March 1, 2024

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New trade war front? US examines Vietnam’s trade & currency practices – RT Business News

Using the same law that allowed the United States to impose tariffs on billions of dollars worth of Chinese imports, the Trump administration has launched an investigation into the trade practices of Vietnam, one of its largest trading partners.

The U.S. Trade Representative’s Office announced late Friday that the investigation, which was launched on the orders of President Donald Trump, focused on two issues. First, Vietnam deliberately underestimated its currency dang, thereby cheapening its products abroad and harming U.S. trade.

“Unfair currency practices harm US workers and businesses that compete with artificially low-cost Vietnamese products due to currency undervaluation.” U.S. Trade Representative Robert Lightizer quoted the media as saying.

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Washington also wants to investigate Vietnam’s import of illegally harvested or traded timber. “Harm to the environment and unfair to U.S. workers and businesses.”

The investigation is based on Section 301 of the 1974 Trade Act – the same provision used by the Trump administration to start a trade war with China and to impose punitive tariffs on Chinese imports. Washington has used allegations of currency manipulation against China during trade tensions between the world’s two largest economies. Last year, the U.S. hired a trade war rival as a currency manipulator, but eventually removed Beijing from the list because the two sides were close to a trade pact.

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Vietnam is now one of the 10 largest trading partners of the US, but at the same time has the fourth largest trade surplus with it. The U.S. trade deficit with Asian countries reached nearly $ 35 billion by July, surpassing only China, Mexico and Switzerland.

Vietnam has been on the Treasury Department’s list of currency manipulators since last year. In August, the Treasury determined that Vietnam had devalued its currency in a trade case involving tires, underestimating the dong against the dollar by 4.7 percent.

Hanoi has repeatedly denied allegations that it is not using exchange rates and monetary policy to create unfair competitive advantages in international trade.

There is Vietnam Will be considered He was one of the big winners in the US-China trade conflict, as some producers decided to move their operations to the country to avoid tariffs. While Washington’s action against Vietnam is likely to cause damage to those manufacturers, the investigation is unlikely to be completed before the election, as it usually takes months.

For more articles on Economy & Finance visit Business Division of the RT

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