Sir, the war between the US - Israel and Iran is becoming tense. According to you, how will this situation affect the Vietnamese economy, especially export activities?
- Regarding the current tensions in the Middle East, the first and clearest impact is the energy story. This is an area that concentrates the world's largest oil supply. If the conflict escalates, oil prices are likely to increase sharply. Meanwhile, Vietnam's export structure mainly relies on the processing and manufacturing industry, which are industries that use a lot of energy and transportation costs. When oil prices increase, input costs increase accordingly. This increase can happen quickly and unpredictably. Businesses have not had time to renegotiate selling prices with partners, but costs have increased, causing profits to be eroded.
Second is the output market. Currently, the US and Europe are major export markets for Vietnam. If the conflict spreads, the global supply chain may be disrupted. Transportation and trade routes can all change. Even some import businesses may temporarily postpone orders even though they have signed them before due to concerns about risks. If the situation lasts, it is inevitable that exports will be affected.
So according to you, will Vietnam's exports in 2026 be strongly affected if tensions continue to escalate?
- If the conflict is only local and soon cools down, the impact will be mainly in the short term. When the situation stabilizes, global trade will gradually recover and Vietnam's exports will not be too greatly affected. However, if the conflict lasts and escalates, the impact will be very significant. The US is Vietnam's largest export market. The Middle East is the region that directly affects global oil supply.
When both input and output are under pressure, exports will certainly face difficulties. The level of impact is heavy or light depends on the adaptability of the enterprise. If the enterprise redirects the market in a timely manner and diversifies invoices, the impact will be reduced. But if it depends heavily on a few major markets, the risk will be higher.
Faced with the increasing risks from tensions in the Middle East, according to you, what solutions should Vietnam implement to proactively respond and minimize negative impacts on import and export activities?
- The most important thing for Vietnam is to maintain stability and neutrality, and continue to affirm the image of a friendly and safe country for investment and production. When the world is unstable, investors are increasingly looking for stable destinations.
The second is to control the exchange rate and capital flow well, it is necessary to flexibly manage monetary policy, maintain market sentiment and orient capital flows into the production sector.
The third is to continue to expand and deepen bilateral cooperation relations. In the context that many countries tend to prioritize bilateral negotiations over multilateral ones, Vietnam needs to flexibly strengthen economic and trade cooperation agreements to create more room for businesses.
What recommendations do you have for export businesses, especially businesses with markets in the Middle East?
- Businesses with markets in the Middle East need to be particularly cautious. Security, payment, and transportation risks can all arise. The most important principle is market diversification. The Middle East, despite the war, still has demand for essential goods. However, businesses should not increase dependence on this region, need to expand to stable markets and take advantage of the free trade agreements that Vietnam has signed.
In addition, businesses must improve production standards, meet requirements on environment, labor, carbon border adjustment mechanisms... In a general risk environment, businesses that manage well and adapt quickly will have the opportunity to rise.
Thank you for sharing!
