VOA January 10, 2023

Vietnam’s trade surplus with the US has grown to a record while the deficit in the area of commodity trade with China of the Southeast Asian country also increased to the highest level recorded.

New data released by the General Department of Customs cited by Reuters shows Vietnam’s trade surplus with the US increased to the highest level in recorded history, to 94.9 billion USD in 2022, with Vietnam’s key products exported to the US market such as apparel, footwear, smartphones, electronics and furniture.

Meanwhile, data released by the United States Census Bureau (USCB) shows that as of currently, Vietnam exports to the US worth more than 109 billion USD while importing from the United States of the same period is worth just over $9.7 billion.

Vietnam has a trade surplus with the US in 2021 of more than 90.8 billion USD record high up to that point.

Vietnam’s trade deficit with the US increases every year, making Vietnam a become the country with the 3rd highest gap between exports and imports with the US, after only China and Mexico.

This has led President Donald Trump to put Vietnam in the ‘target’ to force a reduce in trade surplus with the US. Mr. Trump also directed the Treasury Department to conduct investigations into currency manipulation or the origin of imported timber in the Southeast countries. However, trade tensions between the US and Vietnam have been reduced under the President Joe Biden with Vietnam being removed from the list of US currency manipulating countries.

At the same time, the trade deficit with China, a supplier of raw materials and equipment, largest equipment for Vietnam’s labor-intensive manufacturing sector, which has grown to a record $60.2 billion last year, up from $54 billion a year earlier.

Vietnam’s customs data released on January 9 cited by Reuters showed that imports of Vietnam from China last year increased 6.6% to $117.87 USD billion, with the leading products imported are machinery, electronics, fabrics, smartphones and components.

Although the US is Vietnam’s largest export market, according to of VnEconomy last November, China was again “the most important market, has a great impact on the scale and growth rate of Vietnam’s exports and imports”. According to this newspaper, import and trade deficit from China is large and increasing due to many reasons, that is, the neighboring country of Vietnam is currently an economy with highest export turnover of the world.

And Vietnam’s exports to the US are increasing, especially in recent years since President Trump launched the trade war with China, prompting American companies to seek suppliers outside of China. COVID-19 pandemic causing even more shift of production lines of American companies out of China to countries like Vietnam more quickly and trade between the US and Vietnam increased higher.

With a high proportion of trade with the US, Vietnam in the past year has pushed Britain out from its longstanding position in the top seven US commodity trading partners.

Vietnam is benefiting from about 15 free trade agreements that help promote boosted the Southeast Asian nation’s export-oriented economy to 8% growth in last year. Total export turnover in 2022 increased by 10.6% to 371.85 billion USD, according to statistics recently released by the General Department of Vietnam Customs.

However, according to Reuters, economists warn that Vietnam is facing the “backwinds,” as weakening global demand has begun to affect the Vietnam’s orders in December 2022 caused exports to drop 14% from a year before.