Vietnam's Furniture Sector 'Nervous' over U.S. Logging Probe

Vietnam's growing dominance as a furniture exporter is at risk as trade authorities in the U.S., its biggest market, probe the country's timber industry and its ties to illegal logging abroad, Nikkei Asia reported. The sector has boomed in recent years, thanks in part to former U.S. President Donald Trump's trade war with China, which saw tariffs as high as 25% slapped on Chinese furniture exports. Vietnam, in fact, overtook China last year in furniture exports to the U.S., shipping $7.4 billion worth of the goods, compared with China's $7.3 billion, reported Vietnam News Agency. Hanoi wants to further boost wood product exports from $13 billion overall in 2020 to $20 billion by 2025, Deputy Minister of Agriculture and Rural Development Ha Cong Tuan told local media in April. But the aggressive trade policy of the previous U.S. administration could curtail those ambitions. Under Trump, the Office of the U.S. Trade Representative in October launched two investigations under Section 301 of the Trade Act into Vietnam -- one into currency manipulation, and another into the country's timber sector. The latter is focused on whether Vietnam imports illegally harvested or endangered timber in violation of its own laws, those of the origin country and CITES regulations, which limit trade in protected species. Phuc Xuan To, a senior policy analyst at Forest Trends, told Nikkei Asia that people within the sector were "very nervous" about potential U.S. tariffs, given that Vietnam shipped about 60% of its wood product exports to America. "The U.S. government's impact on the Vietnam timber market could be substantial," he said. Read more.