On Friday morning, President Donald Trump announced that To Lam, the top leader of Vietnam, has shown a readiness to completely eliminate tariffs to mitigate the effects of new U.S. duties on Vietnamese imports. Trump provided details of what he characterized as a “very productive” phone conversation, stating that To Lam indicated Vietnam would reduce tariffs to zero if a trade agreement could be established. This announcement quickly attracted attention from both markets and policymakers, indicating a possible change in trade relations between the two nations amid increasing economic uncertainty.
Trump disclosed the conversation via a social media post, highlighting both the tone and content of the dialogue. He mentioned that he expressed gratitude to To Lam on behalf of the United States and showed interest in arranging a meeting soon to further discussions. These comments came just days after the Trump administration enacted steep tariffs of 46 percent on Vietnamese products, a decision that raised alarms among businesses with substantial manufacturing operations in Vietnam. The proposal that Vietnam might counter by abolishing its own tariffs introduced a new element into the ongoing trade negotiations.
Financial markets responded swiftly to the announcement. Shares of companies dependent on Vietnam for manufacturing surged, reflecting a sense of optimism that trade tensions could diminish. Nike, which manufactures a considerable portion of its products in Vietnam, experienced a share price increase of over four percent following reports of the conversation. Investors seemed encouraged by the prospect that tariffs could be lowered or entirely avoided, which could reduce costs for both companies and consumers while stabilizing supply chains affected by recent trade measures.
The trade developments coincided with new economic data indicating ongoing strength in the U.S. labor market. The Labor Department reported that employers added 228,000 jobs in March, significantly surpassing the 135,000 jobs that economists had anticipated. Although the unemployment rate slightly increased to 4.2 percent, job growth accelerated.
