The United States is our country's leading partner and any changes in its policies (if any) will greatly affect Vietnam's export turnover.

A large market but with many difficulties

Seafood is one of Vietnam's main export items to the United States. According to data from the Vietnam Association of Seafood Exporters and Producers (VASEP), Vietnam's seafood export revenue to the United States increased by 161% in October and 40% in November.

However, shrimp - a key export item to the United States - is also constantly facing trade defense measures from this market. Accordingly, at the end of November 2023, the US Department of Commerce initiated an anti-subsidy investigation into frozen warm-water shrimp imported from Vietnam. Previously, in 2013, the United States initiated an anti-subsidy investigation into Vietnamese shrimp, but ended it without imposing taxes due to no damage to the US domestic production industry.

Regarding the anti-subsidy investigation, at the end of October, the United States issued the Final Conclusion of the case. Accordingly, the anti-subsidy tax rate for the mandatory defendant and other shrimp exporting companies of Vietnam is 2.84%, much lower than that of the countries under investigation (including Ecuador, India and Indonesia). Accordingly, the anti-subsidy tax rate of India is 5.77-5.87% and Ecuador is 3.57-4.41%. Evidence from the shrimp industry shows that although the US market is the leading large market for Vietnamese goods, it is erecting many barriers for Vietnamese goods.

Statistics from the General Statistics Office, in the first 11 months of 2024, the US was Vietnam's largest export market with a turnover of 108.9 billion USD, up 23.9%; import turnover from the US reached 13.5 billion USD, up 7.3%; trade surplus with the US reached 95.4 billion USD, up 26.7% over the same period last year.

Sharing about the potential of the US market for Vietnamese goods, Mr. Ta Hoang Linh, Director of the Department of European-American Markets (Ministry of Industry and Trade) said that the two countries' official announcement of upgrading their relationship to the level of Comprehensive Strategic Partnership in September 2023 has created a solid foundation, helping the cooperation activities between the two countries to go deeper and more substantive on all pillars, in which the economic-trade-investment pillar continues to play the role of the central driving force promoting the relationship between the two countries.

The US market has a demand for many Vietnamese goods, from agricultural, forestry and fishery products to consumer goods and electronics. For example, in June 2024, the first batch of green-skinned elephant mangoes from Can Tho departed for the US by air, with the exporting unit being Vina T&T Group - a famous fruit exporter in Vietnam. This is the first batch of mangoes from Can Tho, but for Vina T&T Group, this enterprise has been exporting containers of agricultural products regularly every week. The rush of orders to markets, including the US, has contributed to the export turnover of nearly 7 billion USD of vegetables and fruits this year.

Be prepared for obstacles

In addition to the bright spots of the US market, this is also considered a market with many barriers to Vietnamese goods. According to statistics from the World Trade Organization (WTO), the United States is currently the world's leading country in investigating and applying trade defense measures, and is also the country that investigates and applies the most trade defense measures to Vietnamese export goods. To date, this country has investigated 64 cases out of a total of 267 foreign cases investigated with our country (accounting for 25%), including 28 anti-dumping cases, 11 anti-subsidy cases, 22 anti-tax evasion cases and 03 self-defense cases.

Most recently, on November 20, the United States issued a Decision to apply global self-defense measures to 2 products: artificial staple fibers from polyester and imported hard capsule shells.

Mr. Do Ngoc Hung, Commercial Counselor, Head of the Vietnam Trade Office in the United States, said that with the third largest trade deficit among the total partners of the United States, Vietnam is at risk of having to pay the same tax rate as China in the initial stage (15%) and may gradually increase if the trade deficit situation is not improved and Vietnam's agreements with the United States are not implemented. The worrying thing is that it will apply to all exported goods from Vietnam, not just goods related to China (investment, raw materials, labor, etc.). Therefore, the immediate task is to pay attention to solving the trade deficit problem, although this basically shows that the foreign trade structure of each country is complementary and not directly competitive.

Regarding the industries, Ms. Le Hang, Director of Communications of VASEP, recommends that exported seafood products must fully comply with the regulations of the FDA (US Food and Drug Administration), including standards on hygiene, food safety and disease prevention. At the same time, businesses need to ensure standards on sustainable production and strict quality control from farming to processing to meet the increasingly high requirements of the US market.

US customers and consumers are increasingly concerned about issues related to sustainability, environmental protection and social responsibility. Therefore, Vietnamese seafood enterprises should apply sustainable farming methods, such as clean shrimp farming, and aquaculture according to international standards (GlobalGAP, ASC, MSC) to enhance their reputation and meet the increasing demands of the market.

From an expert perspective, Associate Professor, Dr. Dinh Trong Thinh, an economic expert, said that the re-election of Donald Trump as President of the United States will have many impacts on the import and export activities of countries, including Vietnam. Donald Trump's policy is aimed at the United States, the United States is above all, so it is possible to impose high taxes on imported goods and some countries.

In addition, the US market still has requirements for goods to ensure that goods exported to their country must meet the standards, so we must also strive to meet the standards they set.

However, China's higher taxes may lead to a strong trend of Chinese investment in Vietnam. In some cases, it may be with the purpose of using Vietnam as a "transit" for trade fraud and tax evasion, leading to the transfer of a large number of investment projects from China, which is also a significant risk in the coming time while Vietnam has no measures to limit attracting investment from a specific country in the current policy system. Therefore, relevant ministries, branches and localities need to strengthen supervision of licensing of new investment projects and screening of investment capital to avoid Vietnam becoming a transit location. In particular, the most affected sectors may be textiles, footwear, seafood, electronics and wooden furniture.

Source: VASEP