In a dramatic escalation of global trade tensions, former U.S. President Donald Trump has announced plans to impose sweeping tariffs on imports from Vietnam, targeting goods primarily produced by Chinese manufacturers that had relocated there. Dubbed the “Liberation Day” tariffs, this policy would increase duties on Vietnamese imports to the United States by a staggering 46%, shaking confidence across Southeast Asia’s manufacturing sector.

Disruption Hits Immediately

Although the tariffs are only in the proposal stage, their announcement has already created chaos on the ground. Numerous U.S. buyers have canceled orders from Vietnamese factories, leading to an operational freeze across multiple industries, particularly those dominated by Chinese capital and ownership.

Manufacturers are now in limbo, unsure of how to proceed amid growing uncertainty. Chinese business owners who previously fled tariffs by shifting operations to Vietnam are once again being pushed to the brink, with few clear alternatives.

A Reversal of Post-2018 Strategy

The current situation reflects a painful reversal of a strategic pivot that began in 2018. In response to Trump’s initial tariffs on China, many Chinese companies moved to Vietnam — drawn by its lower labor costs, political stability, and favorable trade position under the Regional Comprehensive Economic Partnership (RCEP). Vietnam quickly became a haven for sectors like furniture, electronics, and textiles.

Now, with the U.S. threatening similar tariffs on Vietnamese goods, the logic of that move is being thrown into question.

Key Product Categories at Risk

The impact of the proposed tariffs extends across a wide array of product categories. Below is a table summarizing the most vulnerable sectors:

Product Category	Reason for Risk
Electronics	Major shift from China to Vietnam post-2018; includes phones, components, gadgets.
Furniture	High concentration of Chinese factories; attracted by low labor costs.
Textiles & Apparel	Key export sector in Vietnam; vulnerable due to its Chinese-backed supply chains.
Consumer Goods	Encompasses various Chinese-made products now assembled or finished in Vietnam.
Machinery & Equipment	Includes specific machinery categories made by Chinese firms in Vietnamese plants.

Voices from the Ground

Factory owners like Jayson Wu, who operates a large furniture facility in Hanoi, are now questioning their next move. “If tariffs hit Vietnam too, where do we go next? There’s no clear path anymore,” he says.

The sense of geopolitical whiplash is shared across the region. With rising labor costs in Southeast Asia and unstable trade policy from the West, the calculus that once made Vietnam an attractive alternative is rapidly eroding.

Global Trade at a Crossroads

These developments are reigniting fears of a global trade war. For Southeast Asia — a region that has benefited from being an alternative manufacturing base — the uncertainty may trigger broader economic consequences.

Businesses now face a crucial question: how to navigate an increasingly protectionist global economy when both origin and proxy manufacturing countries are under tariff threat?