US-China trade war likely to hurt Vietnamese economy
The ongoing US-China trade war will greatly impact on the structure of the world economy in the future, causing damage but also generating indirect opportunities for countries where the economy relies heavily on agricultural production like Vietnam.
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According to head of the Vietnam Cashew Association’s Trade Promotion Division Tran Van Hiep, although it is still quite early to assess the impact of the US-China trade war, it’s possible that Vietnamese cashews may benefit from this war.
Hiep said the US is now one of the world’s leading almond exporters. Therefore, if China imposed a tax on this product, it would certainly affect US almond exports. Meanwhile, the almond is just one of the 12 nuts in the international dried fruit goods basket, and it can be replaced with other nuts when prices are too high.
“This will be an opportunity for the Vietnamese cashew industry to promote export of cashew nuts to the Chinese market,” said Hiep.
“In the Vietnamese structure of cashew exports, the US is still the largest import market, accounting for 35% of market share. It’s followed by China with 10% market share,” he added.
Relating to the pig industry, Vice Chairman of the Animal Husbandry Association of Vietnam Pham Duc Binh said that Vietnamese enterprises had promoted imports of pork due to the high price of pork in the country.
The price of dressed pork in Vietnam ranges from VND48,000-50,000 (US$2.07-2.16) per kilo. Meanwhile, the price of slaughtered pork imported into the country is only US$1.5 per kilo. At this price, food processors are forced to increase the imports of pork to meet the production demand in the last months of the year.
“In that context, the US will be the market that businesses are aiming for, in hopes of gaining a cheaper import price due to the impact of the war. However, with the habit of preferring to consume imported goods, in the long run the Vietnamese livestock will lose on the domestic front,” said Binh.
Insiders said that both the US and China are two important trading partners of Vietnam, so it is likely that this war would have a great impact on the economy of Vietnam.
Many issues may arise in the near future, such as trade fraud and temporary imports for re-export. Therefore, it í necessary to strengthen the management role of the State to help the economy grow healthily as well as to identify the risks and opportunities for the economy of Vietnam in the future, they noted.
