How will Vietnam cope with the impact of the US-China trade war?

Abstract

In the short term, Vietnam may benefit from the US-China trade war through replacing Vietnam’s Chinese exports of goods to the US market and the relocation of China-based manufacturers to Vietnam. The Vietnamese government's strategy to address these external trade tensions is to enhance macro-economic stability, mitigate exchange rate volatility, and participate in trade agreements to maintain export growth. However, in the long term, the US-China trade war presents challenges to Vietnam's export-led and foreign investment-led growth model. Vietnam needs to adopt economic policies to achieve a truly market-based economy and improve public investment to maintain and enhance the growth momentum.