Industrial production towards targets growth of 7-8%

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In 2023, the industry made an impressive comeback.

Remarkable effort

According to the Ministry of Industry and Trade, the increase in the processing and manufacturing sector in the last months of 2023 has pushed up the production index of the entire industry in 2023 compared to the same period last year (IIP in 2023 is estimated to increase by 2.3% compared to 2022; in which the manufacturing and processing industry is estimated to increase by 3.1%, higher than the general growth rate of the entire industry). The added value of the industrial sector is estimated to increase by 2.98% for the whole year, of which the processing and manufacturing industry is estimated to increase by 3.48%, positively contributing to the recovery of the economy.

The production index of some key level 2 industries in 2023 is estimated to increase compared to the same period last year: Production of products from rubber and plastic is estimated to increase by 9.7%; Metal ore exploitation increased by 10.2%; Tobacco production is estimated to increase by 10.2%; Chemical and chemical product production is estimated to increase by 8.5%; Production of products from prefabricated metal (except machinery and equipment) increased by 6.7%; Production of beds, wardrobes, tables and chairs is estimated to increase by 6.7%; Food processing production is estimated to increase by 6.5%; textiles are estimated to increase by 6.1%, etc.

Many localities have made efforts to overcome difficulties, gradually restore production, and maintain good industrial achievements with the IIP index increasing in most localities across the country (increasing in 50 localities and decreasing in 13 localities). The localities that maintain good growth are: Tra Vinh, Bac Giang, Phu Tho, Nam Dinh, Khanh Hoa, Kien Giang, Ha Nam, Hai Phong, Ninh Thuan, Dak Lak, Quang Ninh, Bac Kan, Hau Giang, Phu Yen, Thai Binh, etc.

However, recognizing the limitations in industrial production, the Ministry of Industry and Trade assessed that, although the industrial production index had positive changes, it was still slow, starting to recover from the end of the third quarter and the beginning of the fourth quarter, IIP of the entire industry in 2023 was estimated to increase by only about 2.3%, the lowest increase in the last 10 years.

The IIP index of some key export industries is estimated to decrease compared to the same period last year, such as: Apparel production is estimated to decrease by 1.8%; Wood processing and production of products from wood, bamboo (except beds, cabinets, tables, chairs) decreased by 1.9%; Production of motor vehicles and trailers is estimated to decrease by 5.1%; Production of products from other non-metallic minerals decreased by 3.7%; Crude oil and natural gas exploitation decreased by 1.7%; Production of other means of transport is estimated to decrease by 7.7%.

The processing and manufacturing industry has been the driving force for economic growth in previous years but only achieved a modest growth rate in 2023 because the production of processed goods (garment, footwear, electronics, wooden furniture) was much lower than the same period in 2022 due to reduced world market demand and shortage of orders.

In addition, the steel and construction materials industries are facing difficulties due to the domestic real estate market continuing to be sluggish and world demand decreasing, supply exceeding demand, domestic and export orders both decreasing; The textile and garment industry, footwear, wood and wood products, phones of all kinds and components also face a shortage of export orders (the export turnover of these industries was estimated to decrease by 16.9%; 12,2%; 17.1% and 7.4% respectively in 2023) that affected the overall growth rate of the entire industry.

Some key industrial products are estimated to decrease compared to the same period last year such as: motorbikes are estimated to decrease by 23.5%; television is estimated to decrease by 43.5%; Casual clothing decreased by 1.6%; Crude oil is estimated to decrease by 3.8%; Petroleum is estimated to decrease by 8.4%; Urea nitrogen fertilizer is decreased by 1.9%; Rolled steel is estimated to decrease by 22.2%; Natural gas is estimated to decrease by 7.4%; Cement is estimated to decrease by 1.3%, etc.

Notably, the restructuring within the industrial sector towards increasing the proportion of the manufacturing and processing industry, gradually reducing the mining industry, and from labor-intensive industries to high-tech industries partially stagnates when the export proportion of processed and manufactured goods was estimated to decrease slightly from 86% in 2022 to 85% in 2023, etc.

Revive key industries

The Department of Industry (Ministry of Industry and Trade) assesses that in 2024, domestic industries are expected to continue to face many challenges. The global economy is expected to recover but at a very slow pace, especially the impact of the slow growth of the Chinese economy will lead to many difficulties on both the supply and demand sides of global and regional production, including Vietnam. Domestically, purchasing power is expected to slowly recover; Accessing and using business resources will still face many difficulties; The declining real estate market will continue to directly affect many related manufacturing industries.

Therefore, to achieve the target of increasing the index of industrial production (IIP) by about 7-8%, many solutions need to be focused. According to the Department of Industry, in 2024, we will continue to proactively and effectively implement business support policies approved by the Government to remove difficulties and obstacles in production and business activities of enterprises. especially in key export industries such as textiles and garments, leather - shoes and foundation industries such as automobiles, mechanics, steel; Promote the operation of new industrial production projects to serve export and domestic consumption, creating more capacity for production development and source of goods for export.

In addition, soon submit and promulgate the plan to implement the Planning for exploration, exploitation, processing and use of minerals to soon exploit, process and use mineral resources of great value, creating new sources of growth motivation. At the same time, coordinate with relevant agencies to research and advise on policies to stimulate domestic consumption of industrial goods, etc.