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TRADE UPDATE APRIL 2025: TRADE TENSIONS EASE AND IMPLICATIONS FOR VIETNAM

Trade activity in April 2025 accelerated significantly, as export orders were boosted by the 90-day tariff suspension period.
By industry, electronics and machinery recorded the highest growth in both exports and imports.
Facing tariff pressures, exports to the US continued to post strong growth (+34.2% YoY in April 2025), nearly twice the rate of export growth to non-US markets.
The de-escalation of the trade war, marked by the first agreement between the US and the UK and easing tensions between the US and China, brings several implications for Vietnam’s trade outlook:
In the short term, Vietnamese exporters are likely to ramp up production as risks remain tilted towards the imposition of tariffs above 10% after the 90-day grace period expires. For Vietnam, this 90-day window ends on July 8, 2025, while for China, the deadline is August 12, 2025.
The 10% tariff rate on UK imports after recent negotiations signals that this may also serve as the baseline rate that the US will maintain for other trading partners. Currently, the average import tariff in the US stands at 13.1%, down from 22.8% prior to the US–China agreement, but still significantly higher than the end-2024 level of 2.3%.
The US–UK trade agreement suggests that reciprocal tariffs may be less significant than the details of concessions each side is willing to make in strategic sectors, and the extent to which non-tariff barriers are relaxed for US exporters.
The China plus one strategy may or may not regain momentum for Vietnam. The outcome of US–China negotiations could open up opportunities for Vietnam to secure a 10% base tariff following bilateral talks. However, the risk of Vietnam facing higher reciprocal tariffs "relative to other countries" remains a key downside, especially given the complex nature of ongoing negotiations.