In the outskirts of Ho Chi Minh City, Dony Garment factory workers are bracing for the impact of Donald Trump’s proposed 46% trade tariff on Vietnam. With orders rushing to American clients, the looming uncertainty has spurred frantic efforts to mitigate potential losses. Workers like Do Thi Anh express concerns about reduced earnings affecting their families, emphasizing the importance of proactive business strategies.

The factory’s forward-thinking approach, diversifying markets post-COVID, contrasts with others heavily reliant on American exports. Pham Quang Anh, the optimistic owner, underscores the risks of market dependence and the need for strategic adjustments. Amidst the uncertainty, the debate on China’s influence in Vietnam’s manufacturing landscape adds complexity to the situation.

Luke Treloar from KPMG in Vietnam offers a cautiously optimistic view, highlighting the potential for Vietnam to position itself as a reliable manufacturing partner. However, the delicate balance between Chinese interests and Vietnamese negotiations remains a critical factor. Analysts stress the significance of tariff levels, with anything above 10-20% posing significant challenges to the industry’s viability.

As Vietnam navigates this pivotal moment, characterized by both threats and opportunities, the outcome hinges on effective negotiation and adaptability. The looming tariff threat underscores the need for resilience and strategic decision-making in the face of evolving global trade dynamics.