US and Vietnam agree to end investigation into timber trade

The US and Vietnam have reached an agreement that puts to bed the USTR investigation into Vietnamese timber exports that started last October

In October 2020, the US Trade Representative (USTR) launched an investigation on Vietnam's timber exports under Section 301 of the 1974 Trade Act. This week, US Trade Representative Katherine Tai has announced an agreement with Vietnam that addresses US concerns in the investigation.

The agreement establishes commitments to keep illegally harvested or trafficked timber out of the supply chain, as well as to safeguard the environment and natural resources. Ambassador Tai noted that the agreement provides a satisfactory resolution of the matter subject to investigation and that no trade action is warranted at this time.

“I commend Vietnam for its commitment to address our concerns regarding the importation and use of timber that is illegally harvested or traded,” said Ambassador Katherine Tai. “With this agreement, Vietnam will provide a model – both for the Indo-Pacific region and globally – for comprehensive enforcement against illegal timber. USTR looks forward to working with Vietnam to deepen collaboration and information exchange, including through a newly created Timber Working Group.”

Currently, the US is the largest market for Vietnamese wood products, accounting for an expected $6.5 billion in 2020, or about half of Vietnam's overall agricultural shipments to the US. Walmart Inc. and Ashley Furniture Industries Inc. are among the largest clients of Vietnamese wood-furniture manufacturers.

“Illegal timber in the supply chain damages the global environment and the natural resources on which we all depend, and is unfair to US workers and businesses who avoid such timber,” added Ambassador Tai. “USTR’s first use of Section 301 in this investigation shows the strength of using this tool to address concerns regarding environmental risks or the enforcement of environmental laws.”