The Birth of a New China: How the U.S. - China Trade War Affected the Economy and Foreign Policies of Vietnam in 2016 – 2020

Following the U.S. – China Trade War, Vietnam has been recognized as one of the biggest economic beneficiaries, showing significant economic increases from 2018 – 2020. However, the empirical causal extent of the Trade War’s impact on Vietnam’s economy has largely been ignored, as well as how Vietnam will craft its foreign policies regarding the U.S. – China conflict. Using the difference-in-difference regression approach, this paper attempts to verify the causal impact of the Trade War on Vietnam, focusing on the Vietnam – U.S. export and the Vietnam – China import datasets. The paper also explores Vietnam’s foreign policy strategy for the Trade War and the U.S. – China conflict by conducting traditional qualitative analysis on six qualitative interviews. This paper confirmed that the Trade War had a positive causal effect on Vietnam’s export to America at the country level and Vietnam’s import from China at the tariff level. However, it could not confirm whether the Trade War had such an effect on Vietnam’s import from China at the country level and Vietnam’s export to America at the tariff level. Along with quotes and anecdotes collected from policy experts, this paper suggested that Hanoi must maintain its political neutrality in international affairs while continuing to capitalize on Vietnam’s economic success and enhance its trade relationship with the U.S. and China.