Vietnam-US economic prospects

(VOVworld)- US President Barack Obama is on an official visit to Vietnam, demonstrating closer ties between the two countries. VOV’s editor reviews developments in Vietnam-US economic, trade and investment relations over the past 20 years and looks at future prospects.

Vietnam-US economic prospects - ảnh 1
Boeing President and CEO Ray Conner (front, right) and Vietjet Air CEO Nguyen Thi Phuong Thao sign a 11.3 billion USD deal on May 23 (Photo: VNA)

After Vietnam and the US normalized their diplomatic relations in 1995 and signed a bilateral trade agreement in 2000, two-way trade increased 20 fold to 45 billion USD in 2005. The US has become the 7th largest investor in Vietnam with 720 projects capitalized at 11 billion USD, according to the Ministry of Planning and Investment. These facts demonstrate an impressive development in bilateral trade ties. Vietnamese Ambassador to the US Pham Quang Vinh said: “I believe that economic cooperation will continue. This is one of the pillars and if there are more opportunities, when American companies realize a reforming Vietnam has a more favorable business environment, they will increase their investment in Vietnam. Both countries are working to make the Trans-Pacific Partnership (TPP) agreement come into force, creating momentum for strengthened trade ties within the TPP framework and between Vietnam and the US”.

The World Bank estimates that once the TPP agreement takes effect, two-way trade may jump to 72 billion USD by 2020 and Vietnam’s exports may increase by 30% from now to 2030. Deputy Minister of Trade and Industry Tran Quoc Khanh told VOV: “When the TPP agreement takes effect, almost all  duties on imports into the US will be removed, benefiting Vietnamese goods like footwear, garments and textiles, seafood, furniture, and consumer items. US import value will increase to 2.5 trillion USD. Vietnam will also eliminate tariffs for imports from the US. That’s why American companies are enthusiastic about the TPP.

American companies are steadily expanding their presence in Vietnam and other markets in the ASEAN and Asia Pacific regions.

President Obama is accompanied by business people who have come to Vietnam to sign deals, signaling bright economic prospects for Vietnam and the US.