Positive outlook for 2024 exports

Import and export activities have been bustling since the early days of 2024, forecasting a year of recovery and growth - photo: tapchicongthuong.vn

Increased exports

According to the Ministry of Industry and Trade (MoIT), the country’s Q1 foreign trade value reached an estimated US$178.04 billion (15.5 percent higher than the same period last year), including a trade surplus of US$8.08 billion.

This includes exports worth US$93.06 billion (up 17 percent percent) and imports worth US$84.98 billion (up 13.9 percent). Wholly domestic enterprises saw an export growth of 26.2 percent, almost double that (13.9-percent increase) of foreign-invested enterprises, including crude oil.

Sixteen exports yielded more than US$1 billion each (accounting for 82.1 percent of the country’s total), two items more than Q1 of 2023. Exports to most major markets increased, with those to the US reaching an estimated US$26.06 billion (accounting for 28 percent of the total and up 25.5 percent from Q1 in 2023), sales to China hitting US$12.68 billion (up 5.2 percent), those to the EU US$12.1 billion (up 16.3 percent), the Republic of Korea (RoK) US$6.6 billion (up 12.9 percent), and Japan US$5.7 billion (up 6.4 percent).

Tran Thanh Hai, Deputy Head of the Ministry of Industry and Trade’s Agency of Foreign Trade, attributed the export achievements to the positive signals in foreign markets, including the signs of interest rate cut by FED, and the EU market’s overcoming of the recession and recovering import demand. Other support factors include the Government’s business promotion policies, including tax reductions, administrative reforms, and the country’s signing and implementation of 16 free trade agreements (FTAs).

Challenges

Than Duc Viet, CEO of Garment 10 Corporation, said it is necessary to speed up production in order to compensate for the extended transportation time caused by tensions in the Red Sea.

Tran Ngoc Liem, Director of Vietnam Chamber of Industry and Trade (VCCI) in Ho Chi Minh City, said there remain risks associated with supply chains and transportation costs, and finding new partners, new markets and developing new sources of raw materials for the textile and garment industry has become an urgent need.

Nguyen Bich Lam, former General Director of the General Statistics Office of Vietnam (GSO), said the US$8.08-billion trade surplus in Q1 was totally made by foreign-invested enterprises, and domestic businesses made a trade deficit of almost US$4.5 billion. The Q1 trade surplus was due to the good fruit, vegetable and rice exports since the fourth quarter of 2023, as well as textile-garment and leather-footwear enterprises that have had export orders until the end of June. However, these advantages are difficult to maintain throughout 2024, Lam said.

An export-based growth strategy is important in the context of globalization and supply chain restructuring. Lam recommended that the Government urgently improve the legal framework on foreign trade, and adopt fiscal and monetary policies supporting businesses to increase supply sources, reduce costs and improve competitiveness.

He proposed that the Ministry of Industry and Trade further enhance market information, help businesses efficiently leverage FTA opportunities to boost exports, strengthen the promotion of rules of origin and issuance of Certificates of Origin, and improve the image of Vietnamese businesses as reputable exporters.

Tran Thanh Hai of the Agency of Foreign Trade said his Ministry of Industry and Trade has put forward various measures, including efforts to further expand FTA negotiations; urge businesses to learn about and further make advantage of FTA opportunities; innovate trade promotion with a focus on digitization; review legal documents; and simplify business procedures.n