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Vietnam’s Economy Gets Boost from US-China Trade War
Vietnam is expecting solid growth this year as it receives an economic lift from the U.S.-China trade war.
Vietnamese officials have predicted the country's $300 billion economy will grow between 6.6 to 6.8 percent this year. SSI Research, based in Hanoi, reported the estimate.
The research company said strength in manufacturing and exports were mainly responsible for the 2019 prediction. Both areas have experienced growth over the past year as companies moved production to Vietnam from China.
Also, Vietnam's past economy, measured by gross domestic product, or GDP, proved to be larger than had been thought. "They found that they understated their GDP itself," Singapore-based economist Song Seng Wun told VOA.
Earnings results from some companies were not included in earlier GDP estimates. So in August, the government raised its reported GDP by 25.4 percent for money discovered between 2010 and 2017, Vietnamese media reported.
Vietnam has depended heavily on export manufacturing since the late 1980s. That policy has helped Vietnam become one of Asia's fastest-growing economies.
Economic experts say Vietnam is also getting a lift from companies seeking to find a way around problems caused by U.S.-China trade tension.
Some companies facing U.S. tariffs on goods shipped from China are moving business to Vietnam. Some of those companies can produce and ship the same goods from Vietnam without paying U.S. tariffs on a total of $550 billion in goods now made in China.
Frederick Burke is a lawyer with Baker McKenzie in Ho Chi Minh City. He told VOA that such market moves to avoid tariffs are now becoming "a real thing" in Vietnam. "It's really happening, so that's going to be driving up prices and driving up GDP a bit," Burke said.
One example is Chinese-based wireless earphone maker GoerTek. The company plans to move production of Apple AirPods to Vietnam for an investment of $260 million, SSI Research said in July. In another case, Google plans to move Pixel smartphone production from China to Vietnam, the Nikkei Asian Review reported in August. Google has not commented on the report.
Kevin Snowball is the Chief Investment Officer for PXP Vietnam Asset Management in Ho Chi Minh City. He said some companies are even trying to send goods made in China to Vietnam and then re-labeling them as "made in Vietnam" for shipment to the U.S.
Burke says the increase in investment by manufacturers attempting to avoid China is putting pressure on land, labor and organizational resources.
Low labor costs, pro-investment policies and a lack of trade tension with the U.S. has readied Vietnam to enter into a trade agreement with the European Union. Vietnam joined the 11-country Trans Pacific Partnership free trade deal this year.
Experts say Vietnam is also seeking to increase investments by software companies and computer parts manufacturers. Intel, Samsung Electronics and Foxconn Technology have all made major hardware investments.
Vietnam grew 7.1 percent in 2018, the highest level in 11 years. Snowball says a growth rate in the high sixes this year would be considered a "strong" showing.
I'm Bryan Lynn.

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avoid [ə'vɔid]

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vt. 避免,逃避

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measured ['meʒəd]

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adj. 量过的,慎重的,基于标准的,有韵律的 动词me

 
credit ['kredit]

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n. 信用,荣誉,贷款,学分,赞扬,赊欠,贷方

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financing [fai'nænsiŋ]

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n. 融资,资金供应 动词finance的现在分词

 
pressure ['preʃə]

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n. 压力,压强,压迫
v. 施压

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n. 恢复,复原,痊愈

 
misery ['mizəri]

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n. 痛苦,悲惨的境遇,苦难

 
evaporate [i'væpəreit]

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v. 蒸发,失去水分,消失

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domestic [də'mestik]

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adj. 国内的,家庭的,驯养的
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prediction [pri'dikʃən]

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n. 预言,预报

 

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