Vietnam Moves to Ease U.S. Tension With Trade, FX Monitoring

Mai Ngoc Chau and Nguyen Dieu Tu Uyen, Bloomberg News

Containers sit stacked at Tan Cang-Hiep Phuoc Port, operated by Saigon Newport Corp., in Ho Chi Minh City, Vietnam, on Thursday, June 27, 2019. Vietnam has benefited from a surge in exports and foreign investment as businesses look to scale back their China operations or relocate to avoid higher U.S. tariffs. , Bloomberg

(Bloomberg) -- Vietnam Prime Minister Nguyen Xuan Phuc ordered government officials to intensify their crackdown on fraudulently mislabeled products for exports and closely monitor U.S. reactions to the nation’s monetary policy to avoid drawing rebukes from the Trump administration.

Phuc directed Vietnamese officials to pay close attention to U.S. reactions to net purchases of foreign currencies as the nation continues to build reserves. He also told officials to maintain frequent communication with American counterparts to blunt negative reactions to monetary policy, according to a transcript of a teleconference on Thursday between Phuc and government leaders.

“Attention needs to be paid to U.S. comments on net buying of foreign currencies,” Phuc said. “It is essential to maintain regular communication with U.S. agencies so that they see the issue objectively and cautiously.”

Vietnam is coming under increasing scrutiny from President Donald Trump’s administration amid a surge in exports to the U.S. and growing evidence of Chinese and other manufacturers diverting their goods via the Southeast Asian nation to bypass higher tariffs. Trump described Vietnam last week as “almost the single-worst abuser of everybody” when asked if he wanted to impose tariffs on the nation.

To contact the reporters on this story: Mai Ngoc Chau in Ho Chi Minh City at cmai9@bloomberg.net;Nguyen Dieu Tu Uyen in Hanoi at uyen1@bloomberg.net

To contact the editors responsible for this story: John Boudreau at jboudreau3@bloomberg.net, Nasreen Seria