Costa Rica joins 72 others to recognize Vietnam as market economy

Costa Rica has become the 73rd country to recognize Vietnam’s market economy status, days after the U.S. administration’s denial to do so.

Costa Rican Minister of Foreign Trade Manuel Tovar Rivera handed over a diplomatic note affirming such recognition to the Vietnamese Ministry of Industry and Trade (MoIT) on Monday.

The recognition reflects the achievements that Vietnam has made in the process of integration into the world economy, said MoIT Minister Nguyen Hong Dien, adding that such a move will help further economic and trade relations between the two countries.

Costa Rica’s recognition is a “positive” development as Vietnam has requested a number of trade partners to acknowledge the Southeast Asian country’s market economy status, which will better protect Vietnamese exporters in antidumping and countervailing cases, the MoIT said in a statement.

Australia, Canada, the UK, Japan, South Korea, and New Zealand are among the major economies that have graduated Vietnam to a market economy.

Last Friday, the U.S. Department of Commerce decided to retain Vietnam as a non-market economy, a move that disappointed Vietnamese authorities, nearly one year after the two former war adversaries upgraded their relationship to a comprehensive strategic partnership, the highest tier in Vietnam’s diplomatic classification.

Costa Rica is a member of the World Trade Organization (WTO) and the Organization for Economic Cooperation and Development (OECD), which features the 38 most developed market economies globally.

Costa Rica’s legal regulations include investigating and applying trade defense measures. As of December 31, 2023, Costa Rica had initiated 12 antidumping investigations on imported goods from countries such as Brazil, Chile, Mexico, the U.S., Nicaragua, El Salvador, Venezuela, and Guatemala, the MoIT cited WTO statistics as saying.

At a meeting in Hanoi on Monday, the MoIT’s Trade Promotion Department and Costa Rica’s counterpart PROCOMER signed a memorandum of understanding in the presence of the two trade ministers.

Vietnam’s customs data shows that Vietnam-Costa Rica trade reached $169.5 million in 2023, down 8.5% from 2022, with Vietnam sending $124.4 million to and importing $45.2 million from the Central American market.

In H1/2024, bilateral trade jumped 18.1% year-on-year to $99.95 million, with Vietnamese exports rising 20.9% to $76.8 million.