U.S. suggests Vietnam’s currency steps ‘unreasonable’ but retains off on tariffs

WASHINGTON (Reuters) – President Donald Trump’s administration reported on Friday Vietnam’s steps to drive down the price of its forex are “unreasonable” and restrict U.S. commerce, but did not acquire speedy action to impose punitive tariffs.

Releasing the results of its so-identified as Section 301 investigation into Vietnam’s currency techniques, the U.S. Trade Representative’s (USTR) business office said it would continue to consider all available solutions to appropriate the situation. That procedure will pass to the administration of Democratic President-elect Joe Biden, who is owing to acquire place of work on Wednesday.

The U.S. Treasury Office in December labeled Vietnam a “currency manipulator” owing to its expanding trade surplus with the United States, its significant global latest account surplus and major foreign exchange sector intervention to maintain down the benefit of its dong forex.

Small business teams and trade authorities experienced feared this would lead to tariffs in the USTR investigation opened last Oct as a parting shot from the Republican Trump, who aggressively imposed tariffs during his four several years in office.

The USTR said it consulted the Treasury Department on Vietnam’s exchange-fee insurance policies.

“Unfair functions, insurance policies and techniques that add to currency undervaluation hurt U.S. personnel and organizations, and need to have to be addressed,” U.S. Trade Representative Robert Lighthizer mentioned in a assertion. “I hope that the United States and Vietnam can come across a path for addressing our problems.”

Vietnamese government stated on Saturday it welcomed the choice of the USTR, describing it as “a positive result” of the attempts of the federal government and corporations from the two Vietnam and the U.S.

“Vietnam will continue its attempts to open up its market and enrich policy dialogues and strictly adhere to agreements involving the two sides…to maintain a steady trade relation with a concentrate on for a balanced, sustainable and mutually-helpful trade,” the federal government mentioned in a statement.

The Segment 301 investigation – named right after a provision in a U.S. trade law – was the exact software that Lighthizer made use of to launch a sweeping tariff war from China, which has left punitive U.S. tariffs on $370 billion well worth of yearly Chinese imports and prompted quite a few providers to change supply chains out of China. Vietnam has been a big beneficiary of expense from these organizations in search of to stay away from U.S. tariffs on China.

The USTR’s determination to hold off on ordering tariffs from Vietnamese products presents Biden’s nominee as trade consultant, Katherine Tai, some breathing area in deciding how to tactic Vietnam.

A spokesman for Biden’s changeover workforce declined to remark on the USTR final decision.

The Vietnamese federal government said its trade ministry and similar companies are willing to talk with the USTR to handle the remarkable issues in the trade relations involving the two nations around the world to officially close the investigation.