Vietnam-US trade: Increasing nearly 250 times after 26 years

Structure of key commodities in total export turnover to the US by the end of April 2022. Sketched: T. Bình

The story of textile exports

In the foreign trade relationship between Vietnam and the United States, our country's export textile and garment industry plays a very important role. For many years, the world's largest economy has always been the largest export market of this group of commodities with the market share in recent years hovering around 50% of the country's textile and garment export turnover. For example, in 2021, textile and garment exports to the US reached more than US$16 billion, accounting for 49.2%.

However, gaining a foothold in the US market is not easy. In an article that was published a few years ago, Mr. Le Quoc An, Chairman of Vietnam Textile and Apparel Association - Vinatex (period 1999-2010), once said "this was a dream come true".

Mr. Le Quoc An recalled the end of 2001 when the Vietnamese textile and garment business delegation of about 20 units accompanied the delegation of government leaders to the United States in order to organize the first exhibition of Vietnamese textiles and garments and launched the Trade Representative Office of Vinatex in New York on the occasion of the two governments' agreement to put the Vietnam-US Trade Agreement (BTA) into effect.

At that time, Vietnam's textile and garment exports to the US only reached US$47 million, ranking 67th among the countries and territories exporting textiles to this market. Total textile and garment export turnover of Vietnam that year was also less than US$2 billion, while Thailand reached over US$6 billion and Indonesia reached over US$8 billion.

“Aware of the importance of trademarks and intellectual property in commercial relations with US importers, I joined the team to review and remove the samples of US brands that were unintentionally displayed at the show (we didn't basically process for these brands at the time). Thanks to our country's Trade Counsel in the US, we connected and invited the leaders of some big brands such as Diesel, Limited Brand, Target, Smart Shirt, Mast Industries to come in contact at the exhibition and after viewing the sample. They were quite satisfied and accepted to visit us in Vietnam in early 2002," Mr. Le Quoc An recalled.

Along with the positive impact of BTA (eliminating discriminatory regime in import tax on Vietnamese goods), textile and garment enterprises continued to organize textile and garment exhibitions in Hanoi and Ho Chi Minh City in April 2002 to welcome US importers.

Soon after, Limited Brands, Mast Industries and Target decided to open their representative offices in Vietnam and started taking orders here. Even in 2002, Vietnam's textile and garment exports to the United States reached US$957 million (increasing 20 times more than in 2001).

According to An, after the supervision mechanism for Vietnamese textile and garments was abolished by the US side in mid-2009, from 2010 onwards, this industry would really be treated equally when exporting to the United States as similar to WTO members. Thus, it achieved double-digit annual growth. By 2019, Vietnam's textile and garment exports to the United States had reached over US$15 billion, becoming the second-largest textile and garment exporter to the United States in the world after China.

From hundreds of millions to hundreds of billions of dollars

Along with the textile and garment industry, many other industries of Vietnam have also found a strong foothold to help maintain the position of the United States as the largest export market of Vietnam. Groups of goods exported to the US are increasingly diversified, from agricultural products to high-tech fields such as phones, computers, machinery, etc.

By 2021, after 26 years of normalizing and establishing diplomatic relations, bilateral trade between Vietnam and the United States increased by about 247 times, from US$450 million in 1995 to US$111.56 billion. In Vietnam's foreign trade history, the United States is the second trading partner to reach US$100 billion (after China).

In 2021, Vietnam's exports to the United States reached US$96.29 billion, increasing 24.9% compared to 2020. The world's largest economy continues to be Vietnam's largest export market when accounting for 28.6% of the country's turnover.

Last year, there were 13 groups of goods exported to the US with a turnover of US$1 billion or more, of which three groups reached more than US$10 billion, including machinery and equipment with US$17.82 billion; textiles and garments US$16.1 billion; computers, electronic products and components reached US$12.76 billion. The agricultural sector also has many groups of "billions of dollars" such as wood and wood products (US$8.77 billion), seafood (more than US$2 billion), and cashew nuts (more than US$1 billion).

In the opposite direction, last year, Vietnam spent US$15.27 billion importing goods from the United States, increasing 11.4% compared to 2020 and accounting for 4.6% of the country's turnover. Two groups of imported goods achieving a turnover of US$1 billion or more are computers, electronic products and components, reaching US$4.79 billion; cotton was US$1.17 billion. In addition, the group of machinery and equipment also achieved a turnover of approximately US$1 billion (US$992 million).