Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.Global political risks and the opportunities, challenges for Vietnam’s economy.
MINISTRY OF EDUCATION AND TRAINING FOREIGN TRADE UNIVERSITY *** MASTER THESIS GLOBAL POLITICAL RISKS AND THE OPPORTUNITIES, CHALLENGES FOR VIETNAM’S ECONOMY Specialization: International Trade Policy and Law DUONG THI THU PHUONG Hanoi - 2023 MINISTRY OF EDUCATION AND TRAINING FOREIGN TRADE UNIVERSITY MASTER THESIS GLOBAL POLITICAL RISKS AND THE OPPORTUNITIES, CHALLENGES FOR VIETNAM’S ECONOMY Major: International Economics Specialization: International Trade Policy and Law Code: 8310106 Fullname: Duong Thi Thu Phuong Supervisor: Assoc.Prof.Dr Dao Ngoc Tien Hanoi - 2023 i STATEMENT OF ORIGINAL AUTHORSHIP I certify that I am the only author of this master’s thesis and that all information and findings presented herein are accurate In addition, I guarantee that all references to implementation aids in the master’s thesis have appropriately identified their origins Hanoi, 08 September 2023 Author Duong Thi Thu Phuong ii ACKNOWLEDGEMENT First and foremost, I would like to express my deepest appreciation to my supervisor, Assoc.Prof.Dr Dao Ngoc Tien for his unwavering encouragement and insightful guidance during the writing of my master’s thesis During the past five months, I could complete my thesis excellently thanks to his fascinating guidance and suggestions In addition to my advisor, I want to express my gratitude to all of the professors, lecturers as well as assistants at Foreign Trade University, particularly those in the Master Program of International Trade Policy and Law (MITPL), who invested so much of themselves in teaching us The knowledge I have gained through this process will not only help me finish my thesis, but will also give me the self-assurance I need to further my profession in the real world I also want to give a shout out to the people closest to me - my family, friends, and classmates - for all the love and support they showed me while I wrote one of the most significant pieces of my life Author Duong Thi Thu Phuong iii TABLE OF CONTENTS STATEMENT OF ORIGINAL AUTHORSHIP i ACKNOWLEDGEMENT ii LISTS OF ABBREVIATIONS .v LIST OF FIGURES vi LIST OF TABLES vii ABSTRACT viii INTRODUCTION 1 The significance of thesis Literature review .2 Research purpose and research questions Scope of the research .5 Research methodology 6 Structure of the thesis CHAPTER 1: THEORETICAL ISSUES AND CURRENT GLOBAL POLITICAL RISKS 1.1 Some theoretical issues 1.1.1 Definition of risk 1.1.2 Overview of political risk .9 1.2 The current global political risks 16 1.2.1 The Russia-Ukraine conflict 17 1.2.2 The US-China relation’s tension 25 CHAPTER 2: THE INFLUENCE OF GLOBAL POLITICAL RISK ON THE WORLD AND VIETNAM’S ECONOMY 34 2.1 The influence of the current global political issues on the world economy 34 2.1.1 The influence of the Russia-Ukraine conflict on the world economy .34 2.1.2 The influence of the US-China trade war on the world economy 39 2.2 The influence of the current global political issues in Vietnam’s economy 44 2.2.1 The influence of the Russia-Ukraine conflict in Vietnam’s economy 44 2.2.2 The influence of the US-China trade war in Vietnam’s economy 51 2.3 General review 56 iv CHAPTER 3: THE OPPORTUNITIES, CHALLENGES AND RECOMMENDATIONS FOR VIETNAM’S ECONOMY 58 3.1 The Vietnam’s Foreign policy and political risk index 58 3.2 The opportunities for Vietnam’s economy in the global political risks .61 3.2.1 The opportunities for Vietnam’s trade sector 61 3.2.2 The opportunities for Vietnam’s investment sector 64 3.3 The challenges for Vietnam’s economy in the global political risks 66 3.3.1 The challenges for Vietnam’s trade sector 66 3.3.2 The challenges for Vietnam’s investment sector 68 3.4 Recommendations for Vietnam’s economy in the context of global political risks 69 3.4.1 Recommendations for Vietnamese government 70 3.4.2 Recommendations for Vietnamese enterprises 72 CONCLUSION 74 SCIENTIFIC RESEARCH ix REFERENCES x v LISTS OF ABBREVIATIONS AI CPI DPR and LPR EU ICRG IMF MNEs NATO OECD Artificial Intelligence Consumer Price Index Donetsk People’s Republic Luhansk People’s Republic SWIFT