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Promoting US-Vietnam trade relations

21:00 | 31/05/2017

VCN - Import and Export turnover between Vietnam and the US grows continuously at a high rate. Currently, Vietnam is the 12th largest exporter to the US and ranks 27th among largest importers from this market. Prime Minister Nguyen Xuan Phuc's visit to the US from 29th  to 31st May 2017 is expected to be a "leverage" to further boost trade between the two countries in the coming time.

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The conference on the future of Vietnam and the United States bilateral economic relations held by VCCI and Amcham on May 19th, 2017 in Ha Noi.

Trade grows continuously

According to the report from the America Market Department (Ministry of Industry and Trade), since the Vietnam-US Bilateral Trade Agreement (BTA) took effect in 2000, export and import turnover between Vietnam and the US grows continuously at a high rate.

Two-way trade turnover between the two countries increased from $US 220 million in 1994 to $US 1.4 billion in 2001 (the year before BTA took effect) and reached over $ US 47 billion by the end of 2016.

Export turnover was $ US 38.4 billion, an increase of approximately 15% compared to 2015, import turnover was $ US 8.7 billion, an increase of 11.7%.

Thus, after 20 years of normalisation of relations, Vietnam is the 12th largest exporter to the US and ranks 27th among largest importers from this market (until December 2016).

US-Vietnam trade is expected to grow better with the Trans-Pacific Partnership (TPP). But the TPP is unfinished when US President Donald Trump stated the US will quit the TPP. How does this matter affect the trade of the two countries, especially the export of Vietnam to this market?

Mr. Tran Duy Dong, Director of the America Market Department (Ministry of Industry and Trade) said that Donald Trump became the president raised concern that Vietnam's exports to the United States will decline and slow down in 2017 as a result of new government's policies, especially US’s removal of TTP, which is supposed to benefit exporters to the US, including Vietnam. "In fact, in the first months of 2017, exports from Vietnam to the US have not suffered any adverse impact from this, ” Mr. Dong said.

He pointed out, until the end of April 2017, Vietnam's export turnover to the US reached $ US 12.4 billion, accounting for more than 20% o the total export turnover of Vietnam, up 8.7% over the same period of 2016. Until the end of April 2017, import turnover from the United States of Vietnam reached approximately $US 2.5 billion, accounting for 4.7% of total import turnover of Vietnam, up 22%. The import-export structure between the two countries has not changed, Vietnam mainly exports to the United States fishery products, textiles and garments, footwears, wood and wooden products, computers, electronic products and components, agricultural products ..., Computer, electrical products and components, cotton of all kinds, animal feed and raw materials, soybean, machinery, equipment, tools, spare parts are imported from US.

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Many businesses pay attention to invest into Vietnam

Along with the growth of trade, the US’s investment into Vietnam has also produced impressive figures. According to statistics from the Foreign Investment Agency (Ministry of Planning and Investment), from the beginning of 2017 to the end of May 20th, 2017, 91 countries and territories have investment projects in Vietnam. The US ranks 11th on investment in Vietnam with a total investment capital of $US 95.99 million, accounting for 0.8% of total investment into Vietnam.

Currently, many large US corporations have invested quite successfully in Vietnam. For example, in March 2017, PetroVietnam (PVN) and ExxonMobil Corporation signed a Project Framework Heads of Agreement and Gas Sales Agreement Heads of Agreement of Blue Whale Project chain with total $US 10 billion, it is expected to contribute to the US become one of the leading investors in Vietnam. Recently, Jabil Circuit, Inc is a large technology corporation of America which officially build a new production area in Saigon Hi-tech Park (SHTP) in Ho Chi Minh City.

promoting us vietnam trade relations US-Vietnam Joint Statement

The full text of the Joint Statement Between the United States of America and the Socialist Republic ...

According to a recent survey of the American Chamber of Commerce in Vietnam (AmCham) Vietnam is still the first choice of the US enterprises among South East Asian countries. 72% of the US enterprises appreciate that Vietnam’s business environment is improved positively. Over 40% of the US enterprises investing into Vietnam has the plan to expand their business in the next two years. More than 80% of the US enterprises expect their business performance and profits will increase in the next year.

It can be seen that although investment capital from the US into Vietnam compared to some countries such as South Korea and Japan is still modest, in some recent workshops and forums, many US enterprises have confirmed that they will continue to increase the investment capital into Vietnam. "This shows that the optimism about the expectations and choices of the US business community with considering as Vietnam the most attractive investment destination in ASEAN", Mr. Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) said.

Hope for a bilateral agreement

Above evidence shows that the US’s withdrawal from the TPP does not negatively affect trade as well as the US’s investment into Vietnam. It is impossible to predict exactly on move of the US with the future of the US-Vietnam economic relations, but Mr. Loc hopes to have a new way of bilateral and multilateral agreements to replace the TPP . " After the US quit the TPP, we need to find new and creative ways to handle market access issues which some of the US enterprises are facing in Vietnam,, " said Tami Overby, Senior Vice President of Amcham in the United States.

Mr. Adam Sitkoff, Executive Director of AmCham, also stressed that "We are constantly working to find specific methods to strengthen the bilateral trade relation between two countries, including the prospect of the bilateral free trade agreement. We believe that growth in trade and investment between the United States and Vietnam will continue and strengthen. Amcham supports free trade agreement between the United States and Vietnam. This will strengthen bilateral trade and investment, contribute to the creation of economic values and employment opportunities for the peoples of the two countries. "

US Prime Minister Nguyen Xuan Phuc's visit to the United States from 29th to 31st M 2017 is expected to be a "lever" for Vietnam to establish relationship and trade and investment with the United States. According to the Ministry of Foreign Affair, the leaders of the two countries will exchange measures to promote the Vietnam-US comprehensive cooperation in the coming time, especially in fields of politic, diplomatic and trade, economy, education, war remediation and issues which regional and international countries pay attention to, for peace, stability, cooperation and development in the region and the world.

By Phan Thu/ Ngoc Loan