Kerry’s Visit Reinforces Bilateral Trade Relations

December 20, 2013 Posted by Vietnam Briefing Reading Time: 2 minutes

Dec. 20 – U.S. Secretary of State John Kerry visited Vietnam earlier this week as part of a trip intended to advance Washington’s “Asia Pivot” strategy of rebalancing its economic, diplomatic and military focus in the region.

Part of America’s so-called Asia Pivot strategy involves strengthening U.S. ties beyond long-established allies such as Japan, South Korea, and the Philippines by placing a stronger emphasis on new strategic partners including Vietnam.

“What some are calling our rebalance within the rebalance, which is an intensified focus on Southeast Asia, is now a central part of our policy,” Secretary Kerry said on Monday. “Nowhere is this more important or more visible, frankly, than in the heightened investment and engagement right here in Vietnam.”

While the U.S. executes its Asia Pivot strategy, Vietnam may find a new friend in an old foe as it considers the United States as a crucial market for its agricultural and apparel exports and, perhaps most importantly, as a diplomatic balance to rising China.

The United States is Vietnam’s second-largest trading partner after China, and bilateral trade relations between the two countries, now valued at nearly US$25 billion per year, clearly demonstrate the strides that have been made in the nearly two decades since normalizing relations.

As Deputy Prime Minister and Foreign Minister Pham Binh Minh noted, the two countries have “recorded a remarkable increase in bilateral trade turnover, with the United States being seventh among foreign investors in Vietnam with over 10 billion U.S. dollars in investment capital.”

According to the American Chamber of Commerce in Vietnam, bilateral trade is well on its way to rise 15.3% this year. Moreover, Vietnamese exports to the U.S. are predicted to rise 16.7% this year to US$23.7 billion, while its imports from the U.S. will most likely rise 8.7% to US$5 billion, as reported by the chamber.

To boot, Vietnam has been included in the negotiations for the Trans-Pacific Partnership (TPP), which Secretary Kerry described as a landmark in boosting Vietnam-U.S. economic, trade and investment relations.

The free-trade agreement could potentially boost trade among a dozen or more countries that account for more than 40% of the global economy. Perhaps the biggest benefit for Vietnam will come from the U.S. and Japan opening up their garment, footwear, seafood and pharmaceutical markets, thereby allowing Vietnam to secure greatly lowered tariff rates.

In his talks with Deputy Prime Minister and Foreign Minister Minh, Secretary Kerry affirmed the US Government’s desire to further strengthen all-around cooperation with Vietnam and implement the bilateral comprehensive partnership.

Prime Minister Nguyen Tan Dung applauded Kerry’s visit as a contribution to fostering bilateral relations.

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