China, Vietnam build trade links to weather US tariff pressure

China and Vietnam, two major manufacturing nations, are strengthening their transport infrastructure and trade ties to counter pressure from the US. Last year, both countries set aside political differences to deepen their economic cooperation, according to analysts. Jack Nguyen, CEO of the business services platform Ascentium, stated that the China-Vietnam connectivity story is transitioning from simple border trade to a more integrated manufacturing, logistics, tourism, and supply chain corridor.

Vietnam's economy is heavily reliant on manufactured exports, including to the US, Asia, and Europe. China supplies raw materials to Vietnamese plants, while Vietnam ships electronics and machinery to China. In a bid to mitigate the impact of US tariff increases since April 2025, Vietnam has unveiled a US$320 billion investment plan for transport and logistics development through 2030, reported Swiss private banking group J. Safra Sarasin.

American tariffs and non-tariff barriers have created uncertainty, prompting Vietnam and China to deepen their transport, supply chain, and trade links. This year, the two nations have made progress on three railway lines that will enhance freight shipments and passenger trips across their 1,297km (806 mile) land border. Vietnam allocated $3.36 billion in August to construct the standard-gauge Lao Cai-Hanoi-Haiphong line, which aims to synchronize tracks in both countries by 2030.

In March, China and Vietnam agreed to a technical assistance project for standardizing the gauge of the Haiphong-Ha Long-Mong Cai railway line. The Vietnamese Ministry of Construction is finalizing an investment outline and pre-feasibility study for a US$5 billion Hanoi-Dong Dang railway project due to start in 2035. These railway projects aim to reduce congestion at highway border crossings, boost tourism, and create more efficient supply-chain corridors.

Currently, two border crossings utilize older infrastructure and narrow-gauge systems, leading to infrequent railway trips. To facilitate trade further, Hong Kong Air Cargo Terminals Ltd will extend its SuperLink China Direct service to Vietnam, offering Vietnamese enterprises a more convenient and cost-effective logistics and air-road intermodal solution.

Vietnam saw a record 8.6 million passenger seats on China-Vietnam flights this year, up from 7.7 million last year, and received around 5.3 million Chinese visitors in the first half of this year, a more than 40% year-on-year increase.