Investment Rating - The report indicates a new 20% tariff on Vietnam's exports to the US, which is a reduction from the previous reciprocal tariff rate of 46% but still significantly higher than the pre-Liberation Day rate of 4.6% [2][3] Core Insights - The US-Vietnam trade deal aims to establish favorable rules of origin and reduce transshipment, which could lead to higher tariffs for other ASEAN economies like Thailand while potentially benefiting India with lower tariffs [2][3][20] - Vietnam's exports to the US account for 29.5% of its total exports and 25.1% of its GDP, indicating a significant economic impact from the new tariff structure [5][6] - The indirect effects of the US tariffs on Vietnam will also impact other Asian economies that supply intermediate products, with Vietnam's exposure estimated at 8.25% of its GDP, while Thailand, Taiwan, and South Korea face lower but still significant impacts [6][7] Summary by Sections Trade Deal Details - The US and Vietnam have agreed on a 20% tariff on Vietnam's exports, which includes various products such as tech, footwear, and agricultural commodities [2][3] - Vietnam is expected to address non-tariff barriers and provide preferential market access for US agricultural products [2][3] Economic Impact - The total export value at risk due to the new tariffs is estimated at 1.7% of Vietnam's GDP, with Taiwan at 0.9%, China at 0.8%, and Thailand and Korea at 0.6-0.7% [7][6] - The report highlights that the higher tariffs will pressure profit margins for exporters and may lead to increased prices for end consumers [5][6] Regional Dynamics - The transshipment clause poses challenges for ASEAN economies, particularly Thailand and Cambodia, which may face higher reciprocal tariff rates [3][20] - The report suggests that India could gain a competitive advantage in sectors like textiles and electronics if it can negotiate lower tariffs [3][20]