Positive outlook ahead for exports amid global market rally

Exports last month regained their strength after slowing down in the previous month thanks to the expansion of business markets coupled with trade promotion efforts.

According to the Ministry of Industry and Trade, the total import-export value in October hit US$61.62 billion, representing an increase of 4.1% month on month and 5.6% year on year. Of the total value, exports brought back US$32.2 billion, up 5.3% compared to September.

Overall, the initial 10 months saw total import - export turnover reach US$557.95 billion, an annual drop of 9.6%. The falling rate started slowing gradually as opposed to the double-digit decline recorded in the first half of the year.

Statistics indicate the export value in the first six months of the year fell by 11.6% year on year to US$165 billion. By the end of October, the export value rose to US$291.46 billion, down just 7% compared to the same period from last year.

Most notably throughout the July-October period, the country raked in at least US$30 billion in export each month, which is much higher than the monthly average of US$27.61 billion documented in the first half of the year.

Experts have pinned high hopes on a boost in exports occurring in the last two months of the year due to a significant purchasing power of consumers globally for the Christmas festive season and New Year holiday.

Garments remains one of the main industries bearing the brunt of the global market shrinking, with orders declining by 20% to 30% in the first nine months. However, the situation has shown positive signs over recent months.

Pham Van Viet, chairman of the Board of Directors of Viet Thang Jean Company Limited (VitaJean), told Cong Thuong (Industry and Commerce) newspaper that his company has received an increased number of orders from importers, though the recovery rate has only met approximately 80% of pre-pandemic levels.

“Despite the gradual recovery, this has motivated the company to focus on production and complete orders for the remaining months of the year,” said Viet.

Another reason why experts have placed their trust in the warming up of the export market globally is that imports have continued to rise slightly. Statistics indicate that businesses imported US$26.09 billion worth of materials in October, an increase of 7.2% year on year. The rise in the import value of materials for production of export items signaled the recovery of industrial production for domestic use and export in the year-end shopping season.

Furthermore, inventories in markets that represent major Vietnamese goods consumers such as the United States are decreasing considerably. According to the Ministry of Industry and Trade, inventories in the US, which is Vietnam’s largest export market, tumbled from 20% in June to 10% in August, and the figure í expected to keep falling to zero by the year’s end. This will give local businesses a boost as they export their products over the coming two months.

The Government, in the latest monthly meeting, asked ministries, agencies, and localities to iron out snags to spur forward industrial production. The Ministry of Industry and Trade also vowed to increase support for firms as they seek to take advantage of commitments in free trade agreements between Vietnam and key partners such as the EU (EVFTA), the UK (UKVFTA), the Comprehensive and Progressive Agreement for Trans-Pacific partnership (CPTPP), or the newly signed FTA with Israel, to boost exports.

Businesses are also making every effort to boost production and exports in the remaining months of the year to incur losses recorded in previous months due to market stagnation.