US-Vietnam trade tensions ease as negotiations begin over new tariff agreement

In the first quarter of 2025, the United States became Vietnam’s largest export market, a position that was soon overshadowed by President Donald Trump’s announcement of a 46 per cent tariff on Vietnamese goods, part of a broader trade crackdown. However, the US president paused the implementation of these harsh tariffs on April 9, signaling potential negotiations between the two countries.

Vietnam’s Deputy Prime Minister, Ho Duc Phoc, suggested that both nations "should soon negotiate a bilateral trade agreement... to promote stable and mutually beneficial economic and trade relations," according to a statement released by the Vietnamese government, Caliber.Az reports via foreign media.

Phoc, who has been tasked with leading discussions on the tariffs, met with US Trade Representative Jamieson Greer on April 9. The two sides agreed that they would initiate negotiations on a "reciprocal trade agreement, which would include tariff agreements," with technical teams from both countries beginning talks immediately, as outlined in the government statement.

During his visit to the United States, Phoc held meetings with US senators, business leaders, and various organizations to discuss the tariff issue. His efforts came at a time when Vietnam was seeking to mitigate the impact of the new duties, which experts warn could severely harm Vietnam’s export-driven economy.

In another significant development, Vietnamese budget airline Vietjet announced on April 10 that it had signed a $300 million deal with AV AirFinance to expand its fleet. The agreement, signed in the presence of Deputy Prime Minister Phoc, is part of a larger $4 billion series of financing deals for aircraft purchases, including a $24 billion order for Boeing 737 MAX jets, originally announced in 2019. The first batch of these aircraft is expected to be delivered later this year.

Vietnam had previously requested a delay of at least 45 days before the imposition of the new tariffs, which Trump had targeted due to the country’s trade surplus with the United States. In response to the looming tariff threat, Vietnam pledged to purchase more US goods, including defence and security products, in an attempt to demonstrate its commitment to balancing the trade deficit.

Trump, however, has accused Vietnam of unfair trade practices, claiming that the country charges the United States a 90 per cent tariff, citing the trade imbalance of $123.5 billion between the two nations in 2024. The US administration has also voiced concerns about Vietnam’s role in circumventing the tariffs imposed on China during the ongoing trade war.

In April 10 statement, Vietnam emphasized that it had "proactively addressed many concerns of the US" in a bid to resolve the dispute and avoid the detrimental impact of the proposed tariffs.

As the US and Vietnam prepare to negotiate a trade agreement, both sides appear committed to fostering a relationship based on mutual benefit and stability. The outcome of these discussions could have significant implications for the global trade landscape, particularly as both countries aim to secure favorable terms for their economic futures.

By Vafa Guliyeva