Some observers have predicted that the move would fuel doubts about US reliability and even nudge Vietnam closer towards China economically, but others said Hanoi would continue its policy of hedging between the two superpowers.
“For Vietnam’s export-driven economy, the immediate economic hit is very damaging – both in trade and in foreign direct investment inflow,” Nguyen Khac Giang, a visiting fellow from the Vietnam Studies Programme at Singapore’s ISEAS-Yusof Ishak Institute, said.
“But the longer-term damage could be worse: a breakdown of trust painstakingly rebuilt over decades between Washington and Hanoi. Trust, once broken, isn’t easily mended.”
The United States is Vietnam’s largest export market – with the value of US$142 billion, or nearly 30 per cent of its gross domestic product – and the steep tariffs appeared to take it by surprise. It recorded a trade surplus of US$123 billion with the US.
