Under Trump Tariffs, ‘Made In Vietnam’ Will Be The New ‘Made In China’

Forbes

For decades, the Southeast Asian nation has opened its doors to major firms like Apple, Samsung and Intel. Now it’s poised to do even bigger business.  Read the full story on Forbes: https://www.forbes.com/sites/cyrusfarivar/2024/11/20/under-trump-tariffs-made-in-vietnam-will-be-the-new-made-in-china/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes, under Trump tariffs,

00:03made-in-Vietnam will be the new made-in-China.

00:08President-elect Donald Trump says his plan to impose heavy tariffs

00:12on goods imported to the U.S. will shrink the federal deficit,

00:15lower food prices, and create more jobs at home.

00:19On the campaign trail in Savannah, Georgia,

00:21he vowed to, quote,

00:23relocate entire industries to the U.S.

00:26In September, he said, quote,

00:28You will see a mass exodus of manufacturing

00:31from China to Pennsylvania, from Korea to North Carolina,

00:34from Germany to right here in Georgia.

00:38However, such reshoring is unlikely to happen,

00:41certainly not at the scale and speed that Trump wants, if ever.

00:46Instead, expect to see one country

00:48as a major beneficiary of Trump's policies, Vietnam.

00:53Jason Miller, a professor of supply chain management

00:56at Michigan State University, told Forbes, quote,

00:59If previously it was made in China,

01:02now it's going to be made in Vietnam.

01:04That production is not coming back to America.

01:08During the previous Trump administration,

01:10major foreign corporations, including Apple, Foxconn,

01:14and Intel, started pivoting to Vietnam

01:17as a way to diversify their manufacturing portfolio.

01:20Just two months ago,

01:21SpaceX announced a $1.5 billion investment in Vietnam, too.

01:26Even the Trump Organization is investing in the country,

01:29with a recently trumpeted $1.5 billion

01:32luxury real estate deal.

01:34And now, the Southeast Asian nation is well-positioned

01:38to benefit even more from the anticipated

01:40anti-China sentiment of the forthcoming administration,

01:43especially if it moves quickly to streamline regulation

01:46so that businesses can move in quickly.

01:50Vietnam has a number of advantages

01:52over other regional rivals like India.

01:55First, as a single-party authoritarian state,

01:57Vietnam can and does set new business-friendly policy quickly.

02:02Additionally, the country is geographically well-positioned.

02:05It already has three of the world's top 50 busiest ports,

02:09and is next door to China,

02:11making trade and logistics between the two countries easier.

02:15Critically, Vietnam also has a free trade agreement

02:17with the European Union,

02:19the only other regional country besides Singapore to have one.

02:23India is currently negotiating such a deal,

02:25which would smooth imports and exports

02:27between the EU and the world's most populous country.

02:31Vietnam is also moving quickly to improve the infrastructure

02:34needed to support large projects,

02:36like the country's new decree earlier this year

02:38that allows companies to buy green energy

02:40from solar power producers,

02:42rather than go through the traditional state power utility.

02:46The move, which makes it easier for companies

02:48to meet their climate targets,

02:50was applauded by Apple,

02:51Samsung, the country's largest foreign investor,

02:54and the United States Embassy in Hanoi.

02:58Trump has repeatedly said in recent months

03:00that he wants to promote American manufacturing

03:02and make foreign-made goods more expensive to import.

03:05He singled out Mexico, as well as China,

03:08saying earlier this month

03:09that he would implement tariffs of between 25% and 100%

03:14on products made south of the border.

03:16Previously, he said that goods made in China

03:18should be hit with a 60% tariff,

03:21while anything manufactured abroad

03:23should have a blanket 20% tariff, including Vietnam.

03:27But the country clearly sees an opportunity for growth.

03:31Anh Nhiap Tron,

03:32a professor of governance at Indiana University

03:35and a former advisor to the Vietnamese prime minister,

03:38told Forbes, quote,

03:39Vietnam could be mildly successful

03:41or it could be hugely successful,

03:43depending on how it facilitates

03:45this foreign direct investment wave.

03:48Tron said he is currently preparing a memo for Hanoi

03:51about how his home country can capitalize

03:53on these strict new trade rules,

03:55as Vietnam bets that a huge influx of foreign capital

03:58will help transform it

04:00into a developed, high-income country by 2045.

04:04At the top of Tron's list

04:05is targeting multinational corporations

04:07that will bring their own ecosystem of suppliers

04:10and focusing on higher-value goods.

04:13He said, quote,

04:14Vietnam should prioritize companies

04:16that will bring other companies to Vietnam.

04:18If you bring Apple,

04:19there are a lot of other suppliers

04:21that want to be close to Apple,

04:22companies that allow Vietnam

04:24to move into a more high-tech sector.

04:26Instead of doing footwear and textiles,

04:28Vietnam should aim for biotechnology

04:30and AI and semiconductors.

04:34For full coverage,

04:35check out Cyrus Farivar's piece on Forbes.com.

04:40This is Kieran Meadows from Forbes.

04:42Thanks for tuning in.

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