It will take about three years for the US-China trade war to take effect on Vietnamese economy, said a newly-released report by the National Centre for Socio-Economic Information and Forecast (NCIF) under Ministry of Planning and Investment (MPI).
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The country’s economy until 2017 stood at US$220 billion. Given the 6.8% growth (expected) this year, the scale could be US$235 billion. With supposed GDP’s growth of 6.5% on average within the next five years, Vietnam economic value would reach US$250.2 billion, US$284 billion and US$302 billion, respectively.
Also, that the US slaps 25% tariffs on imports worth US$34 billion from China would cause an annual loss of VND6,000 billion (US$258 million) for the Vietnamese economy during 2018-2020.
Dr Tran Toan Thang, head of the World Economic Department at NCIF said the effects as forecast remain“relatively low”, despite the peak of GDP growth’s decline of 0.12%. Besides GDP growth, Vietnamese export growth can also be negatively affected by the trade war, Thang said. However, he noted that foreign direct investment flow into the country would hardly be harmed.
The US-China trade war fired its first shot last month when the US slapped 25% duties with US34 billion goods from China, covering 818 sorts of products in the war’s first phase.
The second phase would broaden the tariff slapped on goods worth US$50 billion. The US administration also threats to add another 10% tax on goods worth US$200 billion from the Asian giant, a scenario that makes the total value of goods from China subjecting to trade war equivalent to 50% of its exports to the US.
Dr. Luu Bich Ho, former head of the Development Strategy Institute under the MPI said the trade war is in its initial phase, so the it's hard to forecast its impact.
In that context, Vietnam would hold on and boost the growth of some key sectors such as agriculture, tourism, and manufacturing, with the aim to increase the export flow. “It is essential to avoid Chinese goods disguised in the “made-in-Vietnam” cover to enter other countries,” Ho told Hanoitimes.
He also noted some products imported from China like steel, consumer goods and technology items should be strictly monitored.
