With the gradual southward migration of the "World Factory" in the Asian plate, Southeast Asia accounts for an increasing proportion of the world's manufacturing. However, Southeast Asia has been shrouded in the haze of the epidemic recently, and the bright prospects before it have dimmed again, but Vietnam has recently The subtle changes in relations with the United States have brought Southeast Asia back into the sight of capital.
The story of the U.S.-Vietnam trade war
Time needs to go back to October 2020. USTR (Office of the United States Trade Representative) announced the launch of the “301 Investigation” on Vietnam’s timber and currency exchange rate related policies, which mainly included investigations into Vietnam’s import or use of “illegal logging or illegal trade” and timber Relevant behaviors, policies, and practices, as well as behaviors, policies, and practices that may cause the devaluation of the Vietnamese currency and cause damage to American businesses.
These investigations were conducted in accordance with Article 301 of the US Trade Act of 1974, so they are called "301 Investigations." This measure was once escalated into the economic and trade friction between the United States and Vietnam, which directly led to the imposition of punitive tariffs on products imported by the United States from Vietnam. At the same time, the investigation only involved its 301 investigation on Vietnamese currency practices, and it did not affect the illegal use of Vietnam. A separate 301 investigation of harvested or traded timber, which may result in tariffs on furniture and other wood products imported from Vietnam.
In late July 2021, following consecutive months of pressure on Vietnam by the United States over currency practices and the ever-increasing trade surplus, the State Bank of Vietnam and the U.S. Treasury Department reached an agreement not to allow the Vietnamese dong to be exported from “competitive devaluation” Advantages and make its currency and exchange rate policies more transparent. Then, the Office of the United States Trade Representative announced that it has determined that there is no need to impose punitive tariffs on Vietnam.
On October 1, 2021, the spokesperson of the Office of the United States Trade Representative announced the signing of the "Agreement on Combating Illegal Timber Logging and Trade" with Vietnam to address the concerns of the United States in the Vietnam Timber 301 investigation. The agreement contains a number of commitments made by Vietnam on issues related to illegal timber, including a commitment to improve its timber legality assurance system; to exclude confiscated timber (that is, timber seized for violation of domestic or international laws) from the commercial supply chain In addition; regardless of the export destination, verify the legality of domestically harvested timber; cooperate with high-risk source countries to improve border customs enforcement and enforcement cooperation.
The Agreement on Combating Illegal Timber Logging and Trade will come into force 30 days after the date of signing. From the perspective of the content of the agreement, the agreement will help promote the sales of Vietnamese timber and wood products to the US market, encourage the development of domestic afforestation, and improve The competitiveness of Vietnam’s export enterprises and the creation of more employment opportunities.
The future situation of the timber market in Southeast Asian countries
In September 2021, Vietnam’s exports of timber and forest products amounted to US$821 million, a month-on-month decrease of 8.2%. The main reason is that due to the impact of the epidemic, the blockade policy has led to the stagnation of factory production capacity and the inability to deliver products from overseas merchants on time, resulting in a sharp decline in the month-on-month ratio.
However, from a macro market perspective, Vietnam’s timber and wood products exports to the U.S. reached 7.4 billion U.S. dollars in 2020, accounting for 57% of Vietnam’s total timber and wood product exports. The U.S. has become the largest and fastest-growing export market for Vietnam’s timber, even in Under the difficult circumstances brought about by the new crown pneumonia epidemic, in the first eight months of this year, Vietnam's timber and wood products gross household registration reached US$6.4 billion, an increase of 58.8% over the same period in 2020. The overall environment still maintains a good upward trend.
At the same time, Vietnam continues to become an attractive world manufacturing center, and its trade competitiveness has been effectively improved. In the foreign market, China, the United States, and many European countries have become the main customer countries of Vietnam. It can be seen that Vietnam is attracting foreign direct investment. This is very successful, and it can be foreseen that as Vietnam and the United States resolve the trade surplus issue, they will still be able to maintain the sustained and stable development of trade.
The four Southeast Asian countries, Indonesia, Malaysia, Thailand and Vietnam, as the world’s important timber production and processing regions, are constantly exploring their own business transformation and have certain development potential in the future. At the same time, it is not only Vietnam, but also Malaysia, Singapore and Vietnam. The ASEAN member states and eight other countries signed the "Comprehensive and Progressive Agreement on Trans-Pacific Partnership" in August 2020, and their trade volume has greatly increased.
It is foreseeable that as the trade model of Vietnam is favored by the Western market, other Southeast Asian countries are also following the pace to learn the direction of development. At present, Southeast Asia is still plagued by the epidemic. The recent indexes have not yet felt obvious signs of recovery. However, in the future As the direction of production and operation changes, the focus of production and processing will gradually shift to Southeast Asia to help the wood processing industry recover.