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Non-Market Economy Status

Non-Market Economy Status:

Vietnam has been pushing the President United States of America to quickly change its “non-market economy” classification to “market economy” status.

  • The United States of America designates a country as non-market economy based on several factors namely
    • If the country’s currency is convertible;
    • If wage rates are determined by free bargaining between labour and management;
    • If joint ventures or other foreign investment are allowed; whether the means of production are owned by the state; and
    • If the state controls the allocation of resources and price and output decisions.
  • The non-market economy label allows the US to impose “anti-dumping” duties on goods imported from designated countries.

Market Economy: It is a system in which production decisions and the prices of goods and services are guided primarily by the interactions of consumers and businesses.