ship their goods to the U.S. tariff-free. Now, as the incoming administration girds for new battles over trade, Trump and his team are signaling that they intend to slam this backdoor shut.
Such a move would hurt Vietnam’s small but rapidly growing economy, and likely mean higher prices for U.S. consumers who buy Vietnamese goods and U.S. companies supplied by Vietnamese factories.
Since Trump placed tariffs on Chinese goods six years ago, Vietnam has expanded around 8% a year, buoyed by a gusher of foreign investment and booming exports to the U.S. The country now supplies a third of the sports shoes, half of the wooden beds and dining tables, and a quarter of the solar cells imported by the U.S. Outside its capital Hanoi, once-sleepy northern provinces have been turned into export powerhouses, with rice paddies giving way to hulking billion-dollar factories assembling smartphones and semiconductors.
U.S. companies with suppliers in Vietnam include Apple, Nike and Gap. But in May, Jamieson Greer, Trump’s nominee for U.S.
trade representative, said the U.S. should tighten trade rules to prevent what he described as “third-country workarounds," in which goods that contain a lot of Chinese parts or were made in a third country by a subsidiary of a Chinese company enter the U.S. without facing the steep tariffs they would have done had they come direct from China.
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