Vietnam currently has the fourth-largest trade surplus with the United States, according to data released earlier this week.
The U.S. trade deficit with the Southeast Asian industrial hub exceeded $110 billion in the first 11 months of 2024, up nearly 18% from the previous year, largely due to a record decline in the U.S. currency against the dollar.
The country, which is ruled by a communist regime, ranks third behind China, the European Union and Mexico, the data shows. This is a concern for Hanoi as it increases risk President-elect Donald Trump imposes tariffs All imported products are subject to tax rates of up to 20%.
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This risk has been heightened by the sharp depreciation of the Vietnamese Dong in recent months, which has brought the Dong to near record lows against the U.S. dollar.
Pay attention to exchange rate manipulation
The trend is closely watched by Washington as Vietnam is among the countries under scrutiny for potential currency manipulation.
Vietnam counts the United States as its largest market and is home to large export-focused industrial operations by U.S. multinationals such as Apple, Google, Nike and Intel.
The latest seasonally adjusted trade data showed that Vietnam's commercial surplus with the United States totaled US$111.6 billion from January to November, up from US$94.8 billion in the same period in 2023. , which is US$113.1 billion.
Adjusted data showed that the trade deficit widened by another $11.3 billion in November, accelerating from October as Vietnam's exports to the United States increased, possibly supported by the weakness of the Vietnamese dong.
Leif Schneider, head of international law firm Luther in Vietnam, said: “If the United States believes that Vietnam is deliberately keeping the dong low to gain an unfair trade advantage, it may trigger new accusations of currency manipulation.”
Trump ends his first term in White House with Treasury Department statement Vietnam and Switzerland designated as currency manipulators Intervene in the market to weaken the value of its currency.
Vietnam's central bank said it was prepared to intervene in the foreign exchange market to prevent exchange rate fluctuations from adversely affecting the economy and had sold U.S. dollars to strengthen the Vietnamese dong.
On Tuesday, ahead of the release of new trade data, the bank said it would monitor Trump's policies and make adjustments accordingly.
The Vietnamese dong’s recent depreciation against the U.S. dollar has been broadly in line with other major currencies.
- Reuters Additional editing by Jim Pollard
See also:
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Amid tensions between China and the U.S., chipmakers flee China for Vietnam
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Vietnam's exports and industrial production grow significantly
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