Xeneta’s data reveals that Vietnam is rapidly emerging as a source of manufactured goods for the United States, effectively challenging China’s stronghold in the Trans-Pacific container trade. A variety of factors, including geopolitical tensions, reshoring, and changes in foreign investment flows, are reshaping global trade patterns.
Container imports from Asia to the U.S. have increased by 27% over the past five years. Of the 12 major economies in the region, China and Singapore have recorded the lowest export growth at 7%, while Hong Kong has seen no volume growth. In contrast, Vietnam has experienced an impressive 156% increase in container trade with the U.S. from 2017 to 2022.
This trend is also reflected in the share of imported volumes. While China still accounts for 56% of containerized imports from Asia into the U.S., it has seen a -10 percentage point decline from 2017. Meanwhile, Vietnam’s share has nearly doubled from 6% in 2017 to 11% in 2022.
Foreign investments in China have fallen 73% year-on-year to $42.5 billion, compared to an average of $160 billion each half-year between the second half of 2020 and the first half of 2022. Meanwhile, Vietnam’s foreign direct investments have grown 61.2% year-on-year in the first three months of 2023, including a 62.1% increase in new foreign-invested projects, with the processing and manufacturing sectors accounting for 75% of the total investment.
Despite a significant reduction in exports from China to the U.S. in March, China’s total exports have managed a year-on-year growth rate of 15% due to thriving trade with Russia and countries in South Asia. Emily Stausbøll, Xeneta’s market analyst, suggests that geopolitical factors rather than availability or price will increasingly shape trade and investment decisions in the future.
She warns that another major geopolitical event, such as escalating tensions around Taiwan, could again change the outlook for global trade.
Source: splash247.com