By Cadys Wang    Photo：CANVA

Global trade tensions have escalated, making the "China plus one" strategy no longer viable for businesses. As nations impose higher import tariffs, companies exporting to the U.S., China, or Europe face mounting challenges. Moreover, there is a growing risk of additional non-tariff barriers.

As tariff measures and punitive actions escalate between major economies, rising product prices seem unavoidable. However, many economic experts have cautioned that an increase in product prices, along with a decline in consumer purchasing power, could adversely affect any country with a highly open economy that relies significantly on exports and foreign direct investment.

The U.S. government, particularly under Trump, commonly uses tariffs as a bargaining tool in trade relations. Countries with large trade deficits with the U.S., such as Vietnam, may be targeted.

During Trump’s first presidency, he highlighted that Vietnam—a communist country—emerged as the primary beneficiary after the U.S. imposed heavy tariffs on mainland China.

The "Section 301" investigation confirmed that Vietnam had violated fair trade practices - Chinese setting up factories in Vietnam to import products for re-export or simply repackage Chinese products and export them stateside under the 'Made in Vietnam' label to avoid tariffs.

If the gap between U.S. exports and imports continues to widen, Vietnam may face greater scrutiny. This concern extends beyond Vietnam—all countries that were initially chosen as "China plus one" alternatives need to diversify their export markets.

However, 2025 is likely to bring significant economic and political changes. Countries cannot immediately balance their trade with the U.S., especially under Trump's potential second-term policies.

Local firms should focus on enhancing transparency in product origin certification while leveraging free trade agreements to reduce U.S. market dependence. We should also develop strategies to expand into alternative markets like the EU, India, the Middle East, and Africa.

In conclusion, the key challenges will include managing raw material supplies and increasing logistics costs.

Businesses must prepare for trade hurdles when exporting to the U.S., with the electronics sector particularly vulnerable to potential new export tariffs or non-tariff barriers.

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