Vietnam excluded from US Treasury's monitoring list

Vietnam is not one of the monitored economies for potential monetary manipulation, the State Bank of Vietnam (SBV) announced on November 11, citing a report from the US Department of Treasury.

Bill notes are counted. The US Department of Treasury has announced its monitoring list for potential monetary manipulation, which excludes Vietnam. Photo: The Hanoi Times

The report, published on November 10, aims to evaluate and conclude on macroeconomic and foreign exchange policies of major trading partners of the United States, including Vietnam.

The report assesses the possibility of monetary manipulation among major trading partners of the US on three criteria: a significant bilateral trade surplus with the US, a material current account surplus, and engagement in persistent one-sided intervention in the foreign exchange market.

In the report, the US agency concluded that “no major US trading partner manipulated the exchange rate between its currency and the US dollar to prevent effective balance of payments adjustments or gain unfair competitive advantage in international trade during the four quarters through June 2022.”

Vietnam is among five economies removed from the monitoring list for “having met only one out of three criteria for two consecutive reports.”

In two consecutive reports, Vietnam has met only the criteria regarding a significant bilateral trade surplus with the US, which exceeded the maximum level of US$15 billion to reach $105 billion.

Since the beginning of 2021, the US Department of Treasury has commenced its bilateral evaluation with Vietnam. The two sides reached an agreement in July 2021 to resolve the concerns of the US on monetary and forex rate issues.

At the July meeting, US Secretary of the Treasury Janet L.Yellen appreciated the efforts of the State Bank of Vietnam to maintain a proper management policy on monetary and foreign currency exchange amid adversities of the global economy.

The report also included seven economies in the monitoring list: China, Japan, South Korea, Germany, Malaysia, Singapore, and Taiwan. These seven economies merit close attention to their currency practices and macroeconomic policies.

The report also found that “Switzerland meets all three criteria under the Trade Facilitation and Trade Enforcement Act of 2015 (the 2015 Act) over the four quarters through June 2022.”

Therefore, the US Department of Treasury will continue “enhanced analysis of Switzerland’s macroeconomic and exchange rate policies” and “discuss the Swiss authorities’ policy options to address the underlying causes of its external imbalances.”