China overtook the U.S. as the main export market for Vietnam last year, underscoring how the world’s No. 2 economy is growing its influence in the region.
The U.S. was the top buyer of Vietnam goods for 15 years until it was overtaken in 2017 by China, according to data from the International Monetary Fund. That shift persisted this year with Vietnam’s shipments to China jumping 33.5 percent in the first quarter from a year ago, compared with 20 percent to the U.S., according to Vietnam’s statistics agency.
Vietnam has relied on the U.S. to counterbalance its dependence on China, a dominant neighbor and geopolitical threat in the region. But with U.S. President Donald Trump turning more inward by adopting trade protectionist policies, China is filling the gap with more trade and investment in Southeast Asia.
“The center of trade for Asia has clearly shifted to China from the U.S.,” said Eugenia Victorino, an economist at Australia & New Zealand Banking Group in Singapore. “Trade protectionism isn’t helping and Asian nations will realize more and more that when it comes to trade, China now punches a heavier weight.”
Export Fight
Asian nations' exports to the world's two largest economies
Source: International Monetary Fund
China has displaced the U.S. over the past decade as the top export market for many Asian economies, including Japan, South Korea, Thailand, Indonesia, and the Philippines. India is one of the few countries in the region that still counts America as a bigger market for goods than China.
Vietnam’s exports to China surged more than 10 times to $50.6 billion in the 10 years through 2017, compared with a fourfold increase to the U.S. to $46.5 billion, according to...