“Live well, live expensively”: Tariff orders, the story of livelihood and the problem of growth

On 2 April, President Trump unveiled a 46 per cent tariff on Vietnamese imports, to be enforced just a week later. Framed as part of his “Fair and Reciprocal Plan,” the move targets countries perceived to have lopsided trade relations with the US. Vietnam’s US$123.5 billion trade surplus with the US in 2024, up nearly 20 per cent year-on-year, along with accusations of rerouting Chinese goods through Vietnam to dodge existing US tariffs, provided the justification. The market’s response was immediate and stark: the VN-Index shed 80 points (a 6.2 per cent drop) in April alone, while American companies like Wayfair and Nike saw their shares slump by 12 per cent and more than 6 per cent, respectively. In just four days, from 5 to 8 April, Vietnamese exporters in Binh Duong reported contract cancellations totalling $708 million.

To President Trump and his advisers, the tariffs are a question of justice. White House official Peter Navarro described them not only as a corrective to the trade deficit but as a tool to reshape the global rules of commerce and production. Yet the ripple effects have been swift and far-reaching, upending supply chains and impacting much more than the economy alone.

For Vietnam’s textile industry, the new tariffs strike a severe blow. The United States remains its largest export destination, accounting for 44 per cent of the sector’s total revenue. Mr Pham Van Viet, Chairman of the Board at Viet Thang Jean, voiced his concern that the current 16 per cent tax rate his company faces may climb as high as 62 per cent when additional reciprocal duties are factored in. With the US market absorbing 40 per cent of the company’s output, Mr Viet admitted, “Maintaining the market is a difficult problem.”

Mr Truong Van Cam, Vice President of the Vietnam Textile and Apparel Association, noted that profit margins in the industry are already narrow. Competition with regional players is intense, and he acknowledged that the revised tariff levels would strip Vietnamese products of any advantage over rivals in China, India or Bangladesh.

It isn’t only Vietnamese manufacturers who are feeling the strain, global brands are too. Nike, which sources half of its production from Vietnam, may be forced to increase prices or absorb losses. Other companies, such as Deckers Brands and American Eagle, are facing similarly grim prospects. For smaller manufacturers, without the financial muscle to adapt, the blow is more acute. In Dong Nai, a garment factory owner reported a 30 per cent drop in orders this April, leaving him no choice but to cut shifts and lay off staff.

The wooden furniture sector is proving just as exposed. With exports to the US valued at $8.8 billion in 2024, Vietnamese producers are bracing for cost increases that American retailers may be unwilling or unable to absorb. Nguyen Liem, speaking on behalf of the Binh Duong Wood Association, warned of significant repercussions. “The maximum tax rate the wood industry can tolerate is 10 per cent. Anything higher could reduce competitiveness by 30–40 per cent,” he explained.

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Across the Pacific, American households are already feeling the impact. Kentucky Governor Andy Beshear has estimated that President Trump’s new tariffs could cost the average family an extra $4,700 a year. A Vietnamese silk dress once priced at $500 could now reach $700, with tariffs compounding at every stage. A dining table once sold on Wayfair for $1,000 might now list for $1,100. For affluent buyers, the increase may be a nuisance; for the middle class, it begins to challenge aspirations and lifestyles.

But price rises are only one dimension of the fallout. Vietnam offers an infrastructure foundation, a trained and cost-effective workforce, and reliable supply chains that cannot be easily replicated elsewhere. Though American firms might consider shifting operations, such transitions are rarely swift or cheap. In the meantime, shortages and inflated costs remain a real threat.

Beneath it all, the subtler loss may be one of variety and individuality. The refined, the artisanal, the distinctive, these risk being replaced by cheaper, standardised alternatives. The result could be a slow erosion of aesthetic richness in daily life.

In the face of economic shock, Vietnam responded swiftly. General Secretary To Lam, during a phone call with President Trump on 4 April, affirmed Vietnam’s willingness to negotiate and reduce US import tariffs to zero. Prime Minister Pham Minh Chinh dispatched the Minister of Industry and Trade as a special envoy to Washington to co-chair the Trade and Investment Framework Agreement (TIFA) dialogue. Simultaneously, Vietnam Customs increased scrutiny of input materials to prevent foreign goods from being relabelled for export to the US.

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The 90-day suspension of tariffs has opened the way for negotiation, yet tensions remain high and outcomes uncertain. In parallel, Vietnam is working to broaden its export markets, aiming to reduce reliance on the US.

Globally, Vietnam is not alone. Garment producers in Bangladesh and Cambodia are facing US tariff rates of 37 per cent and 49 per cent, respectively. These disruptions could trigger a realignment in global supply chains, with countries such as Mexico, India, or Egypt potentially standing to gain. For Vietnamese exporters, the moment is one of strategic uncertainty caught between geopolitical shifts and evolving US domestic policy.

Beauty has long been a human pursuit; a means of elevating the everyday, of crafting a sense of identity. Yet Trump’s tariffs lay bare how exposed that pursuit is to political forces. On one side of the world, factory workers in Vietnam; on the other, American homeowners, both joined in appreciation of a shared product, now find themselves divided by a wall of import duties.

American consumers must now choose: pay more for elegance or accept a return to simplicity. But for Vietnam, the cost runs deeper. It is measured in jobs lost, livelihoods disrupted, and the narrowing of future growth. Living beautifully, it seems, has never come at a higher price.

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