Vietnamese wood products temporarily free from US tariffs

There has been no punitive tariff on Vietnamese wood product export to the US after the US Trade Representative (USTR) has issued the report on the probes of “Vietnam’s currency and timber practices”.

Over the past time, the Ministry of Industry and Trade, the Ministry of Agriculture and Rural Development, the State Bank of Vietnam, the Vietnam Timber and Forest Product Association and especially the Government have been working relentlessly to tackle and explain the nature of the probes on Vietnam’s practices related to currency valuation and origin of timber to the US side.

These efforts are extremely important because if the US imposed punitive tariffs, thousands of Vietnamese businesses would fall into great difficulties due to the small size of Vietnam’s economy which is highly sensitive to any external factors.

Vietnam has some 5,400 wood processing enterprises and 340 woodcraft villages which employ about half a million direct workers and more than one million farming households planting forest and rubber.

On January 15, related to “currency devaluation”, the Office of the US Trade Representative released the results on investigation under the Section 301 of the Trade Act of 1974 into Vietnam’s practices related to currency valuation.

The report found that Vietnam’s acts, policies and practices related to currency valuation are unreasonable which are burdening or restricting US commerce. To come to this conclusion, the USTR had consulted the US Treasury Department on the issues related to money valuation and foreign exchange policy of Vietnam.

However in the final finding, US Trade Representative Robert E. Lighthizer said the US is not taking any specific actions in response to these findings at this time.

“Unfair acts, policies and practices that contribute to currency undervaluation harm US workers and businesses, and need to be addressed,” Lighthizer said in a statement. He hopes the two sides “can find a path for addressing our concerns”.

Thus, Vietnam will have more time to join the US side, especially the new administration of the next President Joe Biden, to exchange and clarify the problems between the two sides related to Vietnam’s currency policies and timber origin in the coming time to ensure the mutual benefits.