A major market with many challenges
Seafood is one of Vietnam's key export items to the US. According to data from the Vietnam Association of Seafood Exporters and Producers (VASEP), Vietnam's seafood export revenue to the US increased by 161% in October and 40% in November.
However, shrimp, the main export product to the US, has been continuing to face anti-dumping measures from this market. In late November 2023, the US Department of Commerce initiated an investigation into countervailing duties on frozen warm-water shrimp imported from Vietnam. Previously, in 2013, the US had launched an anti-subsidy investigation on Vietnamese shrimp but ended it without imposing tariffs as there was no evidence of harm to the US domestic industry.
Regarding the countervailing investigation, in late October, the US issued its final ruling on the case. As a result, the countervailing duty rate for the mandatory respondents and other shrimp-exporting companies from Vietnam was 2.84%, which was significantly lower than those for other investigated countries (including Ecuador, India, and Indonesia). Specifically, the countervailing duty rates for India were 5.77-5.87%, and for Ecuador were 3.57-4.41%. Evidence from the shrimp industry showed that despite being a top market for Vietnamese goods, the US has been setting up numerous barriers for Vietnamese products.
According to statistics from the General Statistics Office, in the first 11 months of 2024, the US remained Vietnam's largest export market with a turnover of 108.9 billion USD, a year-on-year increase of 23.9%; imports from the US reached 13.5 billion USD, up 7.3%; and Vietnam’s trade surplus with the US reached 95.4 billion USD, an increase of 26.7% compared to the same period in 2023.
Sharing about the potential of the US market for Vietnamese goods, Ta Hoang Linh, Director of the Europe-Americas Market Department (under the Ministry of Industry and Trade), stated that the official declaration of upgrading the relationship to a comprehensive strategic partnership in September 2023 has created a solid foundation, helping to deepen and make the cooperation between the two countries more substantive in all pillars, with the economic-trade-investment pillar continuing to play a central role in driving the bilateral relationship.
The US market has great demand for many Vietnamese goods, from agricultural and seafood products to consumer goods and electronics. For example, in June 2024, the first batch of green-skinned mangoes from Can Tho was shipped to the US by air, with the exporter of Vina T&T Group, a well-known fruit exporter from Vietnam. This was the first batch of mangoes from Can Tho, but Vina T&T Group has been consistently exporting containers of agricultural products every week. These overwhelming orders to various markets, including the US, have contributed to nearly 7 billion USD in export turnover for fruit and vegetables last year.
Thorough preparations to face obstacles
In addition to the bright spots, the US is also considered a market with many barriers for Vietnamese goods. According to statistics from the World Trade Organisation (WTO), the US is currently the leading country in the world in investigating and applying trade defence measures, and it is also the country that investigates and applies the most trade defence measures against Vietnamese exports. To date, this country has initiated 64 investigation cases out of the total of 267 investigations conducted by foreign countries against Vietnam (accounting for 25%), including 28 anti-dumping cases, 11 anti-subsidy cases, 22 cases of circumvention of tariffs, and 03 safeguard cases.
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Vietnamese goods need to make efforts to meet the requirements of the market. |
Most recently, on November 20, the US issued a decision to apply global safeguard measures on two products including polyester staple fibres and hard capsule shells imported.
Do Ngoc Hung, Trade Counsellor and Head of the Vietnam Trade Office in the US, stated that with the trade deficit ranking third among all of the US partners, Vietnam faces the risk of being subject to the same tariff as China at the initial stage (15%), which could possibly increase if the trade deficit does not improve and the agreements between Vietnam and the US are not fully implemented. What is concerning is that this will be applied to all exports from Vietnam, not just goods related to China (such as investments, raw materials, labour, etc.). Therefore, the immediate task is to address the trade deficit issue, although fundamentally, this reflects the complementary nature of each country's foreign trade structure rather than direct competition.
Regarding the industries, VASEP Communications Director Le Hang advised that exported seafood products must fully comply with the regulations of the US Food and Drug Administration (FDA), including standards on hygiene, food safety, and disease prevention. Additionally, businesses need to ensure sustainable production standards and strict quality control from the farming to processing stages in order to meet the increasingly high demands of the US market.
Customers and consumers in the US are increasingly concerned about sustainability, environmental protection, and social responsibility. Therefore, Vietnamese seafood companies should adopt sustainable farming practices such as clean shrimp farming, and cultivate seafood according to international standards (GlobalGAP, ASC, MSC) to enhance their reputation and meet the growing demands of the market.
From the perspective of experts, Assoc. Prof. Dr Dinh Trong Thinh, an economist, stated that the re-election of Donald Trump as US President would have significant impacts on the import-export activities of various countries, including Vietnam. His policies focus on the policy of "America First". Therefore, there could be higher tariffs imposed on imports from certain countries.
Additionally, the US market still has stringent requirements for goods to ensure that exports meet their standards. Therefore, Vietnam must strive to meet the standards set by the US to maintain its market access.
However, the higher tariffs imposed on China could lead to a strong trend of Chinese investment flowing into Vietnam. In some cases, the intent may be to use Vietnam as a "transshipment" point for trade fraud and tax evasion, leading to the risk of receiving the transfer of numerous investment projects from China. This could pose a significant risk in the near future, especially since Vietnam currently has no measures to restrict investment from a specific country under its existing policies. Therefore, relevant ministries, industries, and local authorities need to strengthen the monitoring and approval of new investment projects and carefully screen investment capital to avoid Vietnam becoming a transshipment point. The sectors most affected by this could include textiles, footwear, seafood, electronics, and furniture.
