The U.S. is in a dilemma about whether to upgrade the non-market economy status of Vietnam to that of a market economy. This would align with President Joe Biden’s goal to make the Southeast Asian manufacturing hub a ‘friend-shoring’ destination for the U.S. amid efforts to diversify supply chains away from China. If the status upgrade is accepted by the U.S. Department of Commerce, it will mean an end to high tax (anti-dumping and countervailing duty) on Vietnamese imports in the U.S.
U.S. President Joe Biden’s efforts to strengthen ties with Vietnam faced a hurdle this week as discussions unfolded regarding the potential upgrade of the country to market economy status.
The move, aimed at reducing anti-dumping duties on Vietnamese imports, has sparked debate among trade experts, highlighting the delicate balance between strategic alliances and domestic interests.
The U.S. Department of Commerce will complete their review in late July this year.
Key points of contention
At the heart of the matter lies the question of whether Vietnam, which is governed by the Communist Party of Vietnam (CPV), has transitioned sufficiently towards a market-driven economy. Advocates, including representatives from Vietnam’s Ministry of Industry and Trade (MOIT), point to the nation’s progress across various economic indicators, arguing that it meets the criteria set by the US Commerce Department for such a status upgrade. They emphasize Vietnam’s…
