Exports in the first quarter "supported" economic recovery

VCN - Continue the recovery momentum at the end of 2023, exports in the first quarter positively contributed to the growth results of the whole economy in the early period of 2024.
Global export opportunities for wood and furniture products through e-commerce Global export opportunities for wood and furniture products through e-commerce
Exports in first 2 months reach high record ever Exports in first 2 months reach high record ever
Agricultural product exports boom in first months of 2024 Agricultural product exports boom in first months of 2024
Import and export goods at Hai Phong port area, March 2024. Thai Binh photo
Import and export goods at Hai Phong port area, March 2024. Thai Binh photo

Increase input, output "takes off"

The General Statistics Office's assessment shows that in the first quarter of 2024, world aggregate demand will maintain a recovery trend from the fourth quarter of 2023. The World Bank (WB) forecasts that global trade growth will increase from 0.2% in 2023 to 2.3% in 2024 and IMF estimates that world trade growth will reach 3.3% in 2024. At that time, domestically, the production plans of some leading export enterprises such as Samsung and Intel set a positive growth plan for production in 2024. The above factors contributed to the positive results of Vietnam's import and export activities in the first quarter of 2024, being a bright spot of the economy, with export turnover increasing by 17% and import turnover increasing by 13,9% over the same period in 2023.

The General Statistics Office said that according to the results of the survey on production and business trends in the processing and manufacturing industry, businesses forecast production and business activities in the second quarter to be more positive than the first quarter, 82% of businesses evaluate the production and business activities in the second quarter to be better and more stable compared to the first quarter. Specifically, 45.4% of businesses evaluated production and business activities to be better, 36.6% evaluated production and business activities to be stable, only 18% of businesses assess production and business activities in the second quarter to be more difficult than the first quarter of 2024.

The increase in input factors such as raw materials and fuel for export also shows the recovery of production and export activities of enterprises.

According to the Ministry of Industry and Trade, in the first quarter, 89% of Vietnam's total import turnover is the group of goods that need to be imported, including machinery, equipment, tools, spare parts and raw materials for domestic production, with an estimated turnover of 75.7 billion USD, an increase of 16.1% over the same period in 2023. Of which, the import turnover of computers, electronic products and components is estimated at 23.9 billion USD, up 23.6% compared to the first quarter of 2023; machinery, equipment, tools and spare parts increased by 12.1%. Similarly, import turnover of most other products also recorded an increase such as: steel of all kinds increased by nearly 32%; Plastic raw materials increased by 8.5%; Raw materials for textiles, garments and footwear increased by 9.1%; fabrics of all kinds increased by 2.7%.

At the local level, industrial production increased on a large scale when the industrial production index in the first quarter of 2024 increased in 54/63 localities. In particular, some localities have had a fairly high increase in the IIP index of two to three digits due to high increases in the processing and manufacturing industries or the electricity production and distribution industry (Tra Vinh's IIP increased by 102, %; Khanh Hoa increased by 37%; Bac Giang increased by 23.9%; Thanh Hoa increased by 20%; Ha Nam increased by 17.2%; Quang Ninh increased by 14%, etc).

In particular, the inventory index of the entire processing and manufacturing industry also shows positive signs in the recovery of production and product consumption, estimated to increase by 9.0% as of March 31, 2024, an increase of 9.8% compared to the same time last month and up 14.1% compared to the same time last year (same time last year increased 19.8%). The average inventory rate in the entire processing and manufacturing industry in the first quarter is 68.7% (average in the first quarter of 2023 is 81.1%).

Factors that increase the source of imported raw materials as well as the industrial production index of many key industries reflect the recovery of production and exports. Analyzing specifically the import-export situation of industries and markets, the Ministry of Industry and Trade informed that in the first quarter, there were 16 products with export turnover of over 1 billion USD, accounting for 82.1% of total export turnover (there are 4 export items with over 5 billion USD, accounting for 52.7%), 2 more items than the same period last year (in the first quarter of 2023, there were 14 items with export turnover of over 1 billion USD) .

Notably, exports grew strongly and evenly in all three commodity groups: agriculture, forestry, and aquatic products; manufacturing and processing industry; mineral fuel. For the agriculture, forestry and fishery products group, export turnover is estimated at 8.46 billion USD, up 23.8% over the same period in 2023, accounting for 9.09% of the total export turnover of the country. In this group, some products have high export turnover compared to the same period last year such as: coffee increased by 54.2%; rice increased by 40%; tea of all kinds increased by 27%; vegetables and fruits increased by 25.8%; cashew kernels increased by 20.5%; Cassava and products from cassava increased by 21.1%.

