Vietnam Nears Trade Deal... Will It Increase Purchases of U.S. Aircraft and LNG?

Vietnam said it had effectively concluded trade negotiations with the United States and submitted its final views. The two countries have spent months negotiating tariffs and non-tariff barriers.

Reuters-Yonhap News

Vietnamese Deputy Prime Minister Pham Gia Tuc said at a U.S.-Vietnam business event in Hanoi on October 14 local time, “We have conveyed our final views to the U.S. side,” adding, “If both sides agree, we will sign the agreement soon.”

The agreement is expected to ease trade uncertainty for Vietnamese exporters once it is signed. Vietnam currently faces the possibility of additional tariffs following U.S. trade investigations. Transshipment and non-tariff barriers have been among the key issues in the negotiations between the two countries.

Michael George DeSombre, U.S. Assistant Secretary of State for East Asian and Pacific Affairs, said in a video message at the same event, “Vietnam now needs to take bold steps to address the trade imbalance.” He said a trade agreement would help ease the trade imbalance between the two countries and stressed that issues involving non-tariff barriers, such as vehicle safety and emissions standards, needed to be resolved.

“I strongly encourage Vietnam to closely review industries in which it limits foreign ownership,” he added. “In particular, it should focus on industries where the foreign ownership cap is below 50%.”

Last month, Vietnamese President To Lam said in an interview with Bloomberg that the two countries were “very close” to concluding a trade agreement. Vietnam has repeatedly pledged to increase purchases of U.S.-made products, including aircraft and liquefied natural gas (LNG), in an effort to reduce its trade surplus with the United States, its largest export market.

Vietnam’s exports to the United States continue to reach record levels. Supported by strong exports, the economy grew 9.95% in the third quarter of this year. Government statistics also show that Vietnam’s trade surplus with the United States totaled $122.6 billion in January-September this year, up 23.8% from the same period last year. Vietnam is considered one of the United States’ trading partners with the largest trade deficits, alongside China, Mexico and Taiwan.

Most Vietnamese products currently imported into the United States are subject to a 12.5% tariff. Additional tariffs may also be imposed depending on the outcome of ongoing U.S. trade investigations into alleged overcapacity and intellectual property infringement. This has increased pressure on the negotiating teams of both countries to conclude a trade agreement as soon as possible.

This content was produced with the assistance of AI translation services.