This visit has been successful in paving the way for new development opportunities and stronger trade relations between the two countries.
According to statistics from the General Department of Customs, the bilateral trade turnover between Vietnam and the US in 1995 was at USD 450 mn, and by 2021 it had increased to USD 111.6 bn, 248 times higher. In 2021, Vietnam exported USD 96.3 bn worth of goods to the US, up by 24.9% compared to 2020, accounting for 28.6% of the total export turnover of the country. As a result, Vietnam had a trade surplus of USD 81 bn, and the US continues to be Vietnam's number one trade surplus market, up by 27.9% compared to USD 63.4 bn in 2020. This has contributed to creating a new peak in exports and imports and prolonging the trade surplus for six consecutive years from 2016 until 2021. Vietnam is now in the group of twenty countries with the largest trade in the whole world.
Bilateral trade
Vietnam’s main export products to the US are in the lead position. In 2021, Vietnamese exports to the US had twenty-eight key products, of which thirteen items were valued at USD 1 bn. From the beginning of 2022 until now, these items have grown to a new high level, and are the driving force for Vietnam’s economic recovery and development. More than 50% of Samsung phone production in the world is made in Vietnam. Of the total market share of Samsung phones in the US, sales of folding phones have increased from 0.6% in 2020 to 12% in 2021.
Export of wood and wood products in the first four months of 2022 reached USD 5.48 bn, up 4.5% over the same period in 2021. The US is in the group of the three largest import markets for wood and wood products from Vietnam. In 2021, the US was the number one seafood export market in Vietnam, with 23.1% of the total seafood export turnover. Since the beginning of the year, seafood exports have occupied a runner-up position in the export of agricultural goods and the export market share to the US continues to be at the top, along with China.
Ever since the two countries agreed on an action plan to harmonious a sustainable trade balance, many complicated issues in bilateral economic trade have gradually been erased, bringing benefit to the business communities of the two countries. The US Trade Representative Office (USTR) also officially concluded the investigation into Vietnam's practices, policies, and alleged undervaluation of the Vietnamese currency. Anti-dumping tax on Vietnamese honey exported to the US has also decreased sharply, from 410.93% to 413.99% in the preliminary conclusion to 58.74% to 61.27% at present.
More and more top US traders are now paying attention to a growing Vietnamese market. One of the highlights of a recent event of the Foreign Affairs Department (FAS) of the US Department of Agriculture and the American Chamber of Commerce (AmCham), was a food and beverage exhibition held in Đà Nẵng. The exhibition brought together twenty-one participating units, such as agricultural associations, state representatives, distributors, and manufacturers of the United States. They showcased many products such as beef, pork, chicken, seafood, potatoes, cheese, raisins, beans, soy products, apples, blueberries, ginseng, popcorn, pecans, wine, and whiskey.
The event marked the opening in Đà Nẵng of the Economic Center in Central Vietnam, in the context that international tourism is now gradually recovering after the Covid-19 pandemic and the US exhibition organizers tried to reach out to a wide range of enterprises. In 2021, Vietnam's fruit and vegetable exports were among the twenty-eight key products that Vietnam exported to the US, which was an increase by 32% compared to 2020.
Trade and investment
According to a report by the Vietnam Confederation of Trade and Industry (VCCI) and the General Department of Customs, in collaboration with the US International Development Agency (USAID), the enterprises experiencing facilitation was the highest when complying with procedures in the field of goods quality management.
However, despite being Vietnam's leading trade partner, the US ranks only 11th among Vietnam's Foreign Direct Investment (FDI) partners. Vietnam’s trade surplus with the US is mainly from FDI enterprises, so it is difficult to actively take advantage of this surplus to import equipment and raw materials for production in US dollars. In addition, due to weak logistics, lack of containers, traffic congestion, high transportation costs, and high prices of raw materials, a fluctuating market can cause disruptions to the goods supply chain. These are bottlenecks that are preventing Vietnam from making full use of existing advantages and fully promoting goods to the world's leading economy.
The trade value of the two countries is large but there is still room for more growth. New opportunities for trade and investment flow are very necessary. Therefore, to build new opportunities Vietnam needs to create an independent and proactive economy and trade with extensive international integration and know-how to adapt and become resistant to huge, unexpected impacts from the world market and effectively participate in the global value chain. This will enable Vietnam to export large volumes of goods and meet large long-term orders according to US standards.
