US no longer treats Vietnam as developing country

25-Feb-2020 Intellasia | The SaigonTimes | 6:02 AM Print This Post

Vietnam is assessing the impact of a United States decision to remove the Southeast Asian nation from the list of developing countries under US countervailing duty laws, said Ministry of Foreign Affairs deputy spokesman Doan Khac Viet.

The spokesman was responding to reporters’ questions on Vietnam’s response to the US move at a press briefing in Hanoi on Thursday, according to a statement on the ministry’s website.

Viet said in the statement that bilateral ties between Vietnam and America have expanded significantly in recent years, with bilateral trade amounting to roughly $76 billion last year, up 25 percent against 2018.

The US remains Vietnam’s largest export market, while Vietnam is among America’s fastest-growing export markets, he added.

“Vietnam will maintain dialogue and coordinate activities with the United States to boost bilateral trade in a harmonious and sustainable manner,” he said, adding that the move is meant to benefit both countries.

He noted that Vietnam is still benefiting from its developing nation status with the World Trade Organisation (WTO).

On February 10, the Office of the United States Trade Representative (USTR) announced it was issuing a notice in the Federal Register to update its list of countries designated as developing or least-developed under US countervailing duty laws.

“Federal law specifies certain differential treatment for imports from developing or least-developed countries and obligates USTR to update the designations periodically,” according to the notice.

The USTR considers countries with a share of 0.5 percent or more of the global trade to be developed countries. Therefore, Brazil, India, Indonesia, Malaysia, Thailand and Vietnam are ineligible for the 2 percent de minimis standard.

The agency also cited the most recent World Bank data as indicating that each country has a per capita gross national income below $12,375.

The USTR’s notice was the outcome of a bureaucratic review, initiated by an executive memo from US President Donald Trump on reforming developing-country status in the WTO, according to Emeritus Professor Carlyle A. Thayer at the Australia-based University of New South Wales.

Thayer explained in his background briefings on February 15 that countries like Vietnam that were taken off the developing countries list will no longer receive preferential treatment.

These countries will be subject to a lower threshold for triggering a US countervailing duties investigation into whether their exports are unfairly subsidised by the state and harm US industries, he added.

As the 16th largest US trade partner, Vietnam joins Malaysia (17th), Singapore (18th), Thailand (21st) and Indonesia (27th) in losing its developing country status. He pointed out that their exports to the United States will be more expensive because of the elimination of preferential tariffs.

The US had a trade deficit of nearly $55.8 billion with Vietnam last year, up from some $39.5 billion in 2018, according to the US Census Bureau, a principal agency of the US Federal Statistical System.

Meanwhile, the general Department of Vietnam Customs reported in a statement on January 13 that Vietnam’s trade surplus with the US had widened to $46.98 billion last year from $34.87 billion a year earlier.

The Vietnamese government has been seeking ways to import more US goods to help narrow the trade gap.

https://english.thesaigontimes.vn/74892/us-no-longer-treats-vietnam-as-developing-country.html

 


Category: Economy, Vietnam

Print This Post