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Many Exports in Difficulty

According to the General Statistics Office of Vietnam (GSO), Vietnam was estimated to earn US$92.2 billion from exports in the first seven months of 2015, up nearly 10 percent over the same period of 2014. This growth rate was lower than that a year earlier when Vietnam ran a substantial trade surplus.

Growing pressures
Many exports continued to encounter a tough time, particularly agricultural and aquatic products like fruits, vegetables, cashew nuts, coffee, tea, pepper, rice, tapioca and rubber. The export value of agricultural, forest and aquatic products fell 7.4 percent year on year mainly because of a drop in shipments of seafood, rice, coffee and rubber
Specifically, seafood export turnover was estimated at US$3.6 billion, down about 15 percent year on year; rice shipments grossed 3.7 million tonnes worth US$1.6 billion, down 3.5 percent in volume and 8.7 percent in value (price dropped 5.4 percent); coffee exports were forecast at 800,000 tonnes valued US$1.65 billion, down 33.2 percent in volume and 33 percent in value; and rubber shipments totalled 531,000 tonnes worth US$779 million, up 16.3 percent in volume but down 6.9 percent in value (price slid 19.9 percent).
Crude oil export turnover fell almost by half from a year earlier to US$2.5 billion in the first seven months of this year.
The FDI sector continued to maintain a high growth rate and contributed largely to export growth. The export turnover of the country in the first seven months of 2015 increased by US$8 billion from a year-ago period and the FDI sector reported an addition of US$10.68 billion (excluding crude oil). The domestic sector witnessed a decrease of US$471 million and crude oil exports dropped US$2.19 billion.
Fast-growing, high-valued exports were made by FDI companies, including telephones and parts (FDI firms accounted for 99.7 percent of the country’s export turnover of these commodities); computer and electronic components (98.6 percent); footwear (79.3 percent), apparels (60.6 percent), and cameras (99 percent).
However, the picture of exports still had bright spots illustrated by information technology products, apparels and footwear. As Vietnam has been, and will be, joining many free trade agreements (FTAs), garment – textile and leather – footwear export valued soared 22 percent year on year to nearly US$20 billion in the first seven months, making up 22 percent of the nation’s total exports.
 201585101241 xuatkhaugao Many Exports in Difficulty   Bamboo, Rattan, Vietnam Handicraft
In the first seven months of 2015, shipments to the US rose 19.1 percent year on year and account for around 20.5 percent of Vietnam’s total exports. Shipments to the EU climbed 13.2 percent and contributed to 19.3 percent of Vietnam’s export earnings; exports to ASEAN fell 2.6 percent and made up 11.6 and percent; shipments to Japan sank 6.5 percent and accounted for 8.6 percent; and exports to China looked up 8.3 percent and accounted for 10.1 percent.
Trade deficit surges
Meanwhile, imports continued to surpass exports in the seven-month period, reaching US$95.6 billion, up 16 percent year on year. The FDI sector reported an increase of US$10.65 billion. The country ran a trade deficit of US$3.37 billion in the seven months, or 3.6 percent of total exports. In July, the trade deficit value was US$300 million, higher than US$140 million in June.
Major importers were FDI firms. Key items included telephones and accessories (FDI companies accounted for 87.8 percent of the country’s total imports of these commodities); computers, electronic products and components (92.3 percent); fabrics (61.9 percent); and materials for textile, garment and footwear production (69 percent).
As Vietnam is a major subcontractor for large foreign corporations which import inputs for production in the country. For instance, the import value of phones, electronics, computers and parts exceeded US$19 billion while the import value of machinery, equipment, tools and spare parts jumped 35 percent year on year to over US$16.5 billion.
Vietnam imported 65,000 automobiles worth US$1.7 billion in the seven months, more than doubling the value a year earlier.
Imports from Asia accounted for 81.8 percent of the country’s total spending. China was the biggest import market of Vietnam with some 30 percent of value, followed by ASEAN, South Korea and Japan.
In the remaining months of the year, Vietnam will focus unfreeze bottlenecks in import-export by reviewing and simplifying administrative procedures relating to import and streamlining procedures of certificate of origin granting. The Ministry of Industry and Trade will promote the sharing of market information (scale, price, trends, consumer tastes, distribution channels, regulatory requirements, etc) from Vietnam’s trade offices in foreign countries with exporters, especially exporters of agricultural and aquatic products.
The country will also intensify trade promotion, expand current markets and seek new ones, particularly countries with FTAs with Vietnam.


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