In Vietnam, exporters tune out Trump’s tariff riffs – and rush to replace the US

The US president’s latest comments are a good sign for Vietnam’s vast textile industry. But businesses no longer believe a word he says

Garment manufacturers across China and Vietnam breathed a small sigh of relief on Sunday, after US President Donald Trump told reporters that the United States was “not looking to make sneakers and T-shirts”.

But few plan to change their plans based on the president’s comments. After weeks of wild swings in US tariff policies, they have learned that Trump could soon change his tune once again.

Businesses in China and Vietnam – the world’s two largest clothing export hubs – are still facing huge uncertainty, with both countries midway through a 90-day pause in US tariffs and trying to strike a deal with Washington to prevent another painful rise in duties.

In that context, recent comments by US officials appear to be good news for the region’s garment exporters, as they indicate Trump’s drive to make American manufacturing great again will not extend to low-margin sectors.

“We’re not looking to make sneakers and T-shirts,” Trump said on Sunday. “We can do that very well in other locations. We are looking to do chips and computers and lots of other things, and tanks and ships.”

Vietnam’s textile exporters are, for now, breathing a little easierDan Martin, business adviser in Vietnam

His statement followed earlier remarks by US Treasury Secretary Scott Bessent, who said that America should focus on reshoring precision manufacturing rather than the textile industry.

“Vietnam’s textile exporters are, for now, breathing a little easier,” said Dan Martin, an international business adviser with the consultancy Dezan Shira & Associates. “In an increasingly rare moment of industrial-policy realism, the administration seems to have accepted that not every factory needs to fly an American flag.”

However, Vietnam’s US$44 billion garment industry has already had to weather significant turbulence – and local businesses are well aware that Trump-era trade policy often favours political optics over policy consistency, Martin added.

“Until reassuring words are backed by concrete policy, they are unlikely to revise their risk assessments or their contingency plans,” he said.

After the fire and fury of “Liberation Day”, which saw Trump raise tariffs on dozens of countries including China and Vietnam on April 2, the US has taken steps to de-escalate its global trade war in recent weeks.

In mid-April, Washington paused most of its so-called “reciprocal” tariffs for 90 days, which saw the duties on Vietnam’s imports reduce from 46 per cent to just 10 per cent.

A month later, America and China also agreed to scale back tariffs on each other’s products for the next 90 days, with the US decreasing its levies on Chinese goods from a peak of 145 per cent to 30 per cent, while China reduced its duties on US goods from 125 per cent to 10 per cent.

But the future trajectory of US tariff policies remains unclear. Unless Beijing and Hanoi strike deals with Washington within the next few weeks, the tariffs will skyrocket back to their original levels once the 90-day windows expire.

Zhou, the owner of a bedding and curtains factory in eastern China’s Zhejiang province, has taken little comfort from Trump’s latest comments.

“US policy changes by the day, and that’s the worst kind of uncertainty for doing business,” said Zhou, who gave only her surname for privacy reasons.

“Today, they might say there’s no need to reshore textile manufacturing, but what if they change their minds tomorrow? At this point, none of us in this industry dare to bet on the US market again.”

Zhou has been supplying US clients since 2014, but she has been steadily moving to reduce her exposure to the American market for years. Trump’s recent tariff hikes have accelerated that effort, she said, with the US now accounting for less than a quarter for her sales.

Winnie Lam, general secretary to the board of the Hong Kong Business Association Vietnam, told the Post that many Hong Kong and mainland investors in Vietnam were taking a similar approach.

Trump’s comments only offer “temporary relief” to exporters in Vietnam, Lam said, and many companies are “taking definitive action about diversification and putting less and less weight on the US market”.

“The world is their oyster, so to speak, now that they have to take the brave step towards other markets, which was on the map anyway and now is accelerating,” Lam said. “The textile industry is saying the US has no way for them to return.”

Last year, nearly 17 per cent of China’s textile and apparel exports went to the US, while the figure for Vietnam was significantly higher, at 38 per cent.

Vietnam has been pushing hard to convince Washington to scale back its tariffs. Hanoi has already offered to slash its own duties on US imports, and cracked down on Chinese goods being transshipped through its territory to evade US tariffs aimed at China.

Last week, the Trump Organization also broke ground on a new US$1.5 billion golf course in northern Vietnam, with Vietnamese leaders stating publicly that they had expedited approval processes for the project.

Ralf Matthaes, managing director at market intelligence firm IFM Research in Ho Chi Minh City, said that Trump’s recent comments on the textile industry were “not expected”, but he noted that Vietnam had effectively given Trump “a blank cheque on a golf course”.

Vietnam’s clampdown on Chinese goods “posing” as Vietnamese products made sense, Matthaes said, as the trend had been “good for China, but bad for Vietnam” due to the way it had put Hanoi in Washington’s crosshairs.

Foreign capital has been flooding into Vietnam this year, Viet Nam News reported on Monday.

Foreign direct investment is up 40 per cent so far this year compared with the same period in 2024, with more than US$1.5 billion of the new capital coming from China – the second biggest foreign source after Singapore.