Vietnam’s government will use a combination of trade deals and domestic reforms to survive the fallout from a U.S.-China trade war, according to Prime Minister Nguyen Xuan Phuc.
“This trade war between the U.S. and China will surely affect Vietnam,” the premier said in an interview with Bloomberg Television’s Haslinda Amin at the Government Office in Hanoi on Monday, ahead of the World Economic Forum on Asean, which Vietnam is hosting. “We are seeking new ways to grow,” he added. “We want to maintain good relations with both the U.S. and China.”
Vietnam’s economy is particularly sensitive to disruptions in global supply chains as trade amounts to about twice its gross domestic product -- more than any country in Asia apart from Singapore. About a quarter of Vietnam’s total trade is with China, which is facing potential tariffs on all of its exports to the U.S. in an escalating trade war with President Donald Trump.
Phuc said it’s important for Vietnam to maintain macroeconomic stability, export growth and living standards for the country’s 96 million people. He repeatedly said Vietnam was “resilient” in the face of global challenges and would seek more trade agreements beyond the 12 it has already completed.
“We will have to rely on our internal strength and get our house in order so we can overcome any obstacles and maintain momentum and growth,” Phuc said.
Vietnam’s GDP expanded 7.1 percent in the first six months of the year, the second-fastest among major Asian economies behind India. Still, the government has said growth may slow in the second half and it’s seeking to keep inflation under control, with steps including subsidizing fuel and freezing electricity prices.
Vietnam’s government will use a combination of trade deals and domestic reforms to survive the fallout from a U.S.-China trade war, according to Prime Minister Nguyen Xuan Phuc.
“This trade war between the U.S. and China will surely affect Vietnam,” the premier said in an interview with Bloomberg Television’s Haslinda Amin at the Government Office in Hanoi on Monday, ahead of the World Economic Forum on Asean, which Vietnam is hosting. “We are seeking new ways to grow,” he added. “We want to maintain good relations with both the U.S. and China.”
Vietnam’s economy is particularly sensitive to disruptions in global supply chains as trade amounts to about twice its gross domestic product -- more than any country in Asia apart from Singapore. About a quarter of Vietnam’s total trade is with China, which is facing potential tariffs on all of its exports to the U.S. in an escalating trade war with President Donald Trump.
Phuc said it’s important for Vietnam to maintain macroeconomic stability, export growth and living standards for the country’s 96 million people. He repeatedly said Vietnam was “resilient” in the face of global challenges and would seek more trade agreements beyond the 12 it has already completed.
“We will have to rely on our internal strength and get our house in order so we can overcome any obstacles and maintain momentum and growth,” Phuc said.
In written comments distributed as an addendum to the interview, Phuc said Vietnam would strive to make its economy more competitive and “closely watch the development of international markets to manage our currency with active and flexible monetary policies in combination with strict fiscal policies.” At the Asean meeting, Vietnam “expects to discuss new business deals with companies and regional economies,” according to Phuc.
Vietnam’s GDP expanded 7.1 percent in the first six months of the year, the second-fastest among major Asian economies behind India. Still, the government has said growth may slow in the second half and it’s seeking to keep inflation under control, with steps including subsidizing fuel and freezing electricity prices.
Moody’s Investors Service upgraded Vietnam’s credit score last month, citing its strong growth potential buoyed by healthier banks, stable debt levels and more efficient use of capital. The Vietnamese dong is among the most stable currencies in Asia this year, compared to large declines in others like the Indian rupee and the Indonesian rupiah.
Photographer: Maika Elan/Bloomberg
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