Data indicate that as the US steps up measures to curb trade with China by raising tariffs, it has significantly increased imports from Vietnam, a country that mostly exports goods made possible by Chinese input.
Trade imbalances have significantly increased as a result of the boom in trade between China, Vietnam, and the United States. Last year, China had a surplus of about $105 billion with Washington, which is 2.5 times more than it was in 2018, the year the Trump administration first imposed significant tariffs on Chinese goods.
Only China, Mexico, and the European Union have a greater trade surplus with the United States than Vietnam has at the moment.
The United Nations, the United States, Vietnam, and China provide trade, customs, and investment statistics that Reuters investigated. These findings support the growing symbiotic connection, which is also supported by preliminary World Bank figures and the opinions of six economists and supply chain specialists.
It demonstrates that imports from China, Vietnam's neighbour, have been a major contributor to the country's export growth, with recent inflows from China nearly perfectly matching the value and fluctuations of exports to the US.
The World Bank estimates a 96% connection between the two flows in early figures that were shared with Reuters; this is an increase from 84% prior to Donald Trump's election.
"The surge in Chinese imports in Vietnam coinciding with the increase in Vietnamese exports to the U.S. may be seen by the U.S. as Chinese firms using Vietnam to skirt the additional tariffs imposed on their goods," said Darren Tay, lead economist at research firm BMI, noting that could lead to tariffs against Vietnam after U.S. elections.
The widening trade disparity coincides with Vietnam's pursuit of market economy status in Washington following President Joe Biden's attempt to strengthen diplomatic ties with its erstwhile adversary.
Vietnam's products imports into the United States reached over $114 billion last year, more than twice as much as they were at the start of the Sino-American trade war in 2018. This increased Vietnam's attractiveness to manufacturers and merchants looking to lower risks associated with tensions between China and the United States.
According to data on U.S. trade, the increase was responsible for almost half of the $110 billion decline in imports from Beijing since 2018.
According to Nguyen Hung, an expert in supply chains at RMIT University Vietnam, "Vietnam captured more than 60% of China's loss" in important industries including textiles and electric equipment.
However, data indicates that a significant portion of Vietnam's exports to Washington are parts and components created in China, so Chinese contribution is still vital.
According to data from the Asian Development Bank, in 2022, imported components made up almost 80% of the value of Vietnam's electronics exports, which is the primary source of imports for the United States from Hanoi.
China accounts for one-third of Vietnam's imports, primarily electronics and componentry, according to data from the country that did not offer more specifics.
The Organisation for Economic Co-operation and Development stated in a report that approximately 90% of the intermediate goods imported by Vietnam's electronics and textile industries in 2020 were subsequently "embodied in exports". This figure was higher than ten years prior and significantly higher than the average in industrialised nations.
The most recent data reflects the symbiotic relationship: Vietnam's imports from China were $30.5 billion in the first quarter of this year, while U.S. imports from Vietnam came to $29 billion, reflecting comparable movements in previous quarters and years.
The White House has not commented on Vietnam's significant trade surplus since inflation is still high, but economists predict that this will change following the vote in November.
Nguyen Ba Hung, senior economist at ADB's Vietnam mission, stated that "whoever wins the elections could change the policy towards Vietnam," however he pointed out that this would increase the cost of imports for the United States.
Regarding trade disparities, the US Embassy in Hanoi declined to comment.
Requests for comments were not answered by Vietnam's ministries of trade or international affairs.
A request for comment was not immediately answered by China's trade ministry.
The growth in investments in the Southeast Asian manufacturing centre, as corporations shift certain activities from China, is reflected in the spike in commerce between China, Vietnam, and the United States.
While adding value in their new plants in Northern Vietnam, many of those businesses are Chinese companies that remain largely rely on supply lines from their home country.
However, as the U.S. Department of Commerce found in an examination into solar panels last year, in certain situations the trade comprises completed goods marked as "Made in Vietnam" despite no value being added in the nation. There are two investigations ongoing: one on aluminium wires and the other on solar panels that are purportedly improperly subsidised.
Vietnam's proximity to Xinjiang, the Chinese area from which the United States restricts imports due to allegations of human rights atrocities against minority Uyghurs, is another factor attracting American attention.
China's primary supplier of cotton and polysilicon, which are used in solar panels, is Xinjiang. Both are essential to Vietnam's economy, which last year sent 9% of its total exports to the United States in the form of solar panels and cotton clothing.
According to U.S. customs data, Vietnam is the nation that has the largest amount of goods by value that have been refused entry into the country due to concerns about Uyghur forced labour.
Although Vietnam's imports of raw cotton from China decreased by 11% to 214,000 tonnes in 2018, they were still over twice as large as those of 2018.
Additionally, China now exports cotton clothing to Vietnam for at least $1.5 billion, up from around $1.3 billion in 2022. Meanwhile, the data, which may not cover all cotton goods, shows that U.S. imports of cotton clothing from Vietnam decreased by 25% to $5.3 billion in 2018.
According to Hung Nguyen of RMIT, Vietnam overtook China as the primary supplier of goods subject to the Xinjiang ban last year, which coincided with a decline in U.S. imports.
