China has sharply criticized the recent US-Vietnam trade agreement, expressing fears that President Donald Trump is using his so-called “liberation day” tariff negotiations with third countries to restrain China’s export-driven economy.
The deal, announced on Wednesday, lowers tariffs on Vietnamese exports to the US from a threatened 46 percent to 20 percent but retains a 40 percent tariff on “trans-shipping” — a measure widely understood to target Chinese goods re-exported through Vietnam.
Beijing’s Ministry of Foreign Affairs emphasized on Thursday that trade agreements should not harm the interests of “third parties,” implicitly referring to China. “Relevant negotiations and agreements should not target or undermine the interests of any third party,” the ministry stated.
The US-Vietnam deal is the second recent trade pact viewed as directly aimed at China following a US-UK agreement in May, which introduced stringent security rules on steel and pharmaceuticals, widely seen as an attempt to exclude China from British supply chains.
Multiple countries are rushing to finalize trade deals with the US ahead of the July 9 deadline, when Trump’s suspended “reciprocal” tariffs are set to take effect. For Vietnam, one of the world’s most trade-dependent economies with 30 percent of exports going to the US, avoiding tariffs was a critical priority.
However, analysts note the agreement comes with significant concessions for Hanoi. The maintained 40 percent levy on trans-shipped goods aims to block Chinese products routed through Vietnam to circumvent existing US duties.
“The new US-Vietnam deal is not just about trade; it is clearly aimed at China… it is meant to block the flow of Chinese goods that often move through Vietnam to dodge existing US duties,” said Julien Chaisse, an expert in international economic law at City University of Hong Kong.
This move fits into a broader US strategy to forge bilateral deals with countries bordering China, tightening economic ties while curbing Beijing’s supply chain influence.
During the US-China trade war, many Southeast Asian nations benefited as alternative manufacturing hubs for Chinese companies seeking to avoid tariffs — a “China plus one” strategy that has led to large trade surpluses with the US.
“The key lesson for other countries from this deal, and that agreed previously by the UK, is that they will be expected to curtail some trade with China,” wrote Capital Economics’ chief Asia economist Mark Williams and senior Asia economist Gareth Leather. “That will be seen as a provocation in Beijing, particularly if similar conditions are included in other forthcoming deals.”
China’s commerce ministry reiterated its firm opposition to trade deals that come at its expense, pledging to defend its rights and interests.
Experts warn that deals like the one with Vietnam could undermine ongoing US-China trade negotiations. Although Trump recently claimed a tariff truce with Beijing, concerns persist over Chinese export restrictions on rare-earth metals and US controls on advanced technologies like semiconductors.
Adam Sitkoff, executive director of the American Chamber of Commerce in Hanoi, welcomed Vietnam’s deal as a positive step ahead of the looming deadline, avoiding the fate of countries like Japan, which Trump recently threatened with higher tariffs.
Yet Sitkoff highlighted lingering uncertainties over the deal’s details. Key questions remain about how the 40 percent trans-shipment tariff will be enforced, given the difficulty of tracking such goods. The Trump administration has not clarified its definition of trans-shipment, though it has made the issue a priority in talks with Vietnam and other Southeast Asian nations.
Additionally, it remains unclear whether the 20 percent tariff is final or if it will be added to existing levies, and which products might be subject to the 40 percent charge.
“Do the 40 percent tariffs on ‘trans-shipped’ goods apply to any product that contains content from another nation? The answers to these questions can be the difference between celebrating or crying,” Sitkoff said.
