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Oct 26, 2020 / 17:03

Vietnam PM dismisses deliberate devaluation of currency

A devaluation of the VND would have serious consequences on macro-economic stability, the trust of investors and the people, resulting in a big loss to the economy, Prime Minister Nguyen Xuan Phuc has said.

Vietnam’s flexible management of its monetary policy is to ensure a stable macro-economic environment and mitigates negative impacts from external shocks to the economy, not for unfair trade gains or to support any specific sectors, according to Prime Minister Nguyen Xuan Phuc.

 Prime Minister Nguyen Xuan Phuc. Source: VGP. 

In fact, a devaluation of the Vietnamese dong (VND) would have serious consequences on macro-economic stability, the trust of investors and the people, resulting in a big loss to the economy, Mr. Phuc said in a meeting with a US delegation led by US International Development Finance Corporation (DFC) CEO Adam Boehler on October 26.

The Vietnam PM asked Mr. Boehler to send the message to US President Donald Trump, the Office of the US Trade Representative (USTR) and other agencies in supporting Vietnam to realize the joint action plan agreed late 2019 towards a more balanced trade relationship between the two countries.

Mr. Phuc expected the US to have a more objective view from Vietnam’s perspective to ensure mutual benefits that are in line with US commitment for a strong, independent and prosperous Vietnam.

In early October, the USTR announced its decision to initiate an investigation to determine whether an undervalued VND may cause negative impacts on US commerce.  

 Overview of the meeting. Source: VGP. 

In this regard, Mr. Boehler said the US pays attention to monetary and exchange rate policies of its trading partners, and is willing to work with Vietnamese agencies to resolve the issue.

Mr. Boehler informed the DFC is planning for a major investment in Vietnam and US Export – Import Bank (US Eximbank) would facilitate business plans in the country soon, especially in the fields of renewable energy, transportation, healthcare, agriculture, 5G, among others.

As the Vietnam – US relations are growing strongly, the US is committed to continue supporting Vietnam in various fields, including the latter’s view on the South China Sea.

Prime Minister Phuc said the US remains Vietnam’s partner of top priority and expects to further its comprehensive partnership with the US, especially in trade and investment.

Since 1995, bilateral trade has increased by 170-fold, and US export growth to Vietnam is among the highest among its trading partners in Southeast Asia.

Moreover, the US is among top 10 largest investors in Vietnam. The Vietnamese government gives priority to supporting US enterprises doing long-term business in the country, stated Mr. Phuc, adding Vietnam is open its door for US investors amid a shift in regional supply chains.

Mr. Phuc proposed DFC soon invest in major projects in Vietnam, including the North – South expressway or Long Thanh International Airport.