In particular, the group of processing and manufacturing industrial goods has an estimated export turnover of 79.6 billion USD, accounting for 86% of total export turnover and an increase of 17.5% over the same period in 2023. The Ministry of Industry and Trade said, the export turnover of many groups of processed industrial products achieved high growth rates (some product groups grew at two to three digits), in which key export items such as: plastic products increased nearly 132%; wood and wood products increased by 18.9%; textiles and garments increased by 7.9%; footwear of all kinds increased by 11.7%; iron and steel of all kinds increased by 32.7%; computers, electronic products and components increased by 30.3%; phones of all types and components increased by 9.7%; other machinery, equipment, tools, and spare parts increased by 10.2%. The fuel group also shared the same increase, with export turnover estimated at 1.13 billion USD, up 12.1% over the same period in 2023.

Many of Vietnam's major export markets have recovered, overcoming the recession period, which is considered a positive signal for import and export activities in the near future. In particular, Vietnam's key export market, the United States, achieved high growth, with an estimated turnover of 26.06 billion USD, accounting for 28% of the country's total export turnover and an increase of 25.5% compared to the same period last year (same period in 2023 down 21%); Next is China, it is estimated at 12.68 billion USD, up 5.2% (same period in 2023, down 10.2%); The EU market is estimated to reach 12.1 billion USD, up 16.3% (same period in 2023 down 10.3%); Korea is estimated to reach 6.6 billion USD, up 12.9% (same period in 2023, down 5.4%); Japan is estimated to reach 5.7 billion USD, up 6.4% (same period in 2023 down 0.4%).

The barriers to sustainably develop are getting bigger and bigger

Despite achieving many positive results in the first quarter, the Ministry of Industry and Trade said that the world situation is expected to continue to become complicated and unpredictable; World economic growth remains at a low level; Global merchandise trade growth is forecast to remain modest, with improvement but not much. According to the World Trade Organization (WTO), merchandise trade growth will increase by 3.2% by 2024, etc.

Domestically, Vietnam's import and export activities in 2024, especially exports to key markets such as Europe and America, will have both advantages and challenges. Specifically, existing Free Trade Agreements (FTAs) with partners and markets continue to have a positive impact, maintaining Vietnam's advantages in trade and investment activities; World market demand in general and the European and American market regions are gradually recovering. Furthermore, the fact that industrialized countries continue to promote the strategy of supply diversification, supply chain diversification, and investment diversification will help Vietnam become an important production and export center in the global value chain. In parallel, countries in Europe and America promote the development of green economy, digital transformation, and circular economy, opening up many new cooperation opportunities as well as providing a lot of credit and technology support for Vietnam.

However, assessing the difficulties in the coming time, according to the Ministry of Industry and Trade, the global economy is entering a new period with many risks, challenges and difficulties in predicting; Economic growth in the world and European-American countries in 2024 is forecast to be lower than in 2023; Geopolitical conflicts continue to persist and instability continues to threaten to spread to other regions; The trend of deglobalization is continuing to rise strongly.

Notably, protectionist policies of countries are increasing day by day. The fact that developed countries pay more attention to the issues of sustainable development, combating climate change, and consumer safety continues to be the premise for establishing new standards and regulations related to the supply chain, raw materials, labor, and environment to be stricter for imported products. The fact that countries diversify their supply sources outside of China, focusing on a number of partners near the market and partners equivalent to Vietnam such as Turkey, Mexico, India, Indonesia, Bangladesh, etc will increase the competition in Vietnam's export markets, etc.

To boost exports in the following months, Deputy Minister of Industry and Trade Nguyen Sinh Nhat Tan said that in addition to continuing to expand and study to sign more FTAs, Vietnam will continue to enhance upgrading of current FTAs such as FTA related to ASEAN, continuing to expand the market; exploit traditional markets.

According to leaders of the Ministry of Industry and Trade, export and import activities still depend on a number of main markets; The contribution of domestic enterprises to exports is still limited. To maintain growth momentum, the Ministry of Industry and Trade will work with relevant ministries and branches to continue to support businesses to take advantage of current FTAs, upgrade FTAs to expand markets, and increase the export capacity of Vietnam Commodities. At the same time, closely monitor market developments and policy changes of partners to propose appropriate solutions and develop a variety of traditional and new export markets. In addition, continue to inform industry associations about developments in export markets so that businesses can promptly adjust production plans accordingly and orient their search for orders from markets.

By Ngoc Linh/ Phuong Linh

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