"Increasing tax rates on imported goods", "reviewing and adjusting tax rates for some industries", "imposing reciprocal tariffs on countries", successive tax policies issued from the other side of the Atlantic have made not only businesses, supporting units and even state management agencies in a mood of discouragement. an, full of anxiety and somewhat cautious for a bad prospect for Vietnam's economy that could take place at any time. The changes in US tariff and trade policies, especially the increase in tariff and trade remedies since the beginning of President Trump's 2nd term, have put Vietnamese businesses in an urgent need to adjust their business strategies and find solutions. The new direction is both practical and at the same time must be effective so that Vietnamese businesses can calmly respond and overcome the fierce wave called "US tariffs".
Anxious and cautious mood of businesses exporting to the US
Like many other countries that have been subject to tariffs such as China, Canada or Mexico, although not yet a direct target of US tax policies, Vietnam is in great danger of becoming the Trump Administration's "next target" as he seeks fairness. "reciprocity" for the US economy. This possibility is also considered by Mr. Nguyen Huu Nam, Deputy Director of the Vietnam Confederation of Commerce and Industry (VCCI), Ho Chi Minh City Region, to be very likely to happen in reality in the near future. A series of US tariff increase policies on their largest trading partners such as China, Canada, and Mexico show that it is almost only a matter of time before Vietnam becomes the next trading partner to be imposed, when Vietnam is the 8th largest trading partner and 3rd in the top trade deficit of US in 2024[1]. It can be said that, unless the Vietnamese Government takes appropriate steps to reduce tensions and conduct goodwill negotiations that are beneficial to both countries, Vietnam can avoid new tariff "blows" from the United States. In addition, to mitigate risks, Vietnamese businesses should also show transparency, credibility and cooperation in the process of trading with US partners. Especially, active cooperation if there are any trade investigations conducted by the United States with Vietnamese businesses.
In this context, it is also quite understandable for the general mood of many Vietnamese businesses from garments, seafood, leather and footwear, wood, and many other industries are feeling insecure and full of anxiety for their largest export market, the US. It is also from these worries that many businesses are also cautious in coming up with new strategies, especially in expanding factories and recruiting more workers to be able to increase production and increase export output to the US. At this time, almost businesses are in the waiting stage and waiting for a good, clear and stable signal from the US market. This mood of the business has also been confirmed by Ms. Nguyen Thi Nam Tran, Managing Director of SGS Vietnam when sharing with us from the experiences of Ms. Tran and SGS Vietnam in recent times.
Vietnamese businesses seek new support
According to Mr. Nguyen Huu Nam, Deputy Director of VCCI, Ho Chi Minh Region, Vietnamese businesses have reacted very quickly to policy changes from countries with which they have business relations. Therefore, businesses are currently not lacking in information about the new US tariff policy. The evidence is that in recent times, many Vietnamese businesses exporting to the US have come to VCCI for more advice on supporting policies and origin certification services. Compared to the past, Vietnamese export enterprises are interested in three groups of problems that are weighing on enterprises: (1) The increase in production and operating costs due to compliance with new and stricter market standards, (2) The risk of being investigated and imposed trade remedy duties; (3) Pressure to transform according to sustainability standards (ESG) if they do not want to lose market share. Now, since President Trump officially took office, businesses are particularly interested in U.S. tariff policies and responses, as well as support from the government for their manufacturing and export activities. The industries with the most attention are also those that are at risk of being directly affected and the most include: wood, steel, aluminum, textiles, fisheries,...
Solutions from practice: Suggestions from VCCI and SGS Vietnam
In order to respond effectively in the context of too many fluctuations, especially from the increasingly high tariff policy from large and valuable markets such as the United States, Mr. Nam and Ms. Tran from the perspective of experts from the world's leading prestigious support units and Vietnam have given some specific advice such as:
First, businesses invest in traceability systems and supply chain transparency. According to Mr. Nam, Deputy Director of VCCI, building a transparent supply chain is a "vital" factor to maintain the US market. Businesses should apply an integrated ERP system, QR coding, and digital data storage. Establish quality control and traceability processes right from the raw material stage. Pay special attention to products with raw materials imported from China, which are easily suspected of "tax evasion".
Secondly, according to Ms. Nam Tran, SGS Vietnam – emphasized: "Vietnamese enterprises should invest in internal resources by increasing the quality of goods and prestige". In addition to methodical investment in ESG and sustainability standards, businesses should also consider diversifying export markets to avoid dependence.
Thirdly, Mr. Nam from VCCI also recommended that businesses need to actively monitor the tariff policy and trade remedies of the US. These are very important points for businesses to be able to respond to the negative reactions of the US market, when this market investigates trade remedy cases such as anti-dumping, etc anti-subsidy. Businesses should closely monitor and have active cooperation in the investigation process to protect their businesses as well as protect the market for Vietnamese businesses.
Finally, businesses should coordinate with industry associations and build a collective voice. In the context of somewhat unstable and volatile markets, in addition to the support from the State, the timely support and companionship of organizations such as VCCI or professional associations and overseas Vietnamese trade offices are important guidance and companionship channels to help Vietnamese businesses overcome this significant challenge.
Adaptation is vital
The new US tariff policy is not only an immediate barrier but also reflects the trend of restructuring global trade. Vietnamese businesses are forced to shift from passive to proactive. Instead of just thinking about exports, we must think about brand building, internal capacity and sustainable development. That is also the sharing of Mr. Nam and Ms. Tran when talking to The Saigon Times about the long-term development orientation of Vietnamese businesses in the new context.
The above solutions not only help to respond to the current tariff policy but also lay the foundation for a long-term, responsible development strategy and deeper integration into the global value chain of Vietnamese businesses.
Lawyer Nguyen Van Phuc
HM&P Law Firm
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hmplaw.vn
