The United States will place a lower-than-promised 20% tariff on many Vietnamese exports, Donald Trump said on Wednesday, cooling tensions with its tenth-biggest trading partner days before the U.S. president could raise levies on most imports.

President Donald Trump’s new trade deal with Vietnam sends a clear signal about where US tariffs on Chinese goods might ultimately land, as talks between Washington and Beijing continue following their recent truce.

Under the new deal, US goods into Vietnam will not be taxed while Vietnamese exports will face a 20 per cent US tariff.