Vietnam’s Record Trade Surplus with the U.S. Raises Concerns Over Trump’s Tariff Targeting

Vietnam's Trade Surplus with the U.S. Reaches All-Time High, Heightening Fears of Being the Next Target in Trump's Tariff War

Vietnam's trade surplus with the United States surged to a record high in 2024, fueling concerns that it could soon become the next target in President Donald Trump’s trade war. According to the U.S. Department of Commerce, the surplus reached a staggering $123.5 billion (approximately 178 trillion won), marking an 18.1% increase from the previous year. This growth is the highest ever recorded, putting Vietnam among the top countries with the largest trade surpluses against the U.S., following China, the European Union, and Mexico.

Despite the trade surplus ranking fourth globally, the speed of Vietnam’s growth outpaced all other countries, surpassing China’s 5.8%, the EU’s 12.9%, and Mexico’s 12.7%. This rapid increase in surplus has raised alarms that Vietnam could be the next target for Trump's tariff measures, following similar moves against China, Mexico, and the EU.

Trump’s stance on trade deficits has been clear, with significant tariffs imposed on countries like China and Mexico during his first term, citing national security concerns and the need to rectify what he viewed as unfair trade practices. Although President Trump has not directly addressed Vietnam in his recent speeches, trade policy experts believe the country could be in his crosshairs as the U.S. continues to focus on reducing its trade imbalance.

Vietnam, alongside Mexico, was one of the countries that benefited from the U.S.-China trade war, as Chinese companies moved their production facilities to these nations to avoid high tariffs, exporting goods to the U.S. through these alternative routes. However, experts note that Vietnam may not face the same level of scrutiny as China or Mexico due to the lack of national security issues or controversial factors like immigration and drug trade, which have been cited in tariff decisions against other countries.

Market analysts have pointed out that it would be challenging for the Trump administration to present a convincing case that Vietnam poses a national security threat to the U.S. compared to China or Mexico. Furthermore, Vietnam's role in the global supply chain, particularly as a hub for multinational corporations such as Samsung and Intel, means it is unlikely to reduce exports significantly. Instead, the Vietnamese government is looking for ways to address the trade imbalance, such as increasing imports of U.S. goods, including Boeing aircraft and other advanced technologies.

In a bid to alleviate concerns, Vietnamese Prime Minister Pham Minh Chinh announced plans to implement solutions to reduce the country's massive trade surplus with the U.S. This includes reaffirming commitments to purchase U.S.-made airplanes and other high-tech products, signaling a desire for a more balanced trade relationship. Additionally, Deputy Foreign Minister Do Hung Viet expressed Vietnam’s support for a harmonious and sustainable trade relationship with the U.S., indicating plans to import more U.S. liquefied natural gas (LNG) and military equipment, as well as AI-related semiconductor products.

Analysts also suggest that Vietnam could increase its imports of American agricultural products like soybeans, cotton, and meat by lowering tariffs on these items. However, with major multinational companies like Samsung Electronics and Intel leading the charge in Vietnam’s export growth, reducing exports may not be a viable option. As a result, the focus will likely be on finding ways to balance the trade by increasing the purchase of U.S. goods, particularly in the high-tech and agricultural sectors.

Vietnam's efforts to address the growing trade surplus with the U.S. reflect its proactive approach to managing its trade relationships with major global economies, while also positioning itself as a key player in the broader regional and global supply chain.