Event category: Vietnam & US
Time: 11/01/2015, 06:00
What will happen to Vietnam’s economy wad be a question that many Vietnamese people raised at the historical moment when the US President Bill Clinton declared the lifting of the embargo against Vietnam, at 5 am February 4, 1994, Hanoi time.
Anticipated and unanticipated happenings in the last 20 years
As Phan Huu Thang, former head of the Ministry of Planning and Investment’s (MPI) commented, the declaration on the normalization of the diplomatic relations with Vietnam was what Vietnam looked forward to, with which both Vietnam and the US can close the past and march towards the future.
Nguyen Dinh Luong, well known in the world as the head of the Vietnamese delegation at the negotiation for the Vietnam-US BTA, who was then the director of the Europe-US Trade Department under the Ministry of Trade, related that during the embargo, he many times had to deal with problems arising when the US discovered Vietnamese products in the US.
In principle, Vietnamese products could not enter the US legally due to the embargo. Therefore, they tried to penetrate the US under the names of other producers.
“Vietnam’s shirts and coffee were very cheap. They were bought by third countries for re-export to the US for profit,” Luong explained.
In 1992, the Vietnamese Trade Representative in Hong Kong said that the US customs wanted to come to Hanoi to examine some apparel consignments which were believed to be exported from HCM City to the US.
Luong then rejected the entry of the US customs officials to Vietnam because Vietnam and the US still did not establish diplomatic relations by that time. He asked the US customs to provide information about the consignments of goods suspected of committing trade fraud for examination.
Luong, when answering US customs, might not imagine that 20 years later, Vietnam’s garment products would enter the US legally with export turnover of $10 billion a year.
Pham Chi Lan, a renowned economist, admitted that she feared Vietnamese enterprises could not take full advantage of the opportunities the BTA can bring to boost exports to the US because of their low capability. However, she later realized that Vietnamese enterprises can exploit the US market well.
In 2014, Vietnam had a trade surplus of $22.4 billion with the US.
The US is now the seventh largest foreign investor out of 101 foreign investors in Vietnam.
Before the BTA took effect, in 2001, the Vietnam-US trade scale was modest, worth $1.5 billion.
“MOT officials dared hope that the two-way trade turnover would increase to $6-7 billion,” Lan said. “But it has climbed to $35 billion.”