The United States’ recent announcement of a retaliatory tariff of up to 46% on imports from Vietnam has placed unprecedented pressure on the country’s textile and garment industry—one of Vietnam’s key export sectors to the U.S. market.
According to the General Department of Customs, the U.S. has consistently accounted for over 40% of Vietnam’s total textile and garment export turnover in recent years. The newly imposed tariff severely undermines Vietnam’s price competitiveness, especially when compared to regional rivals like Bangladesh, Indonesia, and India.
In 2024, Vietnam’s total textile and garment export turnover reached USD 16.6 billion, with the U.S. market accounting for a significant share of 38%.
Shrinking Export Space, Rising Costs
Data from the Vietnam Textile and Apparel Association (VITAS) shows that in 2024, Vietnam’s total textile and garment exports reached USD 16.6 billion, with the U.S. market accounting for about 38% of the total. As a result, the U.S. tariff—reaching up to 46%—is creating significant cost burdens and poses a real risk of market share loss.
Many textile and garment enterprises are struggling under the pressure of the retaliatory tariffs imposed by the United States.
Compared to other major textile exporters to the U.S., the tax rate for Vietnam is unusually high: India at 26%, Bangladesh at 37%, and Indonesia at 32%. Vietnam’s share in the U.S. textile and garment import market rose from 12.98% in 2019 to 15.07% in 2024. With the new tariff, this growth momentum is now at risk of slowing or even reversing.
The industry’s heavy reliance on imported raw materials and challenges in meeting rules of origin requirements for preferential tariffs under Free Trade Agreements (FTAs) further complicate Vietnam’s supply chain equation under the new tax regime.
Policy Support Is Not Enough – Businesses Must Proactively Adapt
Deputy Prime Minister Hồ Đức Phớc and U.S. Secretary of Commerce Howard Lutnick discussed the tariff policies currently being imposed by the United States on Vietnam.
In response to the growing pressure, Mr. Truong Van Cam, Vice President and General Secretary of VITAS, proposed four key strategies for businesses in the industry:
Diversify export markets
Vietnamese textile exporters need to reduce dependency on the U.S. and proactively expand into FTA-partner markets such as the EU, Japan, South Korea, and Canada. This not only mitigates trade risks but also leverages tariff preferences under FTAs.
Strengthen supply chain collaboration
Businesses should deepen collaboration with buyers, brands, and raw material suppliers to share risks and maintain long-term partnerships. VITAS also recommends renegotiating contracts to ensure fairer risk-sharing across the value chain.
Increase transparency in raw material sourcing
To meet rules of origin requirements, enterprises must invest in traceability systems and transparent sourcing practices to comply with international standards.
Proactively recommend supportive policies
VITAS has urged the Government to negotiate with the U.S. on product-specific tax classifications and request a temporary 2–3 month suspension of the new tariffs. It also recommends maintaining support measures such as VAT reduction, land rent cuts, corporate tax deferral, and interest rate assistance.
Proactive Sourcing Is No Longer Optional
Ms. Nguyen Thi Phuong Thao, CEO of Garment 10 Corporation, noted that the new U.S. tariffs would undoubtedly increase product costs and reduce Vietnam’s competitiveness in the U.S. market. Without timely solutions, the company could face up to a 10% drop in orders, directly impacting production and cash flow.
Thanks to early recognition of rising trade barriers, particularly for key export sectors like textiles, Garment 10 proactively implemented a dual strategy to diversify both markets and sourcing:
- On the market side, they maintained their U.S. presence while expanding into the EU, Japan, and Australia—markets that demand high quality but offer greater policy stability.
- On the sourcing side, they sought alternative raw material suppliers to reduce reliance on China, especially amid U.S. scrutiny over cotton from Xinjiang.
At the same time, Garment 10 has also invested in developing the domestic market, helping balance international and local demand, reduce external risks, and strengthen long-term brand positioning.
Agility and end-to-end proactivity—from sourcing to market expansion—are now vital to maintain competitiveness in an increasingly volatile global landscape.
Vietnam International Sourcing 2025 – A Strategic Platform for Textile Enterprises
Textiles and garments have always been one of the most sought-after sectors by buyers at the exhibition.
In times of global uncertainty, Vietnam International Sourcing 2025, organized by the Department of International Market Development – Ministry of Industry and Trade, offers a critical opportunity for textile and garment businesses to:
✅ Meet directly with over 350 international buying delegations
✅ Connect with high-quality raw material suppliers
✅ Stay ahead of sourcing trends, technical standards, and logistics requirements
✅ Reshape export strategies within global supply chains
📅 Date: September 4–6, 2025
📍 Venue: SECC, Ho Chi Minh City
🔗 Register now: https://vietnamsourcingexpo.vn/en/register-to-visit/
Source: vnexpress, nhaquanly
