Washington Gets at China Through Vietnam

Udumbara Udumbara
Jul 9, 2025 - 10:08 Updated: Jul 9, 2025 - 01:48
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Washington Gets at China Through Vietnam
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Commentary
Washington has kept up what can only be described as relentless pressure on China. In one aspect of this campaign, it imposed 20 percent tariffs on Vietnam but increased them to 40 percent for goods largely made outside the country, which the agreement describes as “transhipped” goods coming through Vietnam.
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In this, the Americans clearly have their eye on China. They want to stop practices in which Chinese businesses use Vietnamese connections to avoid American tariffs. U.S. negotiators note three techniques. In one, Chinese producers send goods first to Vietnam, where they are labeled “Made in Vietnam” and then shipped to the United States.

American negotiators are also claiming that Chinese manufacturers are evading U.S. tariffs by redirecting productive efforts to their operations in Vietnam, which are numerous, and then exporting them to the United States as Vietnamese products. Even when goods are genuinely the product of a Vietnamese company, the Americans note that the finished goods sent to the United States contain so many Chinese components that they might as well be Chinese-made and are accordingly subject to a tariff.

Both Vietnamese companies and the government in Hanoi have expressed sympathy with Washington’s position. Indeed, prominent Vietnamese figures, both in the government and the nation’s business community, welcome the opportunity to move away from Chinese dominance and develop their own products and production facilities. The issue for them is time. Although they can envision a day when they will have their own products and no longer need Chinese components, and are eager for that day to arrive, purely Vietnamese goods for the time being cannot match Chinese costs, volume, or reliability.

In the negotiations currently underway in Washington, the parties are seeking to have the U.S. negotiators allow for a longer period of adjustment. Both the Vietnamese and American sides in the talks are hopeful that a proposed meeting between President Donald Trump and Vietnamese Communist Party leader To Lam can bridge the differences.

Because the negotiations are taking place behind closed doors, there is limited information about additional proposals and counter-proposals. Some discussion has emerged about placing a cap on Chinese components, allowing some, if not all, Vietnamese goods to enter the United States free of high tariffs. Alternatively, some have proposed a scaled tariff schedule based on the amount of Chinese content in each good shipped from Vietnam to the United States. As yet, however, there is nothing definite.

Whether Hanoi and Washington can further refine the tariff arrangements, the message from the Americans to Beijing is the same: Washington is determined to corral communist China’s economic reach and, accordingly, its national ambitions. If these talks with Vietnam have failed to make that aim clear, then it surely has come through in Washington’s efforts to end access to American computer chips, even to U.S. allies operating in China.

This pressure is not solely a result of Trump’s policies. Although he initially gained his tough-on-China reputation by imposing tariffs on Chinese goods in 2018 and 2019, the Biden administration heightened the pressure on China regarding trade. A tough stance against the Chinese regime might be the only truly bipartisan sentiment in Congress. No doubt, Beijing has taken this message on board.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.
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