Vietnam- US trade turnover surges 170 times in 25-year period
Vietnam has become the 27th largest export market and 16th largest trading partner of the United States, while two-way trade turnover has increased by nearly 170 times from a figure of US$450 million in 1994, to approximately US$76 billion in 2019.
Information regarding mutual trade was released during the US-Vietnam Business Summit 2020 titled “Trusted Partners Prospering Together” held on October 9 in Hanoi by President of Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc.
Recent shifts in global supply chains has served to boost the nation’s standing from 12th to ninth among the largest exporting countries to the US market. Indeed, the economies of both countries are increasingly supplementary, the VCCI leader emphasized.
The past few years has seen the nation export key products to the US market, including seafood, cashew nuts, garments and textiles, along with leather and footwear, while the US is viewed as a plentiful supply source to meet Vietnamese import demand. Notable import items include machinery, high-tech equipment, aviation equipment, telecommunications, energy, liquefied gas, and raw agricultural materials.
At present, 130 countries and territories invest in the country, with the US being the second largest investor in 2019 with a total value of US$93.4 million, accounting for 18.4% of outward investment capital. During the first quarter of the year, the US represented the leading country with US$20.1 million, making up 40.8% of the overall figure.
Loc affirmed that investment and business projects launched by US firms in the country have played an increasingly important role in Vietnamese development, therefore helping the nation to become a more active participant in the global supply chain.
According to Deputy Minister of Planning and Investment Tran Duy Dong, US businesses have been present in the nation since the two countries normalized diplomatic ties, with typical projects being successfully ran by the likes of Cargill, Coca-Cola, Caterpillar, and Intel.
"These are important bricks to link the investment relationship between Vietnam and the United States, thereby paving the way for promoting economic co-operation between the two countries towards boosting production and building a brand on a sustainable basis in the global value chain," Deputy Minister Dong noted.
With regard to investment in the nation, the US ranks 11th out of 138 countries and territories, with a total registered investment capital of approximately US$9.4 billion pouring into over 1,000 valid investment projects. The majority of these focus on hotel services and catering, accounting for 46% of total investment capital, and the processing and manufacturing industry, making up 31% of total investment capital.
Most notably, US investment in the country can be calculated at a much larger figure, possibly up to US$15 billion of investment capital. This is due to major firms such as Intel, Coca Cola, Procter & Gamble, Chevron, and ConocoPhillips entering the Vietnamese market through its branches and subsidiaries registered in a third country, such as British Virgin Islands, Singapore, and Hong Kong (China).
In addition, a number of large technology corporations like Apple, Google, and Dell, are all invested in the nation through the Original Design Manufacturing (ODM) and Original Equipment Manufacturing (OEM) businesses of their supply chain.
With regard to overseas Vietnamese investment, the US is currently in the top 10 out of 81 countries and territories in terms of investment destinations.
The nation has close to 200 valid investment projects ongoing in the US, with total registered investment capital of roughly US$750 million.
These typical investment projects are largely run by Viettel Military Industry and Telecoms, Vingroup Investment Vietnam JSC, Vietnam Dairy Products Joint Stock Company (Vinamilk), FPT Software Company Limited, An Phat Xanh Plastic JSC, Joint Stock Commercial Bank for Foreign Trade of Vietnam (VCB), and Global Mobifone Technology JSC.
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