VIETNAM: US Cancels Currency Manipulator Designation

Vietnam has been removed from the list of nations designated as currency manipulators by the US. The change in status was confirmed in the latest edition of the Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States report, as published by the US Treasury on 16 April. Although now officially off the list, the report also highlighted the need for “enhanced engagement”, a practice that will ensure Vietnam’s currency practices remain subject to sustained scrutiny. 

Although, since being place on the list in December 2020, Vietnam has not had any sanctions imposed by the US, the possibility of trade tariffs or other penalties being actioned remained a constant possibility should no resolution be achieved. Such sanctions could have had serious consequences for the country, given that the US is its largest trading partner and the destination of some US$37.9 billion worth of Vietnamese exports in 2020.