Export growth in the first five months of 2015 is not high on the strong decline of agricultural, seafood, fuel and mineral exports. Vietnam earned US$63.2 billion from exports in the January-May period, up 7.3 percent year on year.
Agriculture and seafood drag on exports
The domestic sector was estimated to rake in US$18.83 billion in the review period, down 2.7 percent while the foreign-led sector took US$44.37 billion (including crude oil), up 12.2 percent. In case crude oil was excluded, the value was US$42.83 billion, up 18.1 percent on year.
Agricultural and seafood exports were projected at US$8.14 billion, down 9.5 percent; and minerals and fuels brought home US$2 billion, down 53 percent. These two groups of commodities saw a combined drop of US$3.1 billion over a year-ago period.
According to the Ministry of Industry and Trade, although the export growth was not very high in the first five months, it was relatively positive in comparison with other countries in Southeast Asia and Northeast Asia. Specifically, Japan’s export value in the first quarter of 2015 climbed 8.5 percent year on year, driven by yen-pegged policy while some other countries witnessed declines. For instance, Indonesia’s exports slumped 11.7 percent to US$39.1 billion and Malaysia’s exports sank 2.5 percent to US$50.6 billion. South Korea and Singapore also saw a decline of 2.9 percent and 5.3 percent, respectively. The export slumps in other countries in the region were attributed to a sharp fall in crude oil prices and a considerable rise in global merchandise supply amid weak domestic demands, resulting in a price-cut competition among countries.
Vietnam’s shipments to the US soared 117.6 percent to account for 20.1 percent of its earnings. Its exports to the EU grew 8.6 percent and accounted for 18.7 percent of the share. Its export value to ASEAN slipped fell 3.7 percent and made up 12.1 percent of Vietnam’s exports. Its shipments to Japan declined 6 percent and accounted for 8.9 percent and the exports to China dipped 1.2 percent and contributed 9.7 percent to Vietnam’s export earnings.
Lower import prices benefit businesses
Vietnam was forecast to spend US$66.17 billion on imports in the first five months of 2015, up 15.8 percent from a year earlier. Of the sum, the domestic sector earned US$26.5 billion, up 6.3 percent, and the foreign-invested sector contributed US$39.68 billion, up by 23.2 percent.
Prices of production inputs like petroleum products, maize, rubber, cotton, iron and steel sank, thus encouraging businesses to buy more foreign products at lower value. The group of computers and electronic products and the group of telephones and parts were two biggest experiences.
Import growth was primarily seen in essential materials for domestic production, including equipment, machinery, tools and accessories for industrial production; computers, electronic devices and components; iron, steel and metals; and fuels like oil; corn; rubber; and cotton.
Import-restricted commodities were effectively controlled, accounting for 3.8 percent of the share.
In May, Vietnam’s export turnover was estimated US$13.5 billion, up 1.1 percent over April and up 9 percent over the same month of 2014.
On the import market, Asia remained the biggest supplier for Vietnam, accounting for 88.8 percent of its import spending. Of the sum, ASEAN countries contributed nearly 16 percent while East Asian nations accounted for 68.7 percent. China alone made up for nearly 31 percent.
Trade deficit was forecast at US$$900 million in May, equal to 6.7 percent of exports, raising the five-month deficit to US$2.97 billion, or 4.7 percent of total exports.