HANOI, Nov 2 - Vietnam’s garment exports are set to rise by 14.8 percent this year to $35 billion, an industry official said on Friday, as U.S. retailers diversify their product sourcing to keep costs under control amid an escalating trade dispute with China.

The U.S. has already imposed tariffs on $250 billion worth of Chinese goods, and China has responded with retaliatory duties on $110 billion worth of U.S. goods.

Garments, Vietnam’s second largest export-earner after smartphones, are not yet subject to U.S. tariffs, although some manufacturers have sought to move at least some production to the Southeast Asian country, anticipating potential penalties.

“We are seeing more and more orders coming in, especially from the United States,” Vu Duc Giang, chairman of Vietnam Textile & Apparel Association, told Reuters.

Garment exports to the United States rose 12 percent in the January-October period to $10.5 billion, while exports to China surged 40 percent to $1.1 billion, according to a government statement released on Thursday.

Ngo Quang Thoa, chairman of Swimax International Joint Stock Co, a contractor which produces swimwear and underwear products for U.S. companies such as Target and Express, said he had received a large increase in orders from the United States since January.

“This is because of the trade war between the U.S. and China,” said Thoa, who added that he expected to see his exports to the United States increase by up to 20 percent by the end of the year.