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Vietnam is the trade war winner that is losing

3 0 0
05.07.2019

In war, even the winners pay a price.

Vietnam's portrayal as a clear beneficiary of the US-China trade conflict was overdue for a reality check. President Donald Trump provided one, trash talking the country with the kind of language he once reserved for China and Mexico. Vietnam is "almost the single worst abuser of everybody," he declared to Fox Business Network last week. That's a turnabout from earlier in the year when Trump praised Vietnam and said it was a model North Korea would be well advised to follow.

Vietnam's turn in the sun has coincided with a slackening of global growth that's wounded manufacturing.Credit:AP

The Communist state has an industrial policy, cheap factory wages and a burgeoning trade surplus that resemble the China of years past, as I wrote here in May. In Vietnam's favour, it's small relative to China and has had amicable relations with America in recent years. Still, playing the trade-conflict game has costs as well as benefits.

Positioning yourself as a key part of the export chain leaves you vulnerable when global demand weakens. A rush to expand manufacturing can create internal tensions, such as the........

© Brisbane Times