Three informed sources disclosed to Reuters that the United States is urging Vietnam in tariff negotiations to ensure that the equipment assembled in Vietnam and exported to the United States contains less Chinese technology.
According to a source familiar with the negotiations, Vietnam has been organizing meetings with local businesses to increase the supply of Vietnamese parts. The companies have shown a willingness to cooperate but have also warned that they need time and technology to achieve this goal.
President Trump announced global tariffs on April 2, imposing a 46% reciprocal tariff on Vietnam. However, on April 9, Trump announced a 90-day suspension of such tariffs on these countries to allow time to reach a trade agreement. Following this, trade negotiations between the United States and Vietnam began, with Vietnam hoping to make concessions to persuade the U.S. to lift the 46% tariff. The United States being Vietnam’s largest market, high tariffs could severely damage Vietnam’s economic growth as the country relies on exports to the U.S. and significant investments from foreign manufacturers.
One source revealed that Vietnam has been asked by the U.S. to “reduce reliance on high-tech products from China.” The source added, “This is part of the supply chain restructuring, which in turn will reduce U.S. reliance on Chinese components.”
Another source stated that the ultimate goal is to accelerate the decoupling of U.S. and Chinese high technology while enhancing Vietnam’s industrial capabilities. Using virtual reality equipment as an example, the source highlighted that products assembled in Vietnam overly rely on Chinese technology.
Due to the confidential nature of these discussions, all sources have refused to disclose their identities. It is currently unknown whether the U.S. has presented specific targets, such as setting limits on the Chinese content in ‘Made in Vietnam’ goods or applying different tariff rates based on the amount of Chinese content in Vietnamese products.
Vietnam is a hub for tech manufacturing for companies like Apple and Samsung, which typically rely on Chinese-made components. Companies like Meta, the parent company of Facebook, and Google also have contractors in Vietnam producing products such as virtual reality headsets and smartphones. Apple, Samsung, and other companies have not responded to requests for comments from Reuters. The Vietnamese Ministry of Trade has also not provided any comments.
With the 90-day deadline for the suspension of reciprocal tariffs approaching on July 8, the timing and scope of a potential agreement between the U.S. and Vietnam remain uncertain.
All sources emphasized that while the U.S. has made broader requests to Vietnam to reduce reliance on China, addressing the issue of high Chinese tech content in exported products is a top priority.
Last year, China exported approximately $44 billion worth of tech products to Vietnam, including electronic components, computers, and mobile phones, accounting for around 30% of its total exports to Vietnam. Vietnam exported $33 billion worth of tech products to the U.S., making up 28% of its exports to the U.S. According to Vietnamese customs data, trade volumes for these categories have been on the rise this year. Vietnam had a trade surplus with the U.S. amounting to $123.5 billion last year.
The U.S. also hopes that Vietnam will crack down on the practice of labeling Chinese goods as “Made in Vietnam” for shipment to the U.S., which the Trump administration claims helps China evade U.S. tariffs. The Vietnamese government is working to address the U.S.’s concerns on this issue.
The Vietnamese Ministry of Trade has issued a new regulation to strengthen efforts against exporters illegally diverting goods to the U.S. and other destinations to prevent Chinese companies from using Vietnam as a “production-reshipping” hub. The Ministry of Trade announced on Sunday, June 15, that progress was made during the third round of talks held in Washington last week, but key issues remain unresolved.
Officials informed Reuters that Vietnam’s Communist Party General Secretary, Nguyen Phu Trong, intends to meet President Trump in the U.S., possibly at the end of June. The specific dates for this trip have not been announced yet. Both the White House and the Vietnamese Ministry of Foreign Affairs have not responded to requests for comments.