(Oct 26): The US released details of its intended trade agreement with Vietnam on Sunday, among a raft of measures signed or released during the first day of US President Donald Trump’s visit to the region.
Crucial specifics are still undetermined, but it’s the first outline released by the Trump administration since a 20% headline tariff was announced in July.
Under the framework, Vietnam will “provide preferential market access for substantially all US industrial and agricultural exports to Vietnam,” while the US will offer zero tariffs on some selected products, according to a White House statement.
It didn’t provide any details on which products would be excluded, but said the agreement would be finalised “in the coming weeks”.
The announcement came during Trump’s stop in Malaysia, which is hosting an Association of Southeast Asian Nations (Asean) summit. The US leader signed a trade deal with Cambodia and Malaysia, and framework for a deal with Thailand.
The Vietnamese government said later in a statement that Prime Minister Pham Minh Chinh had a “brief” meeting with Trump on the sidelines of the Asean gathering, and invited him to visit Vietnam on behalf of the country’s top leader, To Lam.
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Vietnam, an export powerhouse that sells everything from coffee and clothing to engine parts, was initially threatened with a 46% levy by the US. That rate was reduced to 20% in July, the first deal in the region to be announced but one percentage point higher than its neighbours Indonesia, Malaysia, the Philippines, and Thailand.
Still missing in the Vietnam deal, as well as other Southeast Asian agreements, is how the US will determine what it considers “transshipped” goods, which are subject to a 40% tariff in the Vietnam deal.
The uncertainty around the issue has put Vietnam in a tough position, given China is its biggest trading partner and main source of imported components and raw materials.
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According to the US statement, Vietnam has agreed to address issues including recognising US vehicle standards, easing import rules for US medical devices and pharmaceuticals, and fulfilling international intellectual property commitments.
The two countries will also finalise commitments on digital trade, services and investment, it said.
Vietnam has set an ambitious economic growth target of at least 10% next year, despite the global trade uncertainty threatening to weigh on exports and investments flows.
The nation saw its economy advance 8.2% last quarter, the fastest pace in three years, as factories went into overdrive shipping goods to the US before the higher tariffs kicked in. It is aiming for 8.3%-8.5% growth in 2025.
Uploaded by Liza Shireen Koshy
