Trump announces preliminary US trade deal with Vietnam, pauses tariffs for further talks

With just seven days remaining until the July 9 U.S. tariff deadline, Vietnam has secured a favorable trade deal with the United States. On Wednesday, President Donald Trump announced that the two nations have reached an agreement under which Vietnamese imports into the U.S. will face a 20% tariff.

In a post on Truth Social, Trump said the deal would open Vietnamese markets to American goods without any tariffs. As part of the agreement, Vietnam has also pledged to impose a 40% tariff on products that originate in other countries but are routed through Vietnam before being exported to the U.S.

Earlier, Trump had imposed a hefty 46% tariff on Vietnam, which would have impacted the supply chain of various products.

Under the latest deal, Vietnamese goods entering the US will now face a 20% tariff, while American products exported to Vietnam will be exempt from any tariffs. Additionally, Vietnam agreed to a 40% tariff on goods transshipped through its territory—a measure aimed at curbing the rerouting of products, particularly from China, to avoid higher US duties. This new rate is notably lower than the 46% tariff Trump had initially proposed in April, prompted by Vietnam’s significant trade surplus with the US.

Trump noted that the agreement was finalised following a conversation with To Lam, the General Secretary of Vietnam’s Communist Party.

In his Truth Social post announcing the deal, he offered few specifics but promised further details would be shared soon. The announcement comes just days before a 90-day suspension on many of Trump’s proposed reciprocal tariffs was due to lapse on July 9.

Here’s the full Trump post:

It is my Great Honor to announce that I have just made a Trade Deal with the Socialist Republic of Vietnam after speaking with To Lam, the Highly Respected General Secretary of the Communist Party of Vietnam. It will be a Great Deal of Cooperation between our two Countries. The Terms are that Vietnam will pay the United States a 20% Tariff on any and all goods sent into our Territory, and a 40% Tariff on any Transshipping. In return, Vietnam will do something that they have never done before, give the United States of America TOTAL ACCESS to their Markets for Trade. In other words, they will “OPEN THEIR MARKET TO THE UNITED STATES,” meaning that, we will be able to sell our product into Vietnam at ZERO Tariff. It is my opinion that the SUV or, as it is sometimes referred to, Large Engine Vehicle, which does so well in the United States, will be a wonderful addition to the various product lines within Vietnam. Dealing with General Secretary To Lam, which I did personally, was an absolute pleasure. Thank you for your attention to this matter!

Trump has indicated he might either disregard or alter the looming deadline for reinstating higher reciprocal tariffs. The current 90-day pause, introduced in early April, temporarily reduced tariffs for almost all countries to a uniform 10%, providing time for negotiations with the U.S.

Vietnam, whose exports to the U.S. accounted for about 30% of its GDP last year, faced significant risk from the potential return of steeper US tariffs. Vietnam could have taken an almost 2 per cent hit to its economy had the 46% tariff rate been imposed, economists had warned earlier.

Trump’s July 9 deadline has returned to the spotlight in recent weeks as several countries continue to face hurdles in finalizing trade deals. Earlier this week, Trump declared that talks with Japan had stalled, warning that he would impose tariffs of “30%, 35%, or whatever the number is that we determine.” Significantly, those proposed rates exceed the earlier 24% “Liberation Day” tariff level.

As the deadline nears, the Trump administration has finalised updated trade agreements only with China and the United Kingdom, though officials maintain that deals with several other nations are close.