China issued a warning on Thursday against trade deals that “hurt third parties,” following US President Donald Trump’s announcement that he had struck an agreement with Vietnam.
“China has always advocated that all parties resolve economic and trade differences through equal dialogue and consultation,” said Chinese foreign ministry spokeswoman Mao Ning. “At the same time, relevant negotiations and agreements should not target or harm the interests of third parties,” she emphasized, clearly indicating Beijing’s concerns about the implications of the new US-Vietnam deal.
The agreement, announced by President Trump on Wednesday, marks the first comprehensive pact he has sealed with an Asian nation. Analysts suggest this deal could serve as a template for Washington’s future negotiations with other countries still seeking trade accords. This development comes less than a week before Trump’s self-imposed July 9 deadline, by which steeper tariffs on US trade partners are set to take effect if agreements are not reached.
Initially, shares in clothing companies and sports equipment manufacturers with significant operations in Vietnam saw a rise following the news. However, these gains later declined sharply after Trump released details, which included continued tariffs that were higher than expected. Under the new agreement, Vietnamese exports to the US will face a 20% tariff, a reduction from the initially threatened 46% but still double the universal 10% tariff. Critically, goods deemed to be “transshipped”—primarily originating from China but routed through Vietnam to avoid tariffs—will be subject to a 40% tariff. In return, Vietnam has agreed to eliminate all tariffs on US imports, opening its market to American goods duty-free.
Trump’s trade adviser, Peter Navarro, has controversially referred to Vietnam as “a colony of China,” asserting that as much as one-third of Vietnamese products are in fact relabeled Chinese goods. This “transshipment” clause in the new deal directly targets such practices.
Beijing’s commerce ministry reiterated its long-standing opposition to US tariffs on Thursday. “China’s position is consistent,” said He Yongqian, spokeswoman for China’s ministry of commerce, during a briefing. “We are happy to see all parties resolve economic and trade differences with the United States through equal consultations, but we firmly oppose any party reaching a deal at the expense of China’s interests.”
The new US-Vietnam agreement underscores the ongoing shift in global supply chains as the US seeks to reduce reliance on China. While it offers immediate tariff relief for Vietnam, the stringent transshipment clause and its enforcement mechanisms could significantly impact companies that moved production to Vietnam to circumvent US tariffs on Chinese goods, adding complexity and uncertainty to international trade dynamics.
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