Vietnam’s trade ambitions can be seen from Vietnam’s export data in the first two months
In 2022, Vietnam has handed over a pretty good report. Whether it is placed on a global scale or in the Asian region, Vietnam’s economic growth rate in 2022 can be regarded as the best. Last year, the country’s GDP grew by 8.02%, which not only set the fastest growth rate in 25 years, but also set the highest growth record in the past 10 years, and also greatly exceeded the official expected growth target of 6.0%-6.5%. Among them, the promotion of foreign trade is very important. Vietnam’s total foreign trade value in 2022 will exceed $700 billion for the first time, and the specific data will be $732.5 billion. Among them, the export volume reached $371.8 billion, an increase of over 10%. The United States is Vietnam’s largest exporter.
Detailed explanation of Vietnam’s export data from January to February
The slowdown in demand is a common problem faced by traders around the world. Entering 2023, except for the oil countries in the Middle East, most of the world’s exports of manufacturing products will drop, and South Korea, Vietnam, and other countries will all drop by more than 10%. In the first two months of 2023, Vietnam’s export value is expected to be $49.44 billion, a decrease of 10.4%. On a monthly basis, Vietnam’s exports fell in January and rebounded in February. In January 2023, Vietnam’s merchandise exports reached only $23.61 billion, a sharp drop of 25.9% year-on-year. Mobile phones and components are the only major export commodities in Vietnam that will achieve positive growth in January 2023, with an export value of more than $5 billion, a year-on-year increase of 2.1%.
In February, Vietnam’s merchandise exports were estimated at $25.88 billion, a month-on-month increase of 9.8% and a year-on-year increase of 11%. Among the merchandise exports in January-February 2022, Vietnam’s domestic economic sector exported $11.52 billion, down 21.1%, accounting for 23.3% of total exports. In terms of export markets: the United States is still Vietnam’s largest export market, with an estimated export value of $13.1 billion, but a year-on-year decrease of 21%; exports to the EU were $6.9 billion, a decrease of 4.2%; exports to ASEAN were $4.6 billion, a decrease of 8%; Exports to South Korea reached US$3.5 billion, down 5.7%; exports to Japan reached $3.2 billion, down 5.9%. Meanwhile, China remains Vietnam’s largest source of goods. According to statistics, in the first two months of 2023, Vietnam’s imports from China were expected to be $14.6 billion, a decrease of 21.2% compared to the same period in 2022.
Opportunities and pressures in Vietnam
The current impact on Vietnam’s exports is particularly obvious. Many companies have reduced temporary workers, employees have taken turns taking a break from work, and some production lines for bulk export commodities must be shut down. Regarding textiles and clothing, the vice chairman and secretary-general of the Vietnam Leather, Shoes, and Bags Association, said that enterprises directly under the association are facing many difficulties, and their inventory is as high as 40%. From 2022 to 2023, there were also fewer new orders for the first quarter.
In addition to reaching a free trade agreement with the European Union, as a member of ASEAN, Vietnam has also fully enjoyed the huge dividends of RCEP’s entry into force. Vietnam’s agricultural and seafood products, which originally had competitive advantages, can enter the market at low or even zero cost. A broader market, and at the same time, a larger scale of foreign capital, predominantly Asian international capital, is pouring into Vietnam. In the composition of FDI entering Vietnam in 2022, Singapore, South Korea, Japan, and China rank in the top four, directly enriching Vietnam’s international trade.
The proportion of foreign-funded enterprises in Vietnam’s total merchandise exports is increasing, especially in 2022, the proportion of foreign-funded enterprises’ merchandise exports will account for more than 74%. In the process of transferring to a higher production chain, Vietnamese enterprises are slower than foreign-funded enterprises, and Vietnamese private enterprises are not as good as foreign-funded enterprises in taking advantage of the free trade agreements signed by Vietnam. The Vietnamese government plans to increase the amount of FDI in 2023 to $36 billion-$38 billion, and the focus of the introduction is on projects with high technological content, high added value, positive spillover effects, and connections with global production and supply chains.
Vietnam has set a target of 6% year-on-year growth in exports in 2023, equivalent to $393 billion to $393.4 billion. When analyzing the opportunities and challenges of Vietnam’s commodity import and export in 2023, the director of the import and export Bureau of the Ministry of Industry and Trade of Vietnam, said that the decline in world demand is the difficulty and challenge that Vietnam’s exports will face in 2023. On the supply side, the opening of China’s economy after Covid-19 could lead to more competition for Vietnamese exports in the world market.
