Vietnam has emerged as a number one strategic hedger in a worldwide order present process main energy transition. In different phrases, it has engaged in “repeated, various, sustained, and complementary actions to have interaction with all main powers with out reaching a proper alliance with any and with out restrictions on potential actions with others.”
On April 2, 2025, Vietnam’s technique confronted an enormous check: on so-called “Liberation Day,” U.S. President Donald Trump focused Vietnam with a punishing 46 p.c tariff, accusing the nation of conniving with China on transshipment and treating the USA unfairly. Totaling $123.5 billion, the U.S. commerce deficit with Vietnam was the third largest after its deficits with China and Mexico. It attracted consideration.
On April 14-15, Chinese language President Xi Jinping was in Hanoi, pressuring Vietnam to not give in an excessive amount of to the USA. With stress from either side, the way forward for Vietnam as a connector nation in world provide chains was below nice stress.
Quick ahead 16 months, and Vietnam has not simply survived within the dysfunction; it has thrived.
Total exports elevated by 17 p.c in 2025 total (and exports to the U.S. elevated 28 p.c, to $153 billion). Within the first seven months of 2026, the U.S. imported $104.7 billion value of products from Vietnam, a 23 p.c year-on-year improve. Vietnam’s GDP development price reached 8 p.c in 2025 and eight.18 p.c within the first half of 2026, regardless of commerce tensions and the Iran struggle, and in distinction to the prediction of 5.6 p.c for 2025 made by the IMF Outlook in September 2025.
To perform this financial feat, Vietnam didn’t throw its lot in with one nice energy or be a part of an alliance. In actual fact, it doubled down in its strategic habits as a hedger. Vietnam is deeply dedicated, for strategic and historic causes, to reply to uncertainty and world geopolitical tensions by hedging.
Amazingly, it has labored to date. Vietnam appears notably in a position to achieve hedging and resist the formidable pressures of three nice powers – not solely China and the U.S., however Russia – because of three key benefits. First, Vietnam’s essential geopolitical place signifies that no nice energy can let one other dominate, forcing them to indicate some forbearance.
Second, Vietnam has constructed a place of structural indispensability in provide chains because the recipient of investments linked to companies’ “China plus one” or out-of-China technique. For a lot of Western companies, Vietnam is difficult to interchange. Vietnam has additionally began to diversify its markets.
Third, Vietnam has proven tactical genius in dealing with every of the three nice powers and their leaders.
With the USA, Vietnam negotiated intensely and instantly, the day after the tariffs had been introduced. Getting forward of ASEAN solidarity, it engaged intensely with Washington and on July 2, 2025, turned the third nation to achieve a cope with the Trump administration, after the UK and China. The deal lowered U.S. tariffs to twenty p.c (and 40 p.c on transshipments, though the time period will not be properly outlined) and dedicated Vietnam to across-the-board opening to U.S. exports. These circumstances had been reconfirmed in a formal White Home Reality Sheet in October. However, crucially, Vietnam refused to simply accept poison capsule restrictions and commitments to comply with U.S. sanctions on China, not like Malaysia and Cambodia on the time.
Even the lowered tariffs led to painful provide chain changes and automation, however Vietnam’s efforts mitigated the worst of the harm.
On the identical time, Vietnam went out of its technique to sign opening to Trump’s personal priorities. In Might 2025, the Ministry of Finance led the largest-ever Vietnamese company delegation to the Choose USA honest in Maryland. They enlisted some U.S. company help in heading off additional tariffs. The identical month, on Might 16-21, Vietnam fast-tracked a $1.5 billion actual property funding by the Trump Group, with occasions attended by Eric Trump.
On February 18-20, 2026, Secretary Basic of the Communist Celebration of Vietnam To Lam traveled to the USA to attend the opening ceremony of the Trump Board of Peace for Gaza and signal a flurry of cooperation agreements.
But, Vietnam wouldn’t cross sure boundaries with the U.S. Hanoi’s willingness to compromise didn’t forestall a powerful push to renew the struggle legacy remediation program, which had been disrupted by the dismantlement of USAID. America gave in – Secretary of Protection Pete Hegseth got here to Hanoi and dedicated one other $130 million to the fund, however he couldn’t persuade Vietnam to signal an arms deal. Vietnam additionally refused to take measures that might antagonize China or Russia and refused to hitch the Pax Silica initiative.
On the identical time, Vietnam underwent intensified engagement with China. As talked about earlier, Chinese language chief Xi Jinping visited Hanoi in April 2025 and Vietnamese chief To Lam reciprocated with a go to to Beijing on April 14-17, 2026, resulting in the conclusion of a joint assertion and 32 cooperation agreements. Overseas ministers additionally visited one another, in addition to Vietnam’s former prime minister and president. The elevated cooperation resulted in new MOUs between Chinese language and Vietnamese media that embrace content material co-production phrases and the promotion of people-to-people ties. When it comes to sheer variety of agreements, Vietnam signed extra with China than the USA over the previous 12 months and half.
On AI governance, Minister Vu Hai Quan led a delegation to the Shanghai World AI Convention, however Vietnam refused to hitch the 29 founding members of the World AI Cooperation Group (WAICO) created by China, not like Indonesia and Malaysia. Right here once more, Vietnam saved to its hedging playbook, refusing to cross a U.S. crimson line.
Vietnam equally intensified its lengthy relationship with Russia. No fewer than seven Vietnamese leaders have visited Russia since January 2025, together with prime chief To Lam on Might 9-12, 2025. Throughout that go to, the 2 leaders signed a serious joint assertion that accelerated vitality cooperation. In March 2026, Vietnam reached a nuclear cope with Rosatom to fast-track the constructing of 1 nuclear reactor in Khan Hoa province, leaving Japanese, French, Korean, and U.S. corporations disillusioned. Vietnam and Russia often focus on maritime points, with Basic Phan Van Giang’s go to to Moscow in Might 2025 providing Vietnam some help within the South China Sea.
Over the previous 18 months, Vietnam additionally upgraded and intensified its relations and financial engagement with Japan, India, South Korea, Australia, New Zealand, the U.Ok., France, and the EU. In actual fact, since January 2025, Vietnam has deepened its strategic partnerships with current companions, whereas including six complete strategic companions (the U.Ok., the EU, Indonesia, New Zealand, Singapore, and Thailand), 9 new strategic companions, and two new complete companions.
In sum, Vietnam has managed to date to do properly within the midst of a commerce struggle, geopolitical tensions, and world uncertainty, all by the mastery of the artwork of hedging. This artwork is a dangerous one over time, with numerous obligatory changes. The query stays whether or not Vietnam will handle to leap all of the hoops forward.