July 14, 2020 13:27

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Vietnam will have a surplus for 4th year running

13:50 | 17/11/2019

VCN- Although the export growth rate in the first 10 months of this year was less than half compared to the same period in 2017 and 2018, Vietnam had a trade surplus of over US$7 billion. It is forecast that 2019 will be the fourth consecutive year with an export surplus of Vietnamese goods.

tin nhap 20191112163900 Import-export turnover reaches 427 billion USD
tin nhap 20191112163900 Trade deficit reaches nearly 400 million USD in first half of October
tin nhap 20191112163900 Vietnam enjoys growing trade surplus of over US$6.8 billion
tin nhap 20191112163900
In the first 10 months, the proportion of the domestic economic sector continued on anupward trend, accounting for 30.7 percent of total export turnover. Photo: N. Thanh

Prospects of domestic enterprises

According to the latest report by the Ministry of Industry and Trade, by the end of October, the total import and export turnover of goods was estimated at US$427.05 billion, up 7.6 percent over the same period in 2018. In particular, the export turnover was estimated to reach US$217.05 billion, up 7.4 percent; import turnover is estimated at US$210 billion, up 7.8 percent. In the past 10 months, the United States continued to be the largest export market of Vietnam with a turnover of US$49.9 billion, up 26.6 percent over the same period last year; followed by the EU, China and ASEAN markets.

Regarding exporting goods sincethe beginning of the year, the most noticeable point is the clear change in domestic enterprises compared to foreign invested enterprises (FDI). This is shown by the figures, such as the growth rate of 10-month export turnover of the domestic economic sector reaching 16.2 percent, much higher than the growth rate of the foreign-invested sector (3, 9 percent). Thereby, the proportion of the domestic economic sector continued to increase, accounting for 30.7 percent of total export turnover (the same period last year was 28.4 percent). Thus, after achieving a relatively high growth rate in 2018 (14.96 percent), the domestic enterprises continued to be a bright spot in Vietnam's export activities in the first 10 months.

In general, over the past 10 months, the Ministry of Industry and Trade said that the growth rate of 7.4 percent was somewhat slower than the same period in 2018 and 2017 (increasing by 15.3 percent and 21.8 percent, respectively). The result basically followed the set goal of the National Assembly to bring export growth to increase by 7-8 percent in 2019. Up to the present, the country's export turnover of goods has completed 82.5 percent of the target for the whole year. This shows no small effort in exploiting the market, promoting exports and a positive trend in the context of declining global trade.

"The trade balance of goods in 10 months was estimated at a trade surplus of US$7.05 billion, higher than the US$6.83 billion of the whole of 2018. With this development, it is likely that 2019 will be the fourth consecutive year with a trade surplus. Vietnam's economy is shifting from trade deficit to trade surplus in recent years,"said the Ministry of Industry and Trade.

Exports have little fluctuation in the last 2 months of the year

The last two months are close in 2019, although the import and export turnover is usually quite high compared to the beginning of the year because this is the time to prepare goods for the largest shopping occasions.The Ministry of Industry and Trade says that export activities will not have many changes due to the impact of the global economic downturn.

Exports have a number of favorable factors. Specifically, the export of textiles, wood and wooden products, agriculture, and fisheries are often at a high level at the end of the year due to the increasing demand for goods for holidays. In addition, pangasius export to the US market is expected to recover in the near future,according to the preliminary decision of the 15th anti-dumping tax review on Vietnamese pangasius products.The US Department of Commerce (DOC) has announced preliminary tax rates for mandatory and voluntary defendants of US $ 0 / kg; the national tax rate is 2.39 USD / kg. This tax is much lower than the final result of the previous review at 1.37 - 2.39 USD / kg. This is a good signal for pangasius exports to the US market.

However, the Ministry of Industry and Trade also said that many factors hindered export growth. The exports of all kinds of phones, after a sharp increase in the third quarter of 2019 (due to Samsung launching new products), will slow in the fourth quarter of 2019. Exporting goods to China is still facingmany difficulties due to Chinese economic growth slowing down and the impact from trade tensions between the US and China.

"China's economic growth in the third quarter of 2019 was lower than expected, only 6 percent compared to the same period last year. This is also the weakest growth in nearly three decades of this country. From the less vibrant production situation in the context of strong influence from the US-China trade war as well as the decline in domestic consumer demand, not only did the demand drop, the export of Vietnam's agricultural and aquatic products to the Chinese market also faced many difficulties due to its increased inspection and quality control of imported goods before customs clearance,"said the Ministry of Industry and Trade.

From now until the end of the year, the Ministry of Industry and Trade determined to continue closely monitoring the fluctuations of the world situation, especially the development of the US-China trade war to take the initiative in administration and take measures to promote export goods that are able to take advantage of opportunities to export and strengthen strict management against the risk of trade fraud and origin fraud; strengthening research, forecasting and warning measures for trade remedies applied to Vietnam's export goods.

Focus on anti-origin fraud

Regarding origin fraud, especially goods from China and other countries that use Vietnam's origin to take advantage of tariff preferences;answering questions from National Assembly deputies at the 8th meeting, National Assembly XIV on 6/11, Minister of Industry and Trade Tran Tuan Anh emphasized: “The Ministry of Industry and Trade has a list of early warnings about the risk of commercial fraud in a number of items. For example, there are 25 export items to the US and other countries at risk of being taken advantage of, including items such as electronics, plywood, textiles, footwear. The Ministry of Industry and Trade has just issued a circular on suspension of temporary import as well as exporting plywood to the US. This is a commodity that has grown up to over 400 percent in recent years and poses a great risk of trade fraud, originating in the US.

"We are also continuing to coordinate with industry associations and organizations to recommend, provide sufficient and timely information to warn about the risks of trade sanctions as well as taxes.There are many products of other countries that are subject to taxes of the US, EU and many countries on anti-dumping and anti-subsidy taxes. They seek to take advantage of products of Vietnam export to these countries,"said Minister Tran Tuan Anh.

By Thanh Nguyen/Bui Diep