Devaluation in Chinese Yuan has posed a challenge not only for China, but Vietnam as well. Going by a recent statement of Ministry of Planning and Investment, Vietnam’s export to China, especially farm produce, may become more competitive in the coming months. China already holds an edge over its counterparts in the area of export. Vietnamese exporters, still unaffected, are expecting tough times ahead. Textile and garment exporters are expecting things to change for the worse by next year when the agreement some companies have with Chinese partners comes to an end.

Vietnamese exporters may enjoy benefits from the Vietnam-EU Free Trade Agreement (FTA) as the import tariff on Vietnam’s textile and garment products will be cut from 9 per cent to zero per cent after seven years.

Deputy chair of the Vietnam textile and Apparel Association, Dang Phoung Dung feels, the weak Yuan is not a good indication for markets in Vietnam. It will give a boost to Chinese imports in the country and will affect local enterprises negatively.