A 12.5% tariff from the U.S. may not be enough to bring Vietnam’s economy to its knees, but it’s enough to dispel the fog of rosy growth reports. Because when exported goods are hit with higher tariffs, the question immediately arises: Is Vietnam truly creating value, or is it merely positioned at the end of the supply chain to perform the final stage of production?
For many years, the “low-cost manufacturing hub” model was seen as Vietnam’s ticket to the global stage. Foreign companies arrived, factories sprang up, and export figures soared. Those numbers looked very impressive. But if most of the value lies elsewhere, while Vietnam primarily handles processing and assembly, how is that economy any different from a hired hand boasting about their boss’s revenue?
When tariffs change, that “illusion of prosperity” is immediately put to the test. At that point, Vietnam can no longer rely indefinitely on the advantages of cheap labor, cheap land, or preferential policies to compete. Perhaps it is time for policymakers to answer a difficult question: Does Vietnam want to become an economy that truly creates value, or will it simply continue to serve as the world’s assembly line while taking pride in its export figures?
https://www.facebook.com/share/p/1Aqjxe3fnX/
