Vietnam Economic News: 30.11 – 7.12.2024
Summary of Vietnam Economic News: 30.11 - 7.12.2024
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Summary of Vietnam Economic News: 30.11 - 7.12.2024 ---
VIETNAM'S SOARING US TRADE SURPLUS STOKES NEW FEARS OF TRUMP TARIFFS
Reuters News – 6 December 2024
Vietnam is vulnerable to becoming the new Trump administration's next target for tariffs as data shows its trade surplus with the United States ballooning, industry executives and analysts said. Vietnam, home to large industrial operations of U.S. multinationals such as Apple, Google, Nike and Intel, has the fourth highest commercial surplus with the United States, topped only by China, the European Union and Mexico. U.S. trade data released on Thursday showed the country's deficit with Vietnam reached $102 billion in the first ten months of this year, nearly a 20% increase over the same period in 2023. "For Trump the main metric is the trade deficit, and the Vietnam number is bad," said Deborah Elms, head of trade policy at the Asia-based Hinrich Foundation. "Vietnam is an ideal candidate for early action because it cannot easily retaliate," she said. President-elect Donald Trump, who takes office in January, threatened tariffs of up to 20% on all U.S. imports during his election campaign. His son Eric, a top adviser, has cited Vietnam among countries that "ripped off" the U.S., according to a video shown last week at a business conference in Hanoi organised by American Chambers of Commerce. At the event, several businessmen and trade association representatives expressed concern about possible tariffs on Vietnam. "The new tariffs are one of the biggest concerns for the Korean industry in Vietnam," Hong Sun, head of South Korea's Chamber of Commerce in Vietnam, told the conference. South Korea's Samsung Electronics is a major exporter of smartphones and electronic devices to the U.S. from Vietnam Vietnam's foreign affairs ministry did not reply to a request for comment on potential tariffs, but Vietnamese officials have repeatedly urged Washington to maintain seamless trade.
TEMU'S OPERATIONS SUSPENDED IN VIETNAM
Dow Jones Institutional News – 6 December 2024
Chinese online retailer Temu has been ordered to suspend operations in Vietnam after it missed a deadline for registering its business in the Southeast Asian country. Vietnam's Ministry of Industry and Trade asked Temu to cease sales in the country until a licensing process is completed, state media outlet Vietnam News Agency reported Thursday. Temu, a bargain-goods retail platform owned by Chinese e-commerce giant PDD Holdings, launched in Vietnam in October. It had been required to complete a local registration process by the end of November. A company spokesperson said Thursday that it was working with ministry officials on the matter and that it had submitted all required documents. Temu has been seeking to expand to markets beyond the U.S., where its app has gained spectacular popularity with American consumers in recent years. It currently operates in more than 80 countries, according to its website. In Southeast Asia, Temu this year also launched in Thailand and Brunei, taking its availability in the region to five countries.
VIETNAM NOV EXPORTS RISE 8.2% Y/Y, INDUSTRIAL PRODUCTION UP 8.9% Y/Y
Reuters News – 5 December 2024
Vietnam's exports in November rose 8.2% from a year earlier to $33.73 billion, led by shipments of electronics and garments, while industrial production increased 8.9%, government data showed on Friday. Imports rose an annual 9.8% to $32.67 billion, the General Statistics Office (GSO) said in a report, leading to a trade surplus of $1.06 billion for November. Vietnam is on track for a faster economic growth this year, backed by strong exports and robust foreign investment inflows. In October, the prime minister said growth in 2024 would accelerate to 6.8% to 7.0% from an expansion of 5.05% last year. Friday's data showed consumer prices rose 2.77% in November from a year earlier. Average consumer prices rose 3.69% in the first 11 months of this year, lower than the government's full-year target of 4.5%. Economic research firm Oxford Economics said on Friday that inflation is expected to remain soft next year at 3.5%, a slight moderation from its forecast of 3.6% for 2024. "While a stronger US dollar threatens a weaker currency, and higher inflation, it is likely that the authorities will continue to defend the currency," Oxford Economics said in a note. Retail sales in November rose 8.8% from a year earlier, the GSO added. Foreign investment pledges to Vietnam in the first 11 months of this year reached $27.3 billion, led by investors from Singapore, South Korea and China, it added.
NVIDIA TO OPEN VIETNAM RESEARCH AND DEVELOPMENT CENTER TO BOLSTER AI DEVELOPMENT
Dow Jones Institutional News – 6 December 2024
NVIDIA announced today it is opening its first Vietnam research and development center, signalling its confidence in the country's bright artificial intelligence future. The company is collaborating with the Vietnamese government to establish its new Vietnam Research and Development Center focused on AI. NVIDIA will use the R&D center to focus on software development, capitalising on the country's strong talent pool of STEM engineers, and to engage industry leaders, startups, government agencies, universities and students to accelerate the adoption of AI. "We are delighted to open NVIDIA's R&D center to accelerate Vietnam's AI journey," said Jensen Huang, founder and CEO of NVIDIA. "With our expertise in AI development, we will partner with a vibrant ecosystem of researchers, startups and enterprise organizations to build incredible AI right here in Vietnam." The Vietnam R&D Center will develop valuable platforms for NVIDIA and partners to nurture AI innovation. Researchers and startups will be able to use this infrastructure to develop AI applications for key industries such as healthcare, education, transportation and finance.
With the country's rapid expansion in manufacturing for technology, automotive, electronics and textiles, Vietnam has become one of the world's fastest-growing economies. Its AI market has also been growing in recent years, backed by technological advancements, government support and greater integration of AI in various industries. Since 2021, Vietnam has promoted AI development as part of its digital transformation strategy with the goal of fostering innovation, building a robust AI ecosystem and positioning the country as a regional leader in R&D. "The government of Vietnam is focused on innovation as one of the key elements of its development strategy," said Vietnam Prime Minister Pham Minh Chinh. "With this strategic partnership, the Vietnamese government and NVIDIA are committed to jointly promoting the strong development of AI technology in Vietnam and creating a bright future for the innovation ecosystem and high-tech industry in Southeast Asia." NVIDIA has been investing in Vietnam's technology ecosystem for the last eight years. The company is engaged with more than 100 Vietnamese AI startups as part of its Inception program in addition to 65 universities within the country. Last year, NVIDIA began collaborating with FPT Smart Cloud as its first Vietnamese cloud partner.