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1 1 (August 29, 2024)

handle is hein.crs/goveqmo0001 and id is 1 raw text is: Vietnam's Nonmarket Economy (NME) Status Updated August 29, 2024 Shortly after extending normal trade relations (NTR) status to Vietnam in 2001, the United States designated Vietnam as a nonmarket economy (NME) for the purposes of antidumping (AD) and countervailing duty (CVD) investigations. The government of Vietnam has long sought to remove the designation, arguing it may hinder closer bilateral ties. During President Joseph Biden's September 2023 visit to Hanoi, where he and then-Communist Party of Vietnam (CPV) Secretary-General Nguyen Phu Trong elevated the U.S.-Vietnam relationship to a comprehensive strategic partnership, Biden agreed to review Vietnam's request to review its NME status. The following month, the Department of Commerce initiated an official review. During the review period, some Members of Congress raised concens over whether Vietnam meets the conditions to be designated as a market economy. On August 2, 2024, Commerce announced its decision to sustain Vietnam's NME designation, citing the Vietnamese government's involvement in the economy, despite substantive reforms, as a factor for not lifting the designation. U.S.-Vietnam Relations Since 2010, the United States and Vietnam have forged a strategic partnership on many regional security and economic issues, prompted in part by shared concerns about China's increased assertiveness in the region, and by burgeoning economic links. Over the last decade, Vietnam has become a major manufacturing center and one of the United States' top ten trading partners. Top U.S. imports from Vietnam include consumer electronics, furniture, semiconductors and parts, apparel, and footwear. Vietnam is the second-largest source of U.S. apparel imports, after China. The September 2023 upgrade in relations was accompanied by several initiatives, including U.S. pledges to support Vietnam's development of its semiconductor industry (including with $2 million in U.S. government funds) and digital infrastructure ($12 million). Additionally, agreements under the U.S.-led, 14-country Indo-Pacific Economic Framework for Prosperity (IPEF) negotiations, which includes Vietnam, may further deepen U.S.-Vietnam economic ties. Under the doi moi (renovation) economic reforms that began in 1986, the Vietnamese government abandoned many aspects of central state planning, cut subsidies to state enterprises, reformed the price system, and opened the country to foreign direct investment (FDI). In a 2022 report, the Organisation for Economic Cooperation and Development (OECD) noted that the number of state-owned enterprises (SOEs) has decreased significantly, but SOEs still account for roughly 30% of the GDP. The U.S. government also actively monitors Vietnam's currency practices, which were subject to U.S. Congressional Research Service https://crsreports.congress.gov IN12326 CRS INSIGHT Prepared for Members and Committees of Congress

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