MUCH UNCLEAR
There remains much to be worked out in the US-Vietnam tariff deal.
It is not yet clear how Washington will define an illegal transshipment and how much value Vietnam must add to imported products to avoid the 40 per cent tariff.
Sources have said that the US is pushing Vietnam to reduce its reliance on imported components from China, especially for electronic devices.
It is also not clear when the deal is likely to be finalised.
Vietnam’s government decree will introduce stricter procedures to monitor companies that self-certify the origin of the products they trade, increase scrutiny of traded goods with more on-site inspections and increase scrutiny of the issue of certificates of origin, according to an undated draft seen by Reuters.
The draft decree does not currently list penalties, which are expected to be added in revisions or in other legal texts, said a person familiar with the process. The person was not authorised to speak on the matter and declined to be identified.
Vietnam has nearly tripled its exports to the US since the start of the US-China trade war in 2018, when the first Trump administration imposed wide-ranging tariffs on Beijing, pushing some manufacturers to move production south.
But as exports to the US boomed, Vietnam vastly expanded imports from China, with their inflow almost exactly matching the value and swings of exports to the US over the years, each totalling around US$140 billion in 2024, data from the US and Vietnam show.
https://www.channelnewsasia.com/asia/vietnam-plans-new-penalties-illegal-transshipments-us-trade-tariffs-5231176
