Massive surge in exports possible, official says

Minister and Chairman of the Government’s Office, Mai Tien Dung, said at a press conference on October 3 that this achievement is possible with concerted efforts by all stakeholders including businesses, ministries and agencies.

If this target is achieved, it would far exceed the target of US$188 billion set for the year. The target was later revised to US$202 billion.

Dũng, who based his statement on a new report by the Ministry of Industry and Trade (MOIT), said exports had already posted an impressive 19.8% year-on-year increase in the first nine months of the year.

According to the General Statistics Office (GSO), exports by the domestic sector in the first nine months touched US$43.2 billion, a 16.8% increase, while those of the foreign-invested sector was US$110.8 billion, an increase of 21%.

The United States remained the largest consumer of Vietnamese goods at US$31.2 billion, followed by the EU and China at US$28.4 billion and US$21.9 billion, respectively.

Import turnover during the first nine months jumped 23.1% year-on-year to US$154.5 billion, with imports by the domestic sector touching US$61.3 billion, an 18.7% increase, and that of the foreign-invested sector rising 26.1% to US$93.2 billion.

China continued to be the largest importer of Vietnamese goods at US$41.6 billion, a year-on-year surge of 15.6%. The Republic of Korea (RoK) and ASEAN came second and third with US$33.9 billion and US$20.6 billion, respectively.

Vietnam’s trade deficit for the periods is estimated at US$500 million.

The trade deficit incurred by the domestic sector totaled US$18.08 billion, and that of the foreign-invested sector was US$17.64 billion.

Potentials, challenges

Experts have said that the growth potential for exports is very high, with Vietnamese goods and commodities present in nearly 200 countries and territories.

Along with the focus on exports to key markets with high purchasing power like the US, the EU, Japan, RoK, China and ASEAN, Vietnamese goods have also expanded to Africa and Latin America.

However, the country is expected to face many obstacles and challenges ahead, including competition from other countries dealing in similar commodities and goods, pressure from anti-dumping lawsuits, and other trade barriers arising out of increasing protectionism in importing countries.

Moreover, Vietnamese exports are still focused on scale and quantity rather than quality and value, the experts said.

Tran Thanh Hai, deputy director of the MOIT’s Export Department told the Thời báo Kinh tế Việt Nam (Vietnam Economic Times) newspaper that although Vietnam had joined the global supply chain, its role remains modest.

The country’s export turnover was still heavily dependent on exports of FDI enterprises, with their contribution much higher than that of domestic firms.

Besides, Hai said, FDI firms have not supported local businesses in strengthening their presence in the global supply chain.

The under-developed supporting industry is also hindering domestic firms by forcing them to import a large quantity of components, he said.

Hai also stressed that most Vietnamese enterprises have not fully grasped and updated their knowledge of FTA provisions, and this restricts their ability to make proper business plans before exporting.

He said domestic firms need to increase their competitiveness by improving corporate governance and applying technological innovations.

In the processing and manufacturing sectors, enterprises will find it difficult to sustain their exports if they ignore development of the supporting industry, Hai said, adding this task must be accorded top priority.

He said it was very important that the localisation rate in key industries like mechanical products, electronic components and devices, textiles and footwear increases significantly in the near future.