US buys Chinese Christmas lights "made in Vietnam"

The U.S usually imports Christmas lights and decorations from China, but this year witness a different picture. It has been "manufactured" in Vietnam.
According to Bloomberg, for many years, China has been a manufacturer, providing mainly Christmas lights and decorations for the US market.

But the US-China trade war has caused American importers to change direction. The reason is that the US imposes tariffs on Chinese goods, resulting in a sharp increase in many items here.

In that context, the US came to Vietnam.

Shipments of Christmas lights and decorations imported from Vietnam to the US doubled in the first 10 months of the year compared to the same period in 2018. Meanwhile, in the same period, imports of lamps from China's China has dropped by 49%.

But the story behind this is much more complicated.

Christmas lights are just one of a number of goods that are in the erratic up and downtrend of the list of Chinese goods that are taxed by the US.

Chinese manufacturers have sought to avoid putting "Made in China" labels on their goods to avoid taxation.

They take the goods across the 'neighbors' border like Vietnam and re-affix the labels, for example, "Made in Vietnam," and then export to the US.

Vietnam is, without a doubt, attracting many foreign investors and producers, before US President Donald Trump rocked the global supply chain.

However, the trade war has increased the risk of illegal goods trade, pushing Vietnam into a 'hot seat'.

Nguyen Thi Ha, a Christmas seller on Hang Ma Street, Hanoi, told Bloomberg that some local companies have imported materials and parts from China to Vietnam and then assembled them into Christmas light.

In May, President Trump imposed another 25% tariff on Chinese Christmas lights, up from 10% previously. This item was not on the list of the first phase trade agreement between the US and China earlier this month.

The representative of the Vietnam General Department of Customs, Mr. Au Anh Tuan, told Bloomberg that controlling the illegal goods flow is a current obstacle for Vietnam.

Recently, the country's Customs has detected 14 cases of exporting goods with fake labels.

Meanwhile, data through November shows that direct investment from China into Vietnam in 2019 has increased by three digits.

Foreign direct investment into Vietnam (FDI) is on track to reach $ 35 billion this year, equivalent to two years ago.

But success also comes with the cost.

Vietnam's merchandise surplus with the United States increased to $ 46.3 billion in the first 10 months of 2019 - an increase of 39% over the same period last year - making Vietnam a target for the White House.

Mr. Trump used to point out that Vietnam is a commercial abuser.

Soon after that, Vietnam bought a large volume of liquefied gas from the US to help reduce the trade surplus.

Recently, the US has imposed more than 400% tariff on anti-corrosion steel and cold rolled steel imported in Vietnam using substrate steel originating from Korea and Taiwan.

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