Vietnam is already one of the countries with the largest trade surplus with the United States

Sep 09, 2019  |  by CT
According to the analysis of the Vietnam Cotton & Spinning Association, although the United States imposes tariffs on Chinese textiles to bring opportunities to Vietnamese textile production, the risks faced by Vietnam are also not small. On the whole, due to the Sino-US trade war, Vietnam’s textile and apparel market share in the United States will increase by 1%.


According to Vietnam Cotton & Spinning Association analysis, if China and the United States can not reach an agreement by the end of June, and Trump imposes tariffs on the remaining Chinese textiles and clothing, Vietnam textiles and clothing has great potential to expand its market share in the United States. Especially textiles, footwear and other products, will seize China’s market share in the United States, American buyers will turn their orders to other countries. On the contrary, if China and the United States reach an agreement that the United States will not impose tariffs on all Chinese textiles and clothing, Vietnam will also expand its market share of textile and clothing imports in the United States in the coming quarters.

 
Vietnamese experts believe that since the United States imposed tariffs on Chinese products, Vietnamese textiles have increased their market share in the United States by 0.2%. If the Sino-US trade war escalates, Vietnam’s share of U.S. textile and apparel imports will increase by 1%, and its exports will reach USD 25 billion, close to 10% of Vietnam’s total exports, which is 25% of Vietnam’s exports to the United States in 2018. Nevertheless, with Vietnam’s growing trade surplus with the United States, Vietnam is also facing great risks. Trump is likely to keep an eye on Vietnam’s exports to the United States and take measures to restrict them. In 2018, Vietnam had one of the largest trade surpluses against the United States, with a surplus of USD 36 billion, ranking seventh.

 
If Vietnam’s exports to the United States increase by USD 25 billion, Vietnam’s trade surplus with the United States will exceed USD 50 billion, which may lead the United States to cancel the GSP treatment to Vietnam. The danger is self-evident. In the short term, the United States may temporarily retain Vietnam’s dominant position as a substitute for China in the coming year. Another risk is that Vietnam needs to import raw materials from China for production and then export them to the United States. Therefore, if Vietnam’s exports grow substantially, the United States will have more stringent censorship of the country of origin. Once the raw materials of the products are found to be from non-CPTPP countries, the United States may impose sanctions on Vietnamese products. At that time, Vietnam can only strengthen market supervision and strictly issue certificates of origin to avoid such risks.

2024.12   

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