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    Sino US Trade Relations Are Tense And Vietnamese Enterprises Are On Pins And Needles.

    2019/5/24 17:28:00 8425

    Sino US Trade FrictionVietnamTextile And ClothingTariffsInternational Observation

    According to the situation provided by Vietnam, China and the US have increased tariffs to make Vietnamese enterprises restless. The continued depreciation of the renminbi, the rise in the US dollar exchange rate and the huge fluctuation in the exchange rate between the US dollar and the Vietnamese shield have had a huge impact on Vietnam's import and export enterprises.

    Although the Vietnamese shield's depreciation of the US dollar has benefited Vietnam's export enterprises, the decline in the import country's exchange rate has resulted in an increase in import costs and difficulties in export sales, and Vietnamese enterprises are no exception.

    The escalation of Sino US trade friction has seriously affected the textile and garment industry in Vietnam. Vietnamese enterprises need to import cotton to produce cotton yarns and export them, in which large quantities of raw materials should be imported from China. Cotton import orders signed in early Vietnam are in a predicament. Although cotton has not yet arrived at ports, cotton prices have fallen by more than 10%.

    When China's textile and clothing exports to the United States were imposed high tariffs, the export of US cotton would also be reduced, followed by Vietnam's demand for imports of cotton yarn also declined. The market believes that the escalation of Sino US trade war will make Vietnam and other countries Von de Leigh, but this is not the case.

    From other angles, Chinese enterprises will shift production to Vietnam and other countries to avoid high tariffs, so Vietnamese enterprises must compete fiercely with those countries with low labor costs. More importantly, China will dominate the import of Vietnamese raw materials. If China fails to export textile and clothing to the United States, it may reduce textile production and meet domestic supply, so Vietnam will face great difficulties. The decline in global textile production will also have a negative impact on Vietnamese local enterprises.

    After years of rapid expansion, the export of Vietnamese clothing began to slow down, and economic growth in Vietnam and the world could decline, especially in 2019. At present, Vietnam's textile and clothing exports can still maintain a positive growth because the products are still competitive and Vietnam is deeply integrated into the global supply system. In the short term, the deterioration of Sino US trade relations has brought a negative impact on Vietnam's textile and garment industry, but Vietnam has signed many free trade agreements, and domestic enterprises still have the opportunity to seize more market share in Asia and developed countries.

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