(Source:www.businesstimes.com.sg)
Trade imbalances have significantly increased as a result of the boom in trade between China, Vietnam, and the United States. Last year, China had a surplus of about $105 billion with Washington, which is 2.5 times more than it was in 2018, the year the Trump administration first imposed significant tariffs on Chinese goods.
Only China, Mexico, and the European Union have a greater trade surplus with the United States than Vietnam has at the moment.
The United Nations, the United States, Vietnam, and China provide trade, customs, and investment statistics that Reuters investigated. These findings support the growing symbiotic connection, which is also supported by preliminary World Bank figures and the opinions of six economists and supply chain specialists.
It demonstrates that imports from China, Vietnam's neighbour, have been a major contributor to the country's export growth, with recent inflows from China nearly perfectly matching the value and fluctuations of exports to the US.
The World Bank estimates a 96% connection between the two flows in early figures that were shared with Reuters; this is an increase from 84% prior to Donald Trump's election.
"The surge in Chinese imports in Vietnam coinciding with the increase in Vietnamese exports to the U.S. may be seen by the U.S. as Chinese firms using Vietnam to skirt the additional tariffs imposed on their goods," said Darren Tay, lead economist at research firm BMI, noting that could lead to tariffs against Vietnam after U.S. elections.
The widening trade disparity coincides with Vietnam's pursuit of market economy status in Washington following President Joe Biden's attempt to strengthen diplomatic ties with its erstwhile adversary.
Vietnam's products imports into the United States reached over $114 billion last year, more than twice as much as they were at the start of the Sino-American trade war in 2018. This increased Vietnam's attractiveness to manufacturers and merchants looking to lower risks associated with tensions between China and the United States.
According to data on U.S. trade, the increase was responsible for almost half of the $110 billion decline in imports from Beijing since 2018.
According to Nguyen Hung, an expert in supply chains at RMIT University Vietnam, "Vietnam captured more than 60% of China's loss" in important industries including textiles and electric equipment.
However, data indicates that a significant portion of Vietnam's exports to Washington are parts and components created in China, so Chinese contribution is still vital.
According to data from the Asian Development Bank, in 2022, imported components made up almost 80% of the value of Vietnam's electronics exports, which is the primary source of imports for the United States from Hanoi.
China accounts for one-third of Vietnam's imports, primarily electronics and componentry, according to data from the country that did not offer more specifics.
The Organisation for Economic Co-operation and Development stated in a report that approximately 90% of the intermediate goods imported by Vietnam's electronics and textile industries in 2020 were subsequently "embodied in exports". This figure was higher than ten years prior and significantly higher than the average in industrialised nations.
The most recent data reflects the symbiotic relationship: Vietnam's imports from China were $30.5 billion in the first quarter of this year, while U.S. imports from Vietnam came to $29 billion, reflecting comparable movements in previous quarters and years.
The White House has not commented on Vietnam's significant trade surplus since inflation is still high, but economists predict that this will change following the vote in November.
Nguyen Ba Hung, senior economist at ADB's Vietnam mission, stated that "whoever wins the elections could change the policy towards Vietnam," however he pointed out that this would increase the cost of imports for the United States.
Regarding trade disparities, the US Embassy in Hanoi declined to comment.
Requests for comments were not answered by Vietnam's ministries of trade or international affairs.
A request for comment was not immediately answered by China's trade ministry.
The growth in investments in the Southeast Asian manufacturing centre, as corporations shift certain activities from China, is reflected in the spike in commerce between China, Vietnam, and the United States.
While adding value in their new plants in Northern Vietnam, many of those businesses are Chinese companies that remain largely rely on supply lines from their home country.
However, as the U.S. Department of Commerce found in an examination into solar panels last year, in certain situations the trade comprises completed goods marked as "Made in Vietnam" despite no value being added in the nation. There are two investigations ongoing: one on aluminium wires and the other on solar panels that are purportedly improperly subsidised.
Vietnam's proximity to Xinjiang, the Chinese area from which the United States restricts imports due to allegations of human rights atrocities against minority Uyghurs, is another factor attracting American attention.
China's primary supplier of cotton and polysilicon, which are used in solar panels, is Xinjiang. Both are essential to Vietnam's economy, which last year sent 9% of its total exports to the United States in the form of solar panels and cotton clothing.
According to U.S. customs data, Vietnam is the nation that has the largest amount of goods by value that have been refused entry into the country due to concerns about Uyghur forced labour.
Although Vietnam's imports of raw cotton from China decreased by 11% to 214,000 tonnes in 2018, they were still over twice as large as those of 2018.
Additionally, China now exports cotton clothing to Vietnam for at least $1.5 billion, up from around $1.3 billion in 2022. Meanwhile, the data, which may not cover all cotton goods, shows that U.S. imports of cotton clothing from Vietnam decreased by 25% to $5.3 billion in 2018.
According to Hung Nguyen of RMIT, Vietnam overtook China as the primary supplier of goods subject to the Xinjiang ban last year, which coincided with a decline in U.S. imports.
(Source:www.businesstimes.com.sg)
