Vietnamese firms tackle US tariffs with smart strategies

The US recently imposed a 20% reciprocal tax on goods originating from Vietnam, a level that presents challenges but remains manageable for domestic enterprises.

Many Vietnamese firms are responding proactively by restructuring operations, standardising production and diversifying export markets to maintain growth momentum amid these new trade barriers.

Nguyen Phuong Lam, Director of the Vietnam Chamber of Commerce and Industry’s Mekong Delta branch, noted that the tariff rate is a significant reduction from the previous 46%. He added that the gap between Vietnam and other Southeast Asian nations is now only around one percentage point.

“Compared with regional countries, a 20% tax is not excessively high and can be considered acceptable. More importantly, Vietnam’s exports to the US have exceeded USD 119 billion, far surpassing many Southeast Asian nations which only reach USD 30-40 billion,” Lam emphasized.

Experts agree this outcome reflects the Government’s effective negotiation efforts. However, enterprises must now adopt both short-term and long-term adaptation strategies to remain competitive.

Many businesses have already taken steps. Minh Phu Seafood Corporation – Hau Giang, which exports shrimp to 50 countries, reported that the US accounted for only 14.7% of its sales, with Japan leading at 24.1%.

General director Le Thi Minh Phu said, “We hope the Government will continue negotiations for further tax reductions. At the same time, we have expanded into other potential markets to maintain stable growth.”

In agriculture, Cuu Long Orchard JSC General Director Le Van Dong said: “The US market values quality over quantity. The decisive factor is not the tariff rate but competitiveness through product quality. We are targeting the premium segment, where customers prioritize health and branding.”

Technology companies are also adapting swiftly. Deputy Director of VNPT Technology’s business center Tran Duc Hoa outlined four solutions: optimizing supply chains, boosting localization, diversifying markets and developing high-tech products to ease pricing pressures.

Principal country economist of the Asian Development Bank in Vietnam Nguyen Ba Hung highlighted that domestic reforms, ranging from institutional improvements to business environment upgrades, could be undertaken immediately to enhance competitiveness.

From an investment perspective, he added that the current tariff gap gives Vietnam an advantage over China, making it a more attractive destination for international capital flows.

Source:  https://vietfishmagazine.com/