US imposes 46% tax: A push for Vietnam to promote a proactive economy

(VTC News) - The US's imposition of a 46% tax on Vietnamese goods creates many challenges but is also an opportunity for Vietnam's economy to transform into a proactive, creative and sustainable economy.

Opportunity to diversify export markets

According to Mr. Nguyen Quang Huy - CEO of the Faculty of Finance and Banking (Nguyen Trai University), regardless of the final outcome of the US imposing a 46% tax on Vietnamese goods, Vietnam will certainly see more clearly the importance of diversifying its export markets. Being too dependent on a market like the US will make Vietnam vulnerable to changes in this country's trade policy.

Therefore, the Government and businesses will change their strategies, promoting exports to other markets such as the EU, Japan, South Korea and ASEAN countries. Participation in free trade agreements such as the EVFTA (Vietnam - European Union Free Trade Agreement) or RCEP (Regional Comprehensive Economic Partnership Agreement) will create new opportunities and help reduce dependence on the US market.

Accordingly, Vietnam will not only “expand” but also “renew” traditional markets, through upgrading standards, quality, and brands. Exports will be promoted with the “Southward – Westward” strategy with markets in the Middle East, South Asia, Africa, and Latin America - markets with great potential but not yet adequately exploited.

" Each import-export enterprise and especially policy-making agencies need to manage well the list of export and import markets, reasonably disperse risks, and invest in an early warning system for geopolitical and trade risks.

At the same time, build multi-layered, multi-level response scenarios, from the micro-enterprise level to the national macro-level. When an incident occurs, flexible response mechanisms can be immediately activated to protect the core interests of businesses and the economy ," Mr. Huy emphasized.

Opportunity for Vietnam to diversify export markets. (Photo: Ministry of Industry and Trade ).

Sharing the same view, economic expert Dr. Nguyen Tri Hieu said that the US imposing a 46% tax on Vietnamese goods will open up opportunities to more strongly change many issues of Vietnam's economy.

In the short term, Vietnam needs to quickly have a strategy to diversify export markets, exploiting potential markets such as Europe (EVFTA), Asia, Africa and Latin America through trade promotion.

In the long term, it is necessary to improve national competitiveness by investing in infrastructure, human resources, R&D and innovation. At the same time, it is necessary to reduce over-reliance on certain industries.

“ In the trade sector, we need to have contingency strategies and increase resilience. For example, if the US market encounters problems, we will have potential alternative markets and timely information for businesses to proactively redirect their business. At the same time, we need to build different response scenarios for each specific situation ,” said Mr. Hieu.

According to him, Vietnam needs to have a clear national industrial development strategy, focusing on industries with potential and competitive advantages, while encouraging innovation and digital transformation throughout the economy.

Meanwhile, many experts emphasize the role of the domestic market. Associate Professor, Dr. National Assembly Delegate Tran Hoang Ngan (Ho Chi Minh City Delegation) said: “ To limit the impact of the world market, we need to pay attention to the domestic market with more than 100 million people, because this is an attractive, active market, helping the economy to be stable and sustainable .”

National Assembly Delegate Nguyen Quang Huan (Binh Duong delegation) - Chairman of the Board of Directors of Halcom Vietnam Joint Stock Company, Vice Chairman of the Vietnam Association of Private Entrepreneurs - cited that in sustainably developed countries, the proportion of GDP growth in the domestic market is also very sustainable and will limit dependence on foreign markets.

According to Mr. Huan, to do this, businesses themselves must also focus on the domestic market and improve the quality of their products. Vietnam has more than 100 million people, which is certainly a large potential market that many countries dream of. Therefore, businesses need to focus on research and exploitation.

Moving from manufacturing to building a global brand

Mr. Nguyen Quang Huy analyzed that the US's imposition of high tariffs on Vietnamese goods will also create an opportunity for Vietnam to transform from a processing economy to an innovative - digital - green nation.

Accordingly, Vietnam will accelerate the process from primary processing to deep processing and refining. At the same time, it will transform the strengths of agricultural products, textiles, and seafood into high-end processed brands with high technology and creativity, escaping the trap of "processing - primitive - vulnerable", and moving to "refined - added value - global brand".

