BGA Vietnam Managing Director Nguyen Viet Ha wrote an update to clients on the latest development of trade negotiations between Vietnam and the United States.

This update is the latest in a series highlighting new developments in Vietnam’s trade space following U.S. President Donald Trump’s announcement of “reciprocal tariffs” in early April. BGA tariff trackers provide an analysis of negotiations, new agreements, government and business engagements and policy responses to keep clients abreast of the evolving trade landscape and enable informed, proactive decision-making

Context

  • Vietnam’s Minister of Industry and Trade Nguyen Hong Dien engaged in an online negotiation with U.S. Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer June 19. Their discussion focused on addressing key outstanding issues of the potential trade agreement between the two countries. Dien emphasized Vietnam’s commitment to collaborating with the United States in developing nondiscriminatory, harmonized and practical rules of origin that align with global supply chains. He requested that Washington consider Vietnam’s interests, including reciprocal tariffs and market access for key Vietnamese exports.
  • Lutnick and Greer acknowledged Vietnam’s efforts and goodwill in addressing U.S. concerns. They indicated that these efforts would enable Washington to consider appropriate reciprocal tariffs suitable for Vietnam’s circumstances. They reaffirmed the U.S. dedication to achieve a mutually beneficial agreement and committed to send necessary documents for further discussions.
  • Vietnamese leaders are hopeful of concluding the trade agreement before July 9 and await confirmation of a high-level visit to Washington, D.C.

Significance

  • Vietnam has joined the BRICS grouping of countries, highlighting its effort to diversify economic ties amid global uncertainties. The Vietnamese Ministry of Foreign Affairs spokesperson said that this aligns with Vietnam’s policy of independence, self-reliance, multilateralization and diversification. Vietnam is ready to cooperate with BRICS members and the international community to promote trade, investment, infrastructure and scientific and technological advancements, contributing to sustainable development and addressing global challenges.
  • The National Assembly passed a resolution June 17 to extend the 2 percent value-added tax reduction to the end of 2026. The resolution broadens the scope of eligible sectors to include transportation, logistics, goods and information technology services. The policy is intended to stimulate socioeconomic growth, targeting a minimum growth rate of 8 percent in 2025. It also lays the groundwork to achieve double-digit growth during the 2026-2030 period, despite ongoing global uncertainties.
  • The United States announced plans to extend tariffs on Chinese goods for 90 more days past the August 10 deadline. This decision follows recent negotiations in London and highlights ongoing tensions over unresolved issues like China’s export restrictions on rare earth magnets and the U.S. controls on advanced artificial intelligence chips to China.
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Implications

  • Macroeconomic: During the question-and-answer session before the National Assembly June 20, Standing Deputy Prime Minister Nguyen Hoa Binh said Vietnam’s GDP growth is projected to reach approximately 7.6 percent in the second quarter and around 7.3 percent for the first half of the year. He emphasized that this performance provides a crucial foundation to accelerate economic momentum in the second half and achieve the full-year growth target of 8 percent.
  • Export Impact: Exporters are encountering additional difficulties due to rising logistic costs as the July tariff deadline nears. According to the Ministry of Industry and Trade, transportation costs to the United States have surged from US$1,850 USD to $2,950 per container for West Coast seaports and from around $2,000 to nearly $5,000 per container for East Coast seaports. Alongside tariffs, these high logistics costs could increase export expenses.
  • Stock Market: Experts have cautioned that June may remain volatile due to the nearing conclusion of global trade talks and the full-scale conflict between Israel and Iran in which the United States is now directly involved. Short-term market pullbacks are likely, though rebounds are also possible. Domestically, investor sentiment remains cautious as Vietnam-U.S. tariff negotiations show encouraging signs, but outcomes are still uncertain. In this context, optimism surrounding Vietnam’s economic outlook and the potential for a favorable resolution to tariff talks could help stabilize the market, but full-fledged war between Iran and Israel involving the United States sets the stage for slower growth in the coming months.

We will continue to keep you updated on developments in Vietnam. If you have any comments or questions, please contact BGA Vietnam Managing Director Nguyen Viet Ha at vietha@bowergroupasia.com.

Best regards,

BGA Vietnam Team

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Managing Director

Ha is a highly respected Vietnamese lawyer, with special expertise in financial transactions, mergers and acquisitions, as well as general business, trade and investment-related issues. Before joining BGA as managing director for Vietnam, Ha managed the Vietnam operations of BrooksBowerAsia for three years. She built and led the Vietnam team and serviced clients in various sectors ranging from energy and ICT to healthcare, logistics and consumer production. Ha practiced law in Vietnam in the 1990s, providing legal advice and consulting services to Fortune 500 clients. She also participated in drafting a number of laws and regulations, including the Foreign Investment ... Read More