Vietnam’s exports to the United States have hit a post-pandemic high, further increasing the country’s trade surplus with Washington and increasing the pressure on Vietnamese officials trying to negotiate a reduction in the harsh U.S. tariffs imposed last month.
Citing Vietnamese customs data, Reuters reported yesterday that in April, shipments to the U.S. exceeded $12 billion, a 34 percent increase on a year earlier, and the largest value recorded since the COVID-19 pandemic. It reported that Vietnam’s imports from China also reached a record high last month, exceeding $15 billion for the first time.
The news agency cited industry executives as saying that the figures reflect the efforts of Vietnam-based manufacturers to ramp up exports before a possible tariff hike. Under U.S. President Donald Trump’s recently announced “reciprocal tariff” regime, Vietnam faces a 46 percent tariff on its imports to the U.S. With the imposition of the tariff delayed until July, the two nations are currently engaged in negotiations over ways to rebalance the trade relationship. In the meantime, Vietnam, like the rest of the world, is subject to a 10 percent baseline tariff.
However, these latest trade figures will complicate matters for Vietnamese trade negotiators, exacerbating the very imbalances that are the source of the Trump administration’s concerns. Reuters reported that the surge in Vietnamese exports to the U.S. has inflated the country’s trade surplus with the U.S., which expanded by nearly 25 percent in the four months to April over the same period in 2024, according to Vietnam’s statistics agency.
This largely continues the trend from 2024, where the surplus expanded by nearly a fifth over the previous year, reaching $123.5 billion, the third-largest deficit that the U.S. has with any nation, after China and Mexico.
The figures cited by Reuters reflect the tight connection between Vietnam’s imports from China and its exports to the United States, and the important role that Vietnam plays in China-centered supply chains. China is a key source of many of the raw materials and electronic components that are used by Vietnam-based manufacturers such as Samsung and Nike, for whom the U.S. is a key export market. Reuters reported that Vietnam’s imports of Chinese goods, including components, grew by nearly 31 percent last month from a year earlier.
In recent years, the Vietnamese trade surplus has increased further by the relocation of international firms from China to avoid the tariffs placed on Chinese goods by Trump during his first term. There is also a certain amount of transshipment of Chinese goods via Vietnam, either through outright fraudulent relabeling or through the relocation of Chinese factories to Vietnam.
Where this leaves the ongoing trade talks, the first round of which began in Washington yesterday following a phone call between Vietnamese Trade Minister Nguyen Hong Dien and U.S. Trade Representative Jamieson Greer last month, is unclear. U.S. officials have made clear that they want Vietnam to reduce the trade imbalance and to open its market further to U.S. goods. Based on comments from Trump, the U.S. may also ask that Vietnam curb its economic relationship with China.
Even before Trump’s April 2 tariff announcement, Vietnam had made a number of suggestions on how to reduce its trade surplus, such as purchasing more American liquefied natural gas and aircraft, a pledge that it renewed this week. Vietnamese leaders have since offered to remove all remaining tariffs on U.S. imports, and pledged to clamp down on the fraudulent transshipment of Chinese goods via its territory.
However, as I wrote earlier this week, Vietnamese negotiators are also seeking some concessions in return: recognition of Vietnam as a market economy – a move that the U.S. government decided not to take last year – and the removal of restrictions on high-tech exports, which they argue can help push down the large trade surplus with the United States.
According to a Vietnamese media report, Trade Minister Dien met with U.S. Ambassador Mark Knapper in Hanoi yesterday. During the meeting, he “called for the development of their trade relations in a balanced, long-term, and sustainable manner, in full compliance with Vietnam’s international commitments and without affecting its relationships with other partners.” This suggests that while Vietnam will show flexibility on economic questions, it is unlikely to concede any requests to decouple itself from the Chinese economy.