TPO - The US is expanding its positive economic relationship with Vietnam, at the highest level of the Government. Vietnam can be seen as a useful partner in helping the US escape its dependence on cheap goods.
TPO - The US is expanding its positive economic relationship with Vietnam, at the highest level of the Government. Vietnam can be seen as a useful partner in helping the US escape its dependence on cheap goods.
“We believe that what is about to happen is actually normal.”
With the US presidential election over, all eyes are on what the new Donald Trump administration will do when it takes office in January 2025. Many countries are concerned about the impact this event will have on their economies. However, VinaCapital experts believe that these risks have been exaggerated.
The first and most important reason is that the recent US presidential election recorded a lot of exaggerated statements and exaggerated information from the media, making voters feel that it was information for campaigning instead of objective information. "We believe that what is about to happen is actually normal," said VinaCapital's expert.
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Mr. Trump has shown that he will not put ideals above economics. |
Both presidential candidates have pledged to bring manufacturing jobs back to the United States if they win. In fact, Mr. Trump has assembled a team of highly knowledgeable and talented economic advisers who are fully aware of the negative consequences of imposing heavy tariffs on goods imported into the United States. These negative consequences include discouraging the return of manufacturing jobs to the United States because high tariffs drive up the value of the dollar.
Vice President-elect JD Vance also showed his economic savvy by pointing out that the role of the US dollar as a global reserve currency has led to an overvalued US dollar, making it economically unviable to bring manufacturing jobs back to the US. Heavy tariffs would exacerbate this problem.
A closer-to-home concern is that the US economy is headed for its worst “stagflation” (high inflation and low economic growth) since the 1970s for a number of reasons, including the rapid rise in US public debt.
Mr Trump has shown that he will not put ideology above economics, so it is unlikely that he will take actions that will increase inflation, especially when the main reason for his re-election was voter dissatisfaction with the economy.
What is the impact on Vietnam?
VinaCapital experts said that the US is expanding its positive economic relationship with Vietnam, at the highest level of the US Government. Moreover, Mr. Trump is a populist and Vietnam is highly regarded by American voters. We do not see any opposition to the consumption of “made in Vietnam” products from American consumers.
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Vietnam's trade surplus with the US can be easily addressed by purchasing high-value products such as LNG from the US. |
In fact, Vietnam can be seen as a useful partner in helping the US move away from its dependence on cheap goods, as high wages and a scarcity of skilled workers will limit US efforts to bring back manufacturing jobs, focusing on high-value-added products.
According to VinaCapital experts, Mr. Trump did not really think he would win the 2016 presidential election. As a result, he entered the White House not fully prepared for the challenges ahead - according to his own account and interviews. This time, Mr. Trump has a better understanding of how the government works and has successful business people to advise him. So he will have a more focused approach to trade issues.
Vietnam had a trade surplus of about $100 billion with the US last year, making it the country with the third largest trade balance with the US, after China and Mexico.
“VinaCapital believes that Vietnam will maintain its stable growth momentum under the Trump administration. Although the US may impose new tariffs on imported goods, we believe that it is unlikely that the US will impose heavy tariffs (20-30%) on imported goods from Vietnam,” said a representative of VinaCapital.
Source: https://tienphong.vn/ong-trump-dac-cu-tong-thong-my-tac-dong-gi-den-kinh-te-viet-nam-post1689610.tpo
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