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Vietnam lawmakers discuss ways to lessen reliance on Chinese economy

Vietnamese National Assembly (NA) deputies on Monday debated measures to reduce Vietnam’s dependence on the Chinese economy – the world’s second largest – in the context that China has illegally placed its oil rig in Vietnamese waters since May 1.

Vietnamese National Assembly (NA) deputies on Monday debated measures to reduce Vietnam’s dependence on the Chinese economy – the world’s second largest – in the context that China has illegally placed its oil rig in Vietnamese waters since May 1.
Vietnamese National Assembly (NA) deputies on Monday debated measures to reduce Vietnam’s dependence on the Chinese economy – the world’s second largest – in the context that China has illegally placed its oil rig in Vietnamese waters since May 1.

Huynh Ngoc Dang, an NA deputy from southern Binh Duong Province, said that Vietnamese ancestors’ experience showed that economic dependence on a country with which Vietnam has territorial disputes will become a fatal weakness.

“This is a great lesson, but many of us have paid inadequate attention to it,” Dang said.

In the current economic globalization era, two different economies can cooperate with each other on the basis of a win-win policy, which means mutual benefits for both, he said.

But there will be an extreme danger if one of the two sides is economically dependent on the other, the deputy added.

Meanwhile, according to official statistics, Vietnam’s economy is much reliant on China for many kinds of materials and supplies for production, and for outlets of Vietnamese farm produce.

Regarding this issue, Minister of Industry and Trade Vu Huy Hoang said Vietnam has trade relations with 180 countries in the world, of which the EU, U.S., Japan, ASEAN, and China are its key partners.

Last year, the value of goods exported from Vietnam to China accounted for nine percent of the former’s total export turnover of US$10 billion.

Meanwhile, Vietnam’s imports from China in 2013 made up as much as 23 percent of the Southeast Asian country’s total import value of over $30 billion, Minister Hoang said.

Such a trade deficit with China has existed for many years and has become a concern for many economic sectors in Vietnam, he pointed out.

Therefore, the Vietnamese government has asked the ministry to take measures to cut the trade deficit with China, the minister said.

Last year, Vietnam signed three agreements with China according to which Beijing is to increase the volume of farm produce imported from Vietnam and cooperate with Hanoi in rice export, he added.

At a monthly press conference held by the ministry on June 2, Deputy Minister of Industry and Trade Do Thang Hai also recognized that Vietnam is suffering a trade deficit with China, although the Southeast Asian country yearly exports large volumes of its 5-6 key commodities to China, including seafood, cashew nuts, and rubber.

Vietnam is relying on materials imported from China for producing many goods to be exported to other markets such as the U.S., EU, and Japan.

These materials include textiles and garment, leather and shoe products, and feed for aquaculture, Hai said.

In order to reduce the trade deficit with China, the ministry is adopting many solutions including boosting exports and strengthening production materials that can be used to replace imports.

Many industries have showed signs of less dependence on materials imported from China, Hai said.

For example, the Vietnam Textiles and Garment Association has called on businesses to import certain materials from many other potential markets, including Thailand, Indonesia, South Korea, India, and Malaysia.

The ministry also proposed that the Prime Minister issue a decision to give more support to develop local support industries in order to lessen dependence on Chinese suppliers, the deputy minister said.

On the other hand, Vietnam is also proceeding with negotiations on free trade agreements with many other countries, like South Korea, Hai said, adding that the country is trying to conclude the Trans-Pacific Partnership agreement as well as a separate deal with the Customs Union of Belarus, Kazakhstan, and Russia.

These agreements will help expand Vietnam’s export markets, reducing the dependence on exporting to China, he said.

At the conference, the deputy minister also said the trade relation between Vietnam and China remains normal despite Beijing’s unlawful placement of oil rig Haiyang Shiyou 981 in Vietnamese waters.