The escalating US-China trade war has affected many other countries, including Vietnam, said Prof. Liu Ying of the Chongyang Institute for Financial Studies under the Renmin University of China.

Illustrative image (Source: VNA)

Liu said that due to the world economy’s demand, the US’ increase of tax rate applied on Chinese goods will push production costs, thus countries having business and trade relations with the US, including Vietnam, will be affected.

According to Liu, both China and Vietnam should stimulate domestic consumption and foster economic and trade relations with each other as well as with ASEAN countries.

Currently, China-ASEAN trade has exceeded 500 billion USD, while the trade value between China and Vietnam has reached nearly 150 billion USD with rapid growth, Liu noted.

Liu asserted that with the sound neighbourliness, China and Vietnam have good conditions to promote bilateral trade ties.

Meanwhile, for the ASEAN, it is necessary to enhance trade and financial cooperation by increasing investment in infrastructure development, thus boosting the growth of the regional economy, she said.

The expert said that the US has launched trade wars with China, Europe and Japan, which has hindered the development of the global trade and economy. The World Bank and the International Monetary Fund have both lowered the global economic growth in 2019.

Liu stressed that international trade is an important motivation for the global economic growth, but the trade unilateralism and protectionism have been curbing the trans-border capital flow.

In the first half of 2018, the flow of trans-border capital reduced by 41 percent, while the Baltic Dry Index, which reflects the world trade wealth, also dropped to 66 percent. Meanwhile, the US stock market is going down.

Liu underlined the need to roll out drastic measures to end trade conflicts between the US and China – the two driving forces of the world economic growth.