In a significant step toward strengthening economic ties, Vietnam’s Minister of Industry and Trade Nguyễn Hồng Diên held a pivotal online meeting with United States Trade Representative Jamieson L. Greer on April 24, 2025, to officially launch negotiations on bilateral trade and economic issues. The discussions, which included representatives from Vietnam’s government delegation and the Vietnamese Embassy in the US, come at a critical juncture as both nations navigate a complex landscape of tariffs and trade imbalances, seeking a path to a more balanced and sustainable partnership.
Setting the Stage for Negotiations
The virtual meeting marked the formal beginning of talks aimed at addressing key trade concerns between Vietnam and the US, two nations that have deepened their relationship through a Comprehensive Strategic Partnership. Minister Diên emphasized Vietnam’s commitment to fostering economic and trade relations that are “balanced, stable, sustainable, and effective.” He assured his American counterpart that Vietnamese ministries and agencies stand ready to engage constructively, tackling US concerns while pursuing solutions that benefit both sides through a spirit of shared risks and harmonized interests. 
US Trade Representative Greer reciprocated the optimism, expressing confidence that the negotiations would yield solutions to promote a stable and mutually beneficial economic relationship. Both leaders agreed to maintain regular communication at the head-of-delegation and technical levels to ensure swift progress on specific issues. While the exact scope and timeline of the negotiations remain undisclosed, the commitment to dialogue signals a shared intent to address longstanding trade frictions.
Tariff Tensions and Reciprocal Challenges
The backdrop to these talks is a recent escalation in trade tensions. Earlier in April 2025, US President Donald Trump announced a steep 46 percent ‘reciprocal tariff’ on Vietnamese goods, one of the highest rates imposed on any trading partner. This move has placed significant pressure on Vietnam, a country whose economy relies heavily on exports to the US, particularly in sectors like textiles, electronics, and footwear. The tariffs are part of a broader US policy to address perceived trade imbalances and protect domestic industries, but they risk straining relations with key partners like Vietnam.
In response, Vietnam’s top leader, General Secretary Tô Lâm, reportedly proposed a bold measure during a separate phone call with President Trump. According to sources, Tô Lâm suggested that Vietnam could reduce all tariffs on American goods to zero percent, contingent on the US reciprocating with similar concessions for Vietnamese exports. While this proposal has not been officially confirmed by either government, it underscores Hanoi’s urgency to mitigate the impact of US tariffs and preserve access to one of its largest export markets.
If realized, such a mutual tariff reduction could reshape trade dynamics between the two countries, potentially benefiting Vietnamese exporters and American consumers alike. However, analysts caution that reaching an agreement on zero tariffs may face significant hurdles, given domestic political pressures in the US to maintain protective measures and Vietnam’s need to safeguard its own industries.
A Broader Strategic Context
The trade talks are not merely about economics; they are deeply intertwined with geopolitical considerations. Vietnam and the US have cultivated a Comprehensive Strategic Partnership in recent years, with Hanoi viewing Washington as a critical counterbalance to regional influences, particularly China. Economic cooperation serves as a cornerstone of this partnership, with bilateral trade reaching record levels—Vietnam exported over $120 billion in goods to the US in 2023, while importing approximately $15 billion in return, according to data from the US Census Bureau.
Yet, this trade disparity has long been a point of contention for the US, which has frequently labeled Vietnam as a source of unfair trade practices, including currency manipulation allegations in the past. While Vietnam has taken steps to address these concerns—such as signing agreements to increase transparency in currency policies—the recent tariff imposition suggests that tensions persist. The ongoing negotiations offer an opportunity to resolve these issues, potentially paving the way for a more equitable trade framework.
Beyond tariffs, the talks are expected to cover a range of topics, including intellectual property rights, labor standards, and market access for US agricultural products. Vietnam, for its part, is likely to seek greater investment from American firms in high-tech industries and infrastructure projects, aligning with its broader goal of economic modernization under the Communist Party of Vietnam’s leadership.
Economic Impacts and Domestic Reactions
For Vietnam, the stakes of these negotiations are high. The country’s export-driven economy has benefited immensely from access to the US market, with American consumers driving demand for Vietnamese goods ranging from smartphones to apparel. However, the 46 percent tariff threatens to erode this competitive edge, potentially increasing costs for US importers by millions of dollars and forcing Vietnamese manufacturers to absorb losses or pass on higher prices.
In Hanoi, small and medium-sized enterprises (SMEs) are particularly vulnerable. “We rely on the US for nearly half of our orders” said Tran Minh, a textile factory owner in northern Vietnam. “If these tariffs stay, we may have to cut jobs or find new markets, which isn’t easy.” His sentiment reflects broader concerns among Vietnam’s business community, where many fear that prolonged trade barriers could undo years of economic progress.
On the US side, the tariffs are framed as a means to protect American jobs and reduce the trade deficit. However, critics argue that such measures could backfire, raising costs for US consumers and disrupting supply chains that rely on Vietnamese components, particularly in electronics. American businesses with investments in Vietnam, including major tech firms, have also expressed concern over the potential for retaliatory measures or a cooling of economic ties.
Looking Beyond the Negotiating Table
As negotiations unfold, the path forward remains uncertain. Both Vietnam and the US have much to gain from a successful outcome—Hanoi seeks to preserve its export markets and attract foreign investment, while Washington aims to address trade imbalances without alienating a strategic partner in Southeast Asia. Yet, the specter of domestic politics looms large. In the US, trade policies are often shaped by electoral considerations, with protectionist rhetoric resonating among certain voter bases. In Vietnam, the government must balance economic openness with the need to protect national interests and maintain public support.
Analysts suggest that a compromise could involve phased tariff reductions, coupled with commitments from Vietnam to increase imports of US goods, such as agricultural products and energy resources. Such an arrangement would allow both sides to claim progress without fully dismantling existing trade barriers overnight. Additionally, deeper cooperation on issues like climate-friendly technologies and supply chain resilience could provide a positive narrative, reinforcing the strategic importance of the partnership.
For now, the initiation of formal talks is a promising sign. Regular communication between Minister Diên and Representative Greer, supported by technical teams, suggests a structured approach to problem-solving. However, the road to a comprehensive trade agreement is likely to be long and fraught with challenges, requiring patience and flexibility from both sides.
Regional Implications and Global Watch
The outcome of these negotiations will have ripple effects beyond bilateral relations. Vietnam’s position as a manufacturing hub in Southeast Asia means that shifts in its trade policies with the US could influence regional competitors like Thailand, Indonesia, and Malaysia. If Vietnam secures favorable terms, it may strengthen its appeal as an investment destination, potentially drawing more US firms seeking alternatives to China amid ongoing geopolitical tensions.
Conversely, a failure to resolve tariff disputes could push Vietnam to diversify its export markets, deepening ties with the European Union, Japan, or South Korea—all of which have existing trade agreements with Hanoi. While this diversification aligns with Vietnam’s long-term strategy, it may come at the cost of reduced influence for the US in the region, a concern for policymakers in Washington.
Globally, the Vietnam-US trade talks are being watched as a litmus test for how major powers engage with emerging economies. With trade protectionism on the rise in many parts of the world, the ability of these two nations to forge a mutually beneficial agreement could set a precedent for constructive dialogue over confrontation. For Vietnam, a country that has navigated decades of economic transformation, the negotiations represent not just a chance to address immediate challenges but also an opportunity to cement its role as a key player on the global stage.
As the dialogue progresses, one question lingers: Can Vietnam and the US bridge their differences to build a trade relationship that withstands political and economic pressures? The answer, still unfolding, will shape the future of their partnership for years to come.
