VCN- The US-China trade war officially broke out on July 6, which is supposed to have a strong impact on the Vietnamese economy, especially for export and import of goods. Taking advantage of opportunities as well as defending challenges in this matter is not simple.
|Nam Hai Dinh Vu Port in Hai Phong. Photo: Thai Binh.|
Declining export growth
Le Quoc Phuong, the former deputy director of the Center for Trade and Industry Information (Ministry of Industry and Trade), said, "These are the two leading economies and the two import-export powers in the world. Therefore, trade war will affect the world economy in general.”
For Viet Nam, the United States and China are the two largest export markets, the negative impact on the export of goods is quite clear. Specifically, when the United States imposes high import tariffs on Chinese goods, the United States will also apply measures to those countries that use Chinese inputs, typically the United States for iron. Meanwhile Vietnam is importing a lot of raw materials from China, including iron and steel, textiles...
In this regard, the World Economic Division, the National Center for Socio-Economic Information and Forecasting, the Ministry of Planning and Investment made the following analysis and calculations: Vietnam may suffer from negative impacts because the global economic growth is slowing down; demand for Vietnam's export goods has decreased. Because in the US-China trade war, with the exception of the EU, Vietnam's major trading partners were negatively affected. It is forecasted that Vietnam's export growth rate will decrease by 0.3 % in 2019 and more strongly in 2021-2023. Similarly, the growth rate of imports will decrease by 0.6%. This shows that the production of enterprises, especially FDI sector (NK many raw materials) will be affected.
In addition to export, focusing on analyzing the import of goods, exchanging with reporters Customs, vice Professor, Dr. Pham Tat Thang, a senior researcher at the Trade Research Institute under the Ministry of Industry and Trade, said, "The outbreak of the US-China trade war means China has difficulty in penetrating into the United States. China will seek to push goods to other markets, especially in the surrounding markets, including Vietnam. This puts a lot of competitive pressures on domestic companies, and enterprises may have to shrink production if unable to compete.”
Representatives of the World Economy said: In addition to the issues mentioned above, trade war between the two powers can make the flow of FDI into Vietnam tend to decrease. This war of trade has an impact on the production situation in the FDI sector, leading to limitation of investment flows. However, it should be noted that this effect is not too great, only about 0.01 percentage of reduction.
Diversity of exports to the United States
Besides the negative impact factor, in the opposite direction, according to Mr. Phuong, when the United States and China cannot import each others’ goods, the two sides must look for other markets. "Vietnam is a big exporter. We have the opportunity to export to both the United States and China. It is important to find ways to evaluate, capture the opportunity and consider the ability to seize the possibilities," said Phuong.
Around this point, the World Economic Forum's quick assessment report shows: The positive impact of the US-China trade war on Vietnam is that it will open up US market opportunities if export goods to China are limited. However, this effect will not cause a big gap because Chinese products subjected to tax are not the main products for Vietnam. In addition, opportunities in the Chinese market for Vietnam considered by the World Economic Committee are not too much. In the current context, the World Economic Advisory Board recommends, in the immediate future, it is necessary to continue to closely monitor the situation, especially to notify and update the list of subjected goods of taxation of both the United States and China. National exchange rate movements as well as both the dollar and yuan for enterprises to respond in time; FDI companies and Vietnamese companies are urgently advised on the US market, especially the list of goods subject to taxation so as to look for opportunities, diversifying their exports into the United States.
Some experts say that the necessity is to study more deeply the list of some Chinese goods that can be imported into Vietnam in the case where China's export to the United States is limited, so that there are ways for dealing and appropriately controlling; There are also opportunities to have quick access to large Chinese FDI investors to promote investment in Vietnam as the Chinese and US markets are affected. In the long term, businesses should prepare well information relating to trade defense with the United States in the event of widespread trade wars.
Mr. Vu Tien Loc, President of Vietnam Chamber of Commerce and Industry (VCCI), said that Vietnam needs to step up its economy, improve the business environment to promote import and export, take advantage of new opportunities in trade and investment if they are available. In addition, the important solution is the efforts to export through free trade agreements, helping Vietnam find its own way and stability in the context of world trade complex developments.
In terms of the trade war between the United States and China, Minister of Trade and Industry Tran Tuan Anh stated: This is a big problem, it is not a purely commercial war, but a general one with many other aspects. This war is not only about taxes, but also on issues of technology, economic structure, currency, credit ... "Overall, the competition between the United States and China sets requirements for individual nations, including Vietnam, and it is necessary to carefully consider the next direction of globalization," said Minister Tran Tuan Anh.
By Uyển Như/ Bui Diep