In hope of avoiding punishing US tariffs, Vietnam is prepared to crack down on Chinese goods being shipped to the US via its territory, and is to tighten controls on sensitive exports to China, said a person familiar with the matter and a government document seen by Reuters showed.
The offer came as senior US officials, including US President Donald Trump’s trade advisor Peter Navarro, raised concerns about Chinese goods being sent to the US with “Made in Vietnam” labels that draw lower duties. Vietnam has for weeks been offering sweeteners that it hoped would persuade Trump’s administration to take a benign view of its huge trade surplus with the US.
Instead, it was hit with a 46 percent tariff as part of Trump’s “liberation day” salvo.
Photo: AFP
While the tariff has been suspended for 90 days, the two countries agreed to start talks after Vietnamese Deputy Prime Minister Ho Duc Phoc met with US Secretary of the Treasury Scott Bessent on Wednesday.
Export-reliant Vietnam is hoping to get the duties reduced to a range of 22 percent to 28 percent, if not lower, three people with knowledge of the matter said.
One of them said that US officials during a bilateral meeting last month had signaled that range was likely.
In announcing the start of trade talks with the US yesterday, Vietnam’s government said on its official portal it would crack down on “trade fraud.” It did not provide specifics.
Since Trump’s first term, many multinational firms have implemented a “China plus one” policy of setting up factories in Vietnam to reduce exposure to Beijing.
The Southeast Asian nation is in a tight spot as it tries to preserve trade with the US, which is its largest export market and a security partner. At the same time, Hanoi does not want to antagonize China, which is a top source of investment as well as a neighbor with which it has clashed over boundaries in the South China Sea.
Vietnam’s Government Office, a body that coordinates between its ministries, held an emergency meeting with government trade experts on Thursday last week, hours after Trump announced the tariffs.
The aim was to address Washington’s concerns over alleged intellectual property theft and transhipment abuses, a person briefed on the meeting said.
At the meeting, the Vietnamese Ministry of Industry and Trade and customs officials were told to tighten controls and were given two weeks to devise a plan to clamp down on illicit transhipment.
The deadline could be extended until late this month, the person said, adding that Hanoi wanted to be careful not to provoke China.
Illicit transhipment refers to one country sending goods to a nation facing lower tariffs from a third country, to which the product is re-exported without having value added to it.
Many of the goods exported by Vietnam to the West have Chinese-made inputs, and Chinese companies have also established factories in the country to serve US customers.
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