“SIGNIFICANT DAMAGE”
The US tariffs threaten to “significantly damage” Vietnam’s current growth model, which relies heavily on exports to the United States, said Sayaka Shiba, senior country risk analyst at research firm BMI.
She said that, in the worst-case scenario, Vietnam could suffer a 3 per cent hit to GDP this year.
Trump has claimed the Communist country charges the United States a 90 per cent tariff, a figure based on Vietnam’s trade surplus with the United States, worth US$123.5 billion last year.
Experts believe the new tariffs will hit hardest in sectors such as seafood, garments, footwear, wood, electronics and smartphones.
Major US corporations with manufacturing operations in Vietnam, including Nike and Adidas, are likely to see orders decrease and reductions in revenue, potentially leading to factory downsizing and job losses, Pham Van Dai, a lecturer in economics at Fulbright University Vietnam, told AFP.
Business groups have also called on the Trump administration to delay the imposition of reciprocal tariffs.
The American Chamber of Commerce in Hanoi and the Vietnam Chamber of Commerce and Industry said that they sent a joint letter Saturday to the US commerce secretary expressing “deep concern” over the policy and urging a delay.
Vietnam’s exports rose 10.6 per cent year-on-year in the first quarter, official data showed, increasing significantly from 7.9 per cent growth in the final quarter of 2024.
Industrial production was up 7.8 per cent year-on-year, slowing from an 11.5 per cent expansion in the previous quarter.
Experts believe investors are still holding a “wait and see” mentality amid the uncertainty caused by Trump’s tariffs.
“Now is the worst time for investors to make long-term decisions,” said Dai, adding that they are waiting for “clearer policies from the United States and (other) countries’ responses”.
https://www.channelnewsasia.com/asia/vietnam-seeks-us-tariff-delay-economic-growth-slows-first-quarter-5047966
