HSBC Global Viewpoint Under the Banyan Tree - Asia awaits Trump's call on tariffs
Jul 4, 2025
As President Trump's tariff deadline approaches, experts analyze the potential impacts on Asian economies like Vietnam and Japan. Discover how retailers are front-loading imports to beat rising costs, which may lead to a shipment slowdown later on. The conversation dives into the complexities of global supply chains and the strategies companies are using to navigate tariff challenges, including tariff arbitrage. It's a fascinating look at how international trade dynamics are shifting in the face of new economic pressures.
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U.S. Tariffs Impact on Asia
- U.S. tariffs on Vietnam are set at 20%, lower than the initial 46%, but still significant.
- Japan faces potential 35% tariffs, with doubts about a deal before the July 9 deadline.
Vietnam's Tariff Competitiveness
- Vietnam's 20% tariff may be manageable due to low labor costs and economies of scale.
- Competitors facing lower tariffs could disadvantage Vietnam in exports to the U.S.
Vietnam's 40% Tariff on Re-exports
- Vietnam may impose a 40% tariff on Chinese re-exports to the U.S. to block Chinese goods routed through Vietnam.
- The tariff impact depends on how much Chinese components are included in Vietnamese products.