The U.S. Supreme Court’s recent decision to invalidate some of U.S. President Donald Trump’s tariffs (and Trump's subsequent set of new tariffs) is the latest chapter in a yearlong tale of backtracks and “chaos,” disorienting American trading partners as they seek trade deals with Washington.
After the court’s decision, Trump said that he would impose a new “global” tariff of 10 per cent. A White House official then said Washington is working to increase the rate to 15 per cent.
Vietnam as a case study
For countries previously facing tariffs of more than 10 per cent, this week’s developments could spell good news. Vietnam, for one, could emerge as a net beneficiary of the revised tariff structure, benefiting from a relative improvement in export competitiveness.
In July, the U.S. lowered its tariffs on Vietnamese goods from 40 per cent to 20 per cent following negotiations (and Vietnamese concessions). Hanoi, now subject to a lower tariff, is unlikely to tear up this original agreement, preferring instead to wait for clarification.
Much remains unclear surrounding the validity of deals negotiated under the previous tariff rates. As the New York Times noted, “after the ruling, [Trump] insisted that many of the [trade] deals would stand, although even he acknowledged that some might not.”
Muddying the waters further, U.S. Trade Representative Jamieson Greer said that rates on U.S. imports from countries such as Malaysia and Cambodia would remain higher than the “global” tariff rates ordered by Trump last week.
In 2024, the U.S.’s third-largest goods trade deficit, totalling US$123.5 billion, was with Vietnam.
