US business groups urge trade chief to forgo Vietnam tariffs

The U.S.’s biggest business organizations in areas from food to fashion asked the nation’s trade chief to refrain from resorting to tariffs as a remedy in its trade disputes with Vietnam.

“If the administration has concerns about elements of the U.S. trading relationship with Vietnam, then engagement is required—not more tariffs,” 76 groups including the U.S. Chamber of Commerce, the National Retail Federation and the Internet Association—whose members include Amazon.com Inc. and Alphabet Inc.’s Google—said Wednesday in a letter to U.S. Trade Representative Katherine Tai.

The USTR has been investigating imports of timber from Vietnam that it suspects are illegally harvested or traded, while the U.S. has also been considering whether to move forward on imposing tariffs over currency actions. In January, it labeled Hanoi’s currency actions as unreasonable, paving the way for punitive tariffs under section 301 of the 1974 Trade Act. The U.S. has until October to decide on whether to impose duties.

The U.S. is Vietnam’s biggest export market, with the value of shipments doubling over the past five years. Meanwhile, Hanoi is Washington’s 13th-largest goods-trading partner.

The trade associations argue there’s insufficient evidence that Vietnam has engaged in illicit activities on these fronts, and said the decision would undermine the relationship with a valued partner.

Vietnam has emerged as a “trustworthy alternative to China” in recent years, with imports of both raw materials and industrial products being key inputs for U.S. manufacturers. “Tariffs on these products would undermine U.S. manufacturers’ competitiveness.”