Vietnam Signs Trade Deal With US Despite China’s Warnings, More Countries May Follow: Experts
Udumbara
After the United States and Vietnam signed a trade deal, Beijing again issued a warning of retaliation to other countries preparing to sign similar agreements with Washington, as the White House’s July 9 deadline for trade deals approaches.
Transshipments refer to products from China and other countries being rerouted through Vietnam and then exported to the United States to evade higher tariffs.
Vietnam’s largest import partner is China, and its main export destination is the United States.
The Chinese regime issued similar warnings in late June and in April.
The deal with Vietnam is the third such trade agreement the United States has signed, following deals with the United Kingdom and China, as U.S. trading partners race to reach an agreement before a July 9 deadline set by the Trump administration to avoid higher tariffs.
Although it has already signed a trade agreement with the United States, Beijing remains wary of other countries signing deals that could shut down China’s transshipment practices and exclude it from a reliable global supply chain.
Taiwanese economist Edward Huang told the Epoch Times on July 3 that the world is paying attention to the U.S.–Vietnam trade deal “because everyone knows that Vietnam is China’s most important transit point for its transshipment practice.”
‘Global Norm’
What scares the Chinese Communist Party (CCP) is the symbolic effect of Vietnam signing a two-tiered trade deal with the United States, which will become a new global norm, Huang said.“For example, the trade deals between the United States and the UK will be the model for the European Union. Countries with similar industrial structures to Vietnam will also use Vietnam’s deal as a model to negotiate with the United States, which will become a new rule for international trade,” Huang said.
Taiwanese macroeconomist Henry Wu agreed. He told The Epoch Times on July 3 that like Vietnam, Cambodia, Madagascar, and Lesotho in Africa, all have had high tariffs imposed by the United States because of their involvement in transshipment.
“This time, the United States wants to use Vietnam as an example to seal this loophole, and that’s why the Chinese regime responded strongly, but it won’t work,” he said.
.
A Shenzhen merchant, who spoke anonymously due to safety concerns, told The Epoch Times in recent days that as the United States stepped up its tracking and investigation of Chinese products, it became increasingly difficult for Chinese products to be shipped to the United States through third countries.
“Customs in Vietnam, South Korea, and Malaysia are doing their best to block Chinese products. As of June, this channel [of exports] has become increasingly unworkable,” the merchant said.
U.S. President Donald Trump said on July 1 that the United States could reach a trade agreement with India to reduce market access restrictions for U.S. companies in India.
Trump told reporters aboard Air Force One, “Right now, India doesn’t accept anybody in. I think India is going to do that, if they do that, we’re going to have a deal for less, much less tariffs.”
On July 1, Treasury Secretary Scott Bessent told Fox News that the United States and India are nearing a deal.
“We are very close with India,” Bessent said.
If the agreement is successfully finalized, India will be able to avoid the 26 percent reciprocal tariff that will take effect on July 9.
The U.S.–EU trade negotiations are also underway. China has called on the bloc to “respect each other’s core interests.”
Wu said that the CCP’s attempt won’t work and it has no leverage on the EU to stop it from striking a deal with the United States.
“From a macro perspective, China needs the U.S. and European markets to absorb its production capacity,” Wu said.
Wu added that he believes the EU will sign a similar trade deal with the United States as the UK, “as the EU has a huge trade surplus with the United States.”
