The Office of the U.S. Trade Representative (USTR) said in an emailed statement on Friday (10-1-21) that the U.S. and Vietnam have reached an agreement over illegally harvested and traded timber that will see Vietnam avert punitive tariffs in the process. The accord “secures commitments that will help keep illegally harvested or traded timber out of the supply chain and protect the environment and natural resources,” and no trade action is warranted for now.
The USTR opened a so-called section 301 investigation into Vietnam’s wood industry in October last year (the same law that enabled the nation to levy billions of dollars of tariffs on Chinese imports). The U.S. is the biggest market for Vietnamese wood products, representing an estimated $6.5 billion in 2020 — about half of the nation’s total agricultural shipments to the U.S. in 2020, according to the nation’s agriculture ministry. Vietnamese wood-furniture makers’ customers include Walmart Inc. and Ashley Furniture Industries Inc.
In a statement, USTR Trade Representative Katherine Tai said, “With this agreement, Vietnam will provide a model — both for the Indo-Pacific region and globally — for comprehensive enforcement against illegal timber.”
The investigation is the first to use section 301 of the Trade Act address environmental concerns.
FEA compiles the Wood Markets News from various 3rd party sources to provide readers with the latest news impacting forest product markets. Opinions or views expressed in these articles do not necessarily represent those of FEA.
U.S., Vietnam Reach Timber Pact, Averting Punitive Tariffs