5 days ago
Vietnam trade beats estimates as buyers race Trump tariffs
FILE PHOTO: Coffee seedlings in the greenhouse at the Western Highlands Agro-Forestry Scientific Technical Institute in Buon Ma Thuot, Vietnam, on Tuesday, November 28, 2023. Vietnam is an export powerhouse that sells everything from coffee and clothing to engine parts. - Bloomberg
HANOI: Vietnam's exports jumped more than expected in July, with buyers racing to avoid a 20 per cent tariff on the country's exports to the US set to take effect on Aug. 7.
Exports rose 16 per cent in July from a year earlier to US$42.3 billion, the statistics office said in a statement, beating expectations of 14 per cent growth. Imports rose 17.8 per cent in the period to US$40 billion, more than the 15.2 per cent forecast. The trade surplus was US$2.27 billion, versus US$2.83 billion released in June.
The South-East Asian nation, an export powerhouse that sells everything from coffee and clothing to engine parts, has been shipping more goods this year to buyers aiming to avoid US President Donald Trump's tariffs. The country was initially threatened with a 46 per cent import levy, though that has been lowered to 20 per cent, just one percentage point more than for neighbours Indonesia, Malaysia, the Philippines and Thailand.
The government said in a statement that the trade negotiators are working to "actively continue' talks with Washington. It also reiterated plans to diversify its markets, aiming for trade agreements with the Middle East and India, while increasing domestic consumption of Vietnamese goods.
Net exports to the US account for roughly a fifth of Vietnam's gross domestic product, and the tariffs pose a threat to factories which have boomed as companies have diversified their supply chains from China.
The data was generally positive, with consumer prices rising 3.19 per cent on year, slower than the 3.40 per cent economist estimate and the 3.57 per cent pace of June. Industrial production rose 8.5 per cent on year, and 0.5 per cent compared with June.
Commodity exports also gained, with coffee exports rising to 103,000 tonnes, a 34.6 per cent rise on a year earlier.
The economy has been powering along in 2025, with gross domestic product rising 7.96 per cent in the April-June period from a year earlier, according to data released last month. The government is aiming for eight per cent growth in 2025, though it's unclear whether the new US tariffs will derail that push. - Bloomberg