The European Union International Country Risk Guide International Monetary Fund Multinational Enterprises The North Atlantic Treaty Organization Organization for Economic Co-operation and Development Society for Worldwide Interbank Financial UK US FDI Telecommunications The United Kingdom The United States Foreign Direct Investment vi LIST OF FIGURES Figure 2.1: Gas consumption in the EU 35 Figure 2.2: The EU’s diversification away from Russian gas 36 Figure 2.3: Commodity prices have diverged recently 37 Figure2.4: The inflation in the world from 2021, projections for 2025 38 Figure 2.5: Global growth has lost momentum 41 Figure 2.6: Global trade growth has slowed 42 Figure 2.7: Weaker investment has contributed to the trade slowdown 43 Figure 2.8: Moderate headline inflation is expected to persist in many advanced and emerging-market economies 43 Figure 2.9: Export - Import turnover between Vietnam and Russia from 2019 to 2022 45 Figure 2.10: Export - Import turnover between Vietnam and Russia in months of 2022 46 Figure 2.11: Export - Import turnover between Vietnam and Ukraine from 2019 to 2022 47 Figure 2.12: Export - Import turnover between Vietnam and Ukraine in months of 2022 48 Figure 2.13: The US general imports from Vietnam, by major industry or commodity sectors, 2015-19 (million dollars) .51 Figure 2.14: The US total exports to Vietnam, by major industry/commodity sectors, 2015-19 (million dollars) 52 Figure 2.15: Vietnam’s import and export with China (Unit: Million USD) 54 vii LIST OF TABLES Table 2.1: Global growth is projected to slow further 34 Table 2.2: Global growth remains weak 40 Table 2.3: U.S general imports from Vietnam by industry/commodity sectors, 2015-19 (million dollars) .51 Table 2.4: U.S total exports to Vietnam by industry/commodity sectors, 2015-19 (million dollars) .53 Table 3.1: EU open-door commitments for Vietnam’s agricultural commodity groups 62 viii ABSTRACT Nowadays, tension between great powers is increasing, leading to the unpredictable change of policy to the rest of the world Therefore, global political risk is one of the most serious risks which has a significant influence on a country’s economy, causing instable business environment for enterprises Especially, for Vietnam, it is a small country, relatively dependent on the big countries’ economy due to the regionally and globally deep integration The Master thesis with topic “Global political risks and the opportunities, challenges for Vietnam’s economy” concentrates on analyzing the two biggest global political risks which are the Russia-Ukraine conflict and the US-China relation’s tension because the events are happening and these countries have close relations with Vietnam in many different aspects such as: military, politics, especially economics The Russia-Ukraine conflict has happened more than one year since 2022, causing serious consequences to the world’s economy including: the decrease of the global growth, higher inflation, energy crisis and supply chain disruption The USChina relation’s tension has significantly escalated from the US president Donald Trump imposed a high tax on Chinese export products, leading to the trade war between two countries Similarly, the trade war caused some impacts on global economy, especially for trade and investment All both risks have direct and indirect influence on Vietnam’s economy in some main sector such as: trade, foreign investment, supply chain disruption When the Russia-Ukraine happened, declining trade turnover as well as investment’s stagnation between Vietnam and two countries due to payment, shipping difficulties Whereas, for the US-China trade war, Vietnam can get some benefits in a short time such as: increasing trade to both countries, attracting more foreign investment In general, Vietnam’s economy can not only get the good opportunities but also face some challenges from the global political risks Therefore, from the analysis, the author also gives some recommendations for both Vietnam’s government and enterprises to seize the chances as well as overcome the difficulties Key word: Global political risk, Russia-Ukraine conflict, the US-China trade war, Vietnam’s economy