Products from Vietnam have become more popular in the United States than ever before.
U.S. imports from the Southeast Asian nation increased 36 percent last year to $67 billion, the U.S. Census Bureau reported. This represents the highest increase in a single year since 2003.
Vietnam is a major supplier of electronic products, furniture, clothing, footwear, and fish to the United States. It also is a major exporter of coffee, rice, and other foods.
Michael Ryan is the director of economics at IHS Markit Economics, an investment research service. He told VOA the latest increase shows Vietnam is making a “massive reorientation” in trade toward the U.S. market.
“The United States has become far and away the most important driver of Vietnam’s export engine, accounting for two-thirds of Vietnam’s total export growth in 2019,” Ryan said.
Many businesses have been moving to Vietnam to reduce their dependence on China, where it has become more costly or harder to do business for several reasons. These include the trade war between the U.S. and China, higher operating costs and the spread of the new coronavirus.
After U.S. officials asked Vietnam buy more American goods, the country announced in March it would buy $3 billion worth of farm goods. That promise came after Vietnam said it would buy American-made airplanes.
Less than a year ago, U.S. President Donald Trump threatened Vietnam with tariffs. He accused Vietnam of abusing the trading system, but did not say how. Trump said he wants to increase U.S. exports to Vietnam to help make up for the much larger levels of imported goods.
Instead, the difference between what the U.S. imports from Vietnam compared to the U.S. exports has increased every year from 2008 to 2019, the Census Bureau found. While economists say a trade balance is not the only way to measure trade success, Vietnam is exporting more because of the U.S. trade war with China.
Jing Wu is an assistant professor of business at the Chinese University of Hong Kong. He told VOA that the trade war did not get companies to move to the United States. Instead, it caused many to move to other nations, like Vietnam, he said.
Wu and others at the university’s business school studied the relationship between trade uncertainty and the movement of companies.
Their research supported the idea that many companies seek out new markets during a trade war. As examples, they named major companies including Apple, Chevron, and Victoria's Secret owner L Brands, which all have moved more business to Vietnam.
Their study was carried out before the arrival of COVID-19, the coronavirus first reported in China that has since spread around the world. The virus has greatly damaged supply chains and economic activity around the world.
But some businesses say they expect to be active in Vietnam after the crisis and continue to invest there. For example, the U.S.-ASEAN Business Council recently acted on plans to send business representatives to Vietnam.
I’m Bryan Lynn.
VOA News reported on this story. Bryan Lynn adapted the report for Learning English. George Grow was the editor.
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Words in This Story
furniture – n. objects such as chairs, tables and beds that are put inside rooms or buildings
reorientation – n. the action of changing the focus or direction of something
account for – v. to be part of a total number of something
tariff – n. a tax on goods coming into or leaving a country
uncertainty – n. the state of not being sure about or not being able to decide something
supply chain – n. the processes involved in the production and sales of a product or products