HANOI MULLS PLAN B AMID ESCALATING CHINA-US TRADE WAR
As the trade war between China and the US continues to ramp up, Vietnam has begun seeking avenues for protecting itself against the repercussions, with the two countries currently serving as its largest export destinations.
A report by the country’s National Centre for SocioEconomic Information and Forecast under the Ministry of Planning and Investment highlights the potential cost to the country of the trade wars, and offers suggestions for anticipatory measures. Details of the report have not been released to the public.
Ministry representatives confirmed that the concern is that the continuing trade battle could reduce Vietnamese exports and the inflow of foreign investment, hurting local production.
The potention vulnerability comes as the country’s economy is under threat due to weakening stocks and currency while inflation surges.
One suggestion for counterbalancing these vulnerabilities is for the central bank to consider devaluing the Vietnamese dong against the US dollar in order to increase the competitiveness of Vietnamese products, the Vietnam Institute for Economic and Policy Research suggested last month.
WVietnamese workers at a factory in Ho Chi Minh City