currencies

Vietnam rejects US currency manipulation charge

Agence France-Presse, Agence France-Presse
Vietnam rejects US currency manipulation charge

CURRENCY. A Vietnamese commercial bank's employee counts local banknotes, the dong, in Hanoi on December 19, 2011.

File photo by Hoang Dinh Nam/AFP

Vietnam denies allegations by the United States that it intervened in currency markets, adding it is not trying to create 'an unfair advantage in international trade'

Vietnam on Thursday, December 17, rejected United States accusations of currency manipulation, saying it was acting to keep its economy stable, not seeking an unfair competitive edge.

The US Treasury on Wednesday, December 16, accused the communist state of intervening in currency markets to weaken the dong, which the International Monetary Fund said was undervalued by some 8.4% in 2018.

The State Bank of Vietnam said its currency management policy aimed to “control inflation and stabilize the macroeconomy, not create an unfair advantage in international trade.”

“The State Bank’s recent intervention in buying foreign currencies is aimed at ensuring the smooth operation of the foreign currency market,” the central bank said in a statement.

Foreign ministry spokeswoman Le Thi Thu Hang said Vietnam attached “special importance” to trade ties with the US and was consulting Washington to address “outstanding issues.”

US officials reviewed 20 major trading partners with bilateral goods trade with the United States of at least $40 billion annually.

They accused Vietnam – as well as Switzerland – of interfering in foreign exchange markets to artificially weaken their currencies.

The Treasury report called on Vietnam to “reduce its currency intervention and allow for movement in the exchange rate.”

The findings in the report are largely symbolic and do not entail sanctions, instead triggering more consultations to try to address the dispute. – Rappler.com