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TRADE UPDATE MAY 2025: SPEED UP NEGOTIATIONS BEFORE THE 90-DAY DEADLINE

The effect of rushing export orders continued to be evident in the trade results for May 2025.
Exports by domestic enterprises significantly declined compared to the previous month, while the trade activities of FDI enterprises continued to accelerate.
The top three export growth categories in May 2025 were electronics, agricultural and aquatic products, and machinery and equipment.
Imports of raw materials for production gradually decreased in the textile and garment sector. In contrast, imports of raw materials for electronics and machinery equipment remained at high levels.
Exports to the U.S. market continued to grow exceptionally, surpassing the growth rate of exports to non-U.S. markets. Concurrently, the trade surplus with the U.S. continued to expand.
The rush for export orders before the tariff deadline was particularly strong for toys, electronics, chemicals, agricultural products, and paper. However, with the U.S. imposing a 50% tariff on aluminum and steel, steel exports bucked the overall trend of growth.
Vietnam has undergone three official rounds of negotiations with U.S. representatives regarding tariffs. The announced results indicate positive progress, though details remain undisclosed, with just over half a month left before the 90-day tariff suspension period ends.
Currently, Vietnam, along with 17 key trade partners, is working toward signing agreements with the U.S. Recent remarks by U.S. Treasury Secretary Scott Bessent suggest that the U.S. may be flexible with tariff deadlines for countries demonstrating “good faith” in negotiations.
The latest developments in U.S.-China trade negotiations indicate that the U.S. will impose a 10% reciprocal tariff on China, with the total effective tariff increase on Chinese goods reaching around 29%. According to Bloomberg, Vietnam is seeking a tariff in the range of 20-25%, corresponding to an additional effective tariff increase of 15-18%.