The Donald Trump administration has increased pressure on Vietnam to reduce its economic dependence on China.
According to Bloomberg on June 4 (local time), Howard Lutnick, U.S. Secretary of Commerce, stated that even if Vietnam were to eliminate all tariffs and trade barriers on American goods, the United States would not remove its tariffs on Vietnamese products. Secretary Lutnick argued, "Vietnam buys $9 billion worth of goods from China, marks up the price, and then sends them to us," adding, "So, this is merely a channel for goods to reach us from China."
Previously, at the end of last month, after concluding the second round of trade negotiations with Vietnam, the United States reportedly sent a list of demands, including reducing the use of Chinese materials and components by Vietnamese companies and strengthening production and supply chain management. According to a source, if Vietnam accepts the U.S. request to effectively reduce its dependence on China, it could pose a serious threat to the Vietnamese economy. This is because Vietnam's manufacturing sector is closely integrated with the vast supply chain of neighboring China.
After the Trump administration announced in early April that it would impose a super-high reciprocal tariff of 46% on Vietnamese goods, the Vietnamese government began cracking down on illegal transshipment, such as disguising Chinese products as Vietnamese. In response to U.S. demands to strengthen intellectual property (IP) protection, Vietnam has also started cracking down on the sale of counterfeit goods and illegal software imported from China and other regions. However, since it is difficult for the Vietnamese government to intervene in cases where foreign companies in Vietnam rely on Chinese supply chains, rather than domestic firms, no clear solution is in sight.
Amid these developments, Vietnam's Ministry of Industry and Trade issued a statement on this day, announcing that it had delivered its response to U.S. demands in the trade negotiations to the Trump administration. The ministry stated that Nguyen Hong Dien, Vietnam's chief negotiator, and Jamison Greer, the U.S. Trade Representative (USTR), agreed to accelerate the negotiation process and do their utmost to achieve the best possible outcome in the third round of talks.
Minister Dien and Representative Greer are scheduled to hold the third round of negotiations before the end of next week.
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