Investment by Chinese enterprises in Vietnam under different modes, from FDI (foreign direct investment) to M&As (merger & acquisition), is on the rise amid the US-China trade war. 

VietNamNet Bridge - Chinese goods, especially chemicals and plastics, are expected to increase in Vietnam.

Vietnam may become a place for Chinese goods to transit before going to the US.

VietNamNet Bridge - Economists have warned that the Vietnam economy will “bear a lot of damage from the US-China trade war”.

VietNamNet Bridge - The manufacturers of phone components and accessories for Apple have sent word intimating that they may relocate factories to Vietnam. 

Vietnam has free trade agreements with Canada, Japan and Mexico (through CPTPP), and plans to sign an FTA with the EU. These will be advantages in the US - China trade war. 

VietNamNet Bridge - Vietnam’s textile & garment industry is reaping the benefits from the China-US trade war.

VietNamNet Bridge - The trade war is driving to FDI (foreign direct investment) flow to other countries, including Vietnam, which will, nevertheless, have to compete fiercely with others to attract the capital.

VietNamNet Bridge - The trade war is facilitating the development of a number of business fields in Vietnam. 

VietNamNet Bridge - Vietnam has opportunities to boost exports and attract investment, but will face big challenges because of the escalating US-China trade war.

VietNamNet Bridge - The US-China trade war could adversely affect Vietnam’s rubber industry as 65 percent of domestic rubber output is exported to China.

VietNamNet Bridge - Analysts say they can see opportunities for Vietnam in the US-China trade war. Signs show that Asian manufacturers are relocating their production bases to Vietnam.

Many Hong Kong businesses want to relocate their production bases to other countries, especially Southeast Asia, in the context of the US-China trade war.

The massive arrival of Chinese enterprises to Vietnam to set up woodwork processing workshops has raised concern that China may exploit Vietnamese origin to export products to the US and avoid high taxes.

Economists have expressed concern about the impact on Vietnam’s economy if the second US tariff package of $200 billion is ratified after September 6, saying that Vietnam’s GDP may decrease by 0.03 percent because of the trade war.

Experts have urged the government to stop accepting deposits in US dollars from the public, saying that this is a necessary to stabilize the forex market and exchange rate, and fight against dollarization.

As GDP relies on exports, in order to avoid the abrasive effects of the China-US trade war, it needs to improve competitiveness and find new markets.

Vietnam has enjoyed a trade surplus with the US over many years. However, the trade balance has now become relatively equal with a series of valuable procurement contracts that Vietnamese enterprises have signed with US manufacturers.

Vietnam’s trade activities still have not been affected significantly by the recent trade tension between the US and China because taxed goods are mostly certain types of  high-technology products. 

Domestic businesses should closely monitor the market situation, prepare to adjust their operations and redefine export markets to avoid negative impacts and capitalise on opportunities from the US-China trade war.