During the first 11 months of the year, Vietnam's exports stood at an estimated US$241.2 billion, up 7.8 per cent on year.
Of the figure, export turnover within the domestic sector enjoyed an 18.1 per cent surge to US$74.72 billion, while exports in the FDI sector, including crude oil, were at US$166.7 billion, an increase of 3.8 per cent.
According to the Import-Export Department under the Ministry of Industry and Trade (MoIT), a number of favourable factors such as the comprehensive international integration have served to support the Vietnam’s exports in the future as the country has become a signatory of 13 FTAs with a further three FTAs in the negotiation process.
Furthermore, domestic goods for export will become more competitive with other providers due to the removal of tariff barriers.
Despite this, several factors look poised to hinder export growth, including a global economic slowdown.
The Organisation for Economic Cooperation and Development cut its prediction for the world’s economic growth by 0.1 percentage points to 2.9 per cent by 2020.
The International Monetary Fund has also slashed its economic growth forecast for the country to 3 per cent in 2019. Furthermore, the ongoing trade war between the US and China has also made a multi-dimensional impact on the country’s trade activities.
Most notably, farm produce and aquatic exports to the Chinese market have encountered difficulties with China strengthening its control over the quality of imported products.
In October alone, the Purchasing Managers’ Index of Vietnam plunged for the third consecutive month to only 50, representing its lowest level for the past four years and signaling a gloomy picture in the health of the processing and manufacturing sector.
Phones and components, the nation’s export item that enjoys the highest turnover, is starting to endure a slow growth. In addition, several key export items face numerous challenges as the EU has yet to remove its yellow card on Vietnamese seafood.
Meanwhile, local businesses have to face fiercer competition with many other countries engaging in supplying farm produce amid falling demand.
According to experts, in the coming time, due attention should be paid to issues relating to quality control, origin traceability, processing capacity, farm produce preservation, and the supporting industry.
In order to make export growth sustainable, the MoIT underscored the need to devise major solutions to monitor fluctuations within the world’s economy, especially the US-China trade war, and intensify management over trade fraud occurring in the origin of goods.
Businesses have been advised to generate high-quality goods, whilst also increasing the added value of these items, and launching products aimed at meeting strict requirements of quality, food and safety in line with the importers’ demands.
Local firms should therefore be instructed to apply modern quality control systems and attempt to speed up their use of science and technology as a means of enhancing production capacity and providing high-quality domestic products that enjoy higher levels of competitiveness.
Relevant ministries and agencies have been urged to strengthen research and forecast work for trade defence instruments that are being imposed on Vietnamese goods and remove obstacles for businesses in order to boost exports and market expansion.
Furthermore, Vietnam needs to accelerate the process of negotiating and signing FTAs with other nations.
Moreover, special attention should be paid to the implementation of the country’s commitments to the international integration and stricter control over goods being imported into the nation.