Vietnam’s economic growth slows in Q1 before tariffs

Data from the Vietnam Statistics Office showed on Sunday that Vietnam’s economic growth slowed in the first quarter, ahead of challenges the export-dependent economy will face in the coming months due to heavy trade tariffs imposed by the United States.

The Southeast Asian nation’s gross domestic product (GDP) rose to 6.93% in the first three months of the year compared to the same period last year, slowing from 7.55% growth in the quarter ending in December.

Vietnamese Prime Minister Pham Minh Chinh said that President Trump’s tariffs did not change the government’s target of at least 8% growth this year.

To achieve this, growth in the remaining quarters would need to rise by between 8.2% and 8.4%.

The Vietnamese economy relies heavily on exports and foreign investment in the manufacturing sector and could come under pressure after President Trump announced a 46% tariff on Vietnamese exports to the United States. The most affected sectors will be clothing, footwear, electronics, and smartphones.

The United States was Vietnam’s largest importer in the first quarter, and Vietnam’s trade surplus with the United States rose 22.1% year-on-year to $27.3 billion.