WASHINGTON – In testimony given today as part of a U.S. Section 301 Committee hearing on the U.S. Trade Representative’s (USTR) investigation into Vietnam’s Acts, Policies, and Practices Related to Currency Valuation, global tech trade association ITI cautioned USTR to avoid the imposition of tariffs, which would have significant negative effects on U.S. security and competitiveness, and instead urged an emphasis on bilateral engagement with Vietnam to resolve concerns.
“While we recognize there may be legitimate concerns regarding Vietnamese currency valuation, the application of tariffs on goods imported from Vietnam – and ICT goods and components in particular – would prove counterproductive to addressing underlying policy concerns and would have far-reaching negative commercial and strategic repercussions for the United States,” ITI wrote in its testimony.
ITI noted that given the diversification of the ICT supply chain out of China, companies have significantly increased reliance on Vietnam as a major source of suppliers. Imposing tariffs on products and components exported from Vietnam would pose immense challenges for the manufacture and export of critical ICT equipment and components, including semiconductors, microprocessors, 5G network equipment, and WIFI-enabling devices.
“These components and the stability of the supply chain are crucial to U.S. competitiveness with China as relates to advanced and emerging technology,” ITI wrote. “At a time when the Administration is seeking to encourage the deployment of trusted technology, imposing tariffs on these products would undermine that policy.”