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Foreign Direct Investment Location and Trade Dynamics in Viet Nam After the US–PRC Trade Dispute

Author

Listed:
  • Elhan-Kayalar, Yesim

    (Asian Development Bank)

  • Kucheryavyy, Konstantin

    (CUNY Baruch College)

  • Nose, Manabu

    (International Monetary Fund)

  • Sawada, Yasuyuki

    (University of Tokyo)

  • Shangguan, Ruo

    (Jinan University)

  • Thanh Tung, Nguyen

    (National Economics University)

Abstract

In developing economies, foreign direct investment (FDI) plays a crucial role by providing resources that facilitate participation in international trade and support economic development. Focusing on Viet Nam as a case study, this research aims to quantify the distributional effects of the United States–People’s Republic of China trade dispute across different regions in Viet Nam. By utilizing detailed firm-level and customs data, we demonstrate that FDI in Viet Nam is geographically concentrated in the northern, central, and southern regions. Access to road and port networks significantly influences the choice of FDI locations. Furthermore, we highlight the important role that the foreign affiliates of multinational firms from East Asia and the United States have played in reshaping Viet Nam’s trade flows in the aftermath of the trade dispute between the United States and the People’s Republic of China. This study sheds light on the interplay between transport infrastructure, FDI, and international trade.

Suggested Citation

  • Elhan-Kayalar, Yesim & Kucheryavyy, Konstantin & Nose, Manabu & Sawada, Yasuyuki & Shangguan, Ruo & Thanh Tung, Nguyen, 2024. "Foreign Direct Investment Location and Trade Dynamics in Viet Nam After the US–PRC Trade Dispute," ADB Economics Working Paper Series 761, Asian Development Bank.
    • Handle: RePEc:ris:adbewp:0761
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    More about this item

    Keywords

    trade; ports; roads; US–PRC trade dispute; Viet Nam; PRC;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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