In addition, according to Mr. Huy, this is also an opportunity for Vietnam to promote digital transformation, high technology and greening throughout the production and logistics chain. From there, it is possible to export high technology, deeply processed agricultural products, green fashion, ESG-standard seafood, and especially build national brands with global value.

" We are at the intersection of crisis and opportunity. A strong country is not one that does not encounter storms, but one that knows how to steer the boat well in the storms, to go out to the open sea, " Mr. Huy emphasized.

In the FDI sector, Mr. Nguyen Quang Thuan, Chairman of FiinGroup, said that this is an opportunity for Vietnam to review and improve the quality of FDI capital flows, focusing on FDI capital with high technology content.

Moving from manufacturing to global branding.

In fact, during President Donald Trump’s previous term, the US-China trade war triggered capital flows to Vietnam, but mainly Chinese capital. This country leads in the quantity of FDI into Vietnam but the overall quality is not high.

Therefore, it is time for Vietnam to focus on attracting only high-quality FDI with high technology content, participating in the global value chain. This is a “golden” opportunity for the Government to take more drastic measures, so that Vietnam can do what it wants, not attract FDI regardless.

“ Tariff incentives should also be reviewed and differentiated more clearly instead of being equalized so that all FDIs receive the same incentives. In short, we must be more determined in attracting high-quality FDI capital flows.

Foreign investors must also understand that they benefit a lot when investing in Vietnam. Electricity prices for production are cheap, tax incentives are large. Therefore, they must share risks and not just keep the benefits for themselves, ” said Mr. Thuan.

Associate Professor, Dr. Ngo Tri Long, an economist, also analyzed that Vietnam is making efforts to shift from a manufacturing model to a model based on design, branding and creativity. Currently, the proportion of Vietnamese branded goods accounts for less than 10% of total export turnover; while industries such as textiles, garments and footwear are still mainly hired labor with low added value (15-20%).

The target by 2030 is to have at least 20% of self-designed and branded export products. Priority will be given to potential industries such as processed agricultural products, food, high-end textiles, and consumer electronics.

" It is very likely that this process will be accelerated after the US tax policy ," Mr. Long optimistically commented.

Moving from reactive to proactive adaptation

Expert Ngo Tri Long also emphasized that in the context of the global economy with many uncertainties, restructuring export activities is no longer an option, but has become an urgent requirement to increase adaptability and enhance resilience for the Vietnamese economy.

Therefore, market diversification has been clearly promoted in recent times and will be even stronger after this "shock".

We are at the intersection of crisis and opportunity. A strong nation is not one that does not encounter storms, but one that knows how to steer the ship well amid storms, to reach the open sea.

Mr. Nguyen Quang Huy

According to the Ministry of Industry and Trade, in 2024, export turnover to India will increase by 12.5%, to Africa by 9.3%, and to Latin America by 8.1% compared to the previous year. ASEAN and Middle Eastern markets also recorded positive growth. This is a testament to the efforts of Vietnamese export enterprises to expand markets, reduce dependence, and increase adaptability.

Not only expanding its market, Vietnam is also upgrading its product standards to meet increasingly high requirements on environment, labor and technology. Green, clean and socially responsible exports are no longer just slogans but have been materialized by many businesses through actions.

In addition, businesses do not stop at processing, but have begun to participate in design, branding and technology application in products.

In 2024, high-tech exports will reach more than 125 billion USD, accounting for about 45% of total turnover, showing a strong shift in the value chain. Many items such as electronics, components, medical equipment, and fashion products with Vietnamese brands have appeared in demanding markets such as the EU and North America, recording revenue growth of 15-20%.

“ By 2024, nearly 40% of textile and garment exporting enterprises will have switched to using recycled materials or have environmental certification; the seafood industry will also increase traceability and meet standards such as ASC and BAP to maintain market share in the EU and Japan,” Mr. Long cited.

According to Mr. Long, with the above innovations being promoted, Vietnam's economy will shift from passively responding to market fluctuations to proactively adapting - from markets, products to approaches. This is a solid foundation to maintain sustainable and long-term export growth momentum.

“ Tariff barriers from the US are not only a challenge but also an opportunity for Vietnam to transform. This is the golden time to restructure exports in a sustainable way, increase value and master the supply chain. Success requires close coordination between the State, enterprises, associations and research and training facilities, ” Mr. Long emphasized.

Nguyen Yen - Thanh Lam - Pham Duy

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