Vietnam's trade surplus is still low and unsustainable

DNHN - The current trade surplus is still low, unsustainable, and the risk of trade deficit still exists. However, export turnover has increased.

According to a report by the General Statistics Office, from the beginning of the year until now, import and export have remained the pillars of Vietnam's economic growth.

In July 2022, Vietnam's import and export activities continued to record a good increase. In which, export was estimated at 30.32 billion USD, up 8.9% over the same period last year, import was estimated at 30.3 billion USD, up 3.4%.

From the beginning of 2022 up to now, export turnover of goods is estimated at 216.35 billion USD, up 16.1% over the same period last year with 30 items with export turnover of over 1 billion USD, accounting for 91.9 % of total export turnover, of which phones and components have the largest export turnover, reaching 33.7 billion USD, up 13.1% over the same period last year; electronics, computers and components reached 31.7 billion USD, up 14.7%; machinery, equipment, tools and spare parts reached USD 24.9 billion, up 24.1%; textiles and garments reached USD 22.1 billion, up 19.8%; footwear reached 14.1 billion USD, up 19.6%. Notably, the domestic economic sector is increasingly asserting its contributing role when the export turnover of 7 months is 56.99 billion USD, an increase of 17%, higher than the growth rate of 15.7% of the FDI sector (including crude oil), accounting for 26.3% of total export turnover.

The group of fuels and minerals was estimated at 3.2 billion USD, up 56.2% over the same period in 2021; the group of processed industrial products was estimated at 192 billion USD, up 16%; the group of agricultural and forestry products was estimated at 14.6 billion USD, up 5.4%; seafood products were estimated at 6.6 billion USD, up 32.9%.

Most of the export markets achieved relatively high growth rates. In which, China is the market with the largest two-way trade relationship with an estimate of 103.1 billion USD, up 12.2% over the same period in 2021; in which, export is estimated at 30.4 billion USD, up 6.5%. The United States came in second place with an estimated $76 billion in two-way trade, up 20.7%; in which, exports reached 67.1 billion USD, up 24.3%. Korea is the market with import-export turnover ranked third with 51.3 billion USD, up 21.2%; in which, export is estimated at 13.9 billion USD, up 14.5%. ASEAN has two-way turnover estimated at 49 billion USD; in which exports reached 20.6 billion USD, up 27.1%. The EU market has two-way turnover estimated at 37.1 billion USD; in which export is estimated at 27.9 billion USD, up 22%. Japan has an estimated two-way turnover of 27.5 billion USD; in which exports reached 13.4 billion USD, up 12.9%. Also in the first seven months of 2022, the import turnover of goods was estimated at $215.59 billion, up 13.6% over the same period last year.

Because exports increased higher than imports, in the first 7 months of 2022, the trade balance of goods continued to maintain a trade surplus of 764 million USD. Although the trade surplus was not high, it was also a good signal for the recovery of the economy if compared with the same period last year, the trade balance of goods had a deficit of 3.31 billion USD.

According to the General Statistics Office, among the solutions to limit the trade deficit, the basic solution is still to improve the efficiency and competitiveness of domestic production for imports or exports. In addition, it is necessary to speed up supporting industries, minimize processing and assembly to reduce import dependence. In addition, it is necessary to have solutions to cope with the increase in the USD price, to encourage exports, and to limit imports, when the VND/USD exchange rate and the commodity trade rate have decreased for more than 2 years.

The General Statistics Office also commented that the current trade surplus is still low, unsustainable, and the risk of trade deficit is always present. Trade deficit not only affects the macro economy (balance of payments, exchange rate, foreign currency debt, inflation, etc) but also adversely affects economic growth, requiring solutions to prevent block.

However, it is necessary to continue to promote safe, flexible adaptation and good control of the epidemic to maintain and develop production and business, and keep pace with the recovery momentum and new development trends of the world. At the same time, taking advantage of the advantages from Free Trade Agreements (FTAs) with most of the key markets in the world, creating a great impetus for production and export activities.

PV