The U.S. and Vietnam have launched trade negotiations after President Donald Trump paused the implementation of a 46% tariff on Vietnam’s exports, a move that could bolster the country’s growing tech manufacturing sector.
What Happened: On Thursday, the Vietnamese government announced that it would begin trade talks with the U.S., following the temporary halt of a hefty tariff on Vietnamese goods, reported Reuters.
The 90-day pause, which came after discussions between U.S. Trade Representative Jamieson Greer and Vietnam’s Deputy Prime Minister Ho Duc Phoc, signals a potential shift in the two nations’ economic relations.
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Why It Matters: Vietnam had a $123 billion trade surplus with the U.S. last year, meaning Vietnam exported way more to the U.S. than it imported.
The Southeast Asian nation serves as a vital manufacturing base for major U.S. companies such as Apple Inc. AAPL, Intel Corp INTC, Nvidia Corp NVDA, and Alphabet Inc.’s GOOG GOOGL Google.
These tech giants have been expanding their operations in Vietnam, driven by cost-efficiency, access to skilled labor, and the need to mitigate the risk of higher tariffs on Chinese-made goods.
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Apple, for instance, has been leveraging Vietnam as a key production site for products like MacBooks and AirPods, with suppliers like Foxconn and Luxshare establishing factories in the country. Apple shares are down 18.45% year-to-date, according to data from Benzinga Pro.
Nvidia has also chosen Vietnam as the location for its third global AI research hub, while Google has reportedly shifted its Pixel production to avoid potential tariffs on Chinese imports.
Intel is also producing semiconductor components in Vietnam as part of its broader manufacturing strategy. The company stated last month that its Vietnam operations are central to the IDM 2.0 initiative, employing around 6,000 people in advanced tech roles.
Since launching its assembly and testing facility there, Intel has invested $1.5 billion and generated more than $90 billion in total export value from the site.
Last month, it was reported that Vietnamese Prime Minister Pham Minh Chinh pledged to expedite the licensing process for Elon Musk’s companies, Tesla Inc. TSLA and Starlink, as part of a pilot initiative. Tesla is down 28.23% this year.
Image via Shutterstock
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