10:12 | 06/03/2018 Trade
China has overtaken the US to become Vietnam's largest importer as of January 2018, accounting for 77 percent of the country’s export market, official statistics show.
|Illustrative image - Source: VNA|
Vietnam's total exports value to China in January 2018 totalled nearly US$3.7 billion, up by US$1.9 billion, or 106 percent, over the same period last year, according to data from the General Department of Vietnam Customs (GDVC).
This time in previous years, China’s annual import value from Vietnam was a mere US$1.9 billion, making it the third biggest importer of Vietnam.
The main reason behind such strong bilateral trade growth is the scheduled commitments within the ASEAN-China Free Trade Area (ACFTA) framework.
As of January 1, 2018, another 588 tariff lines between Vietnam and China have been cut to zero percent, bringing the number of eliminated tariff lines to 8,571, accounting for 90.3 percent of total tariffs.
Statistics from the General Statistics Office (GSO) show that until December 2017, the US remained Vietnam's largest export market, but imports from Vietnam in January 2018 totalled US$3.6 billion, having increased US$624 million year-on-year.
The 3rd biggest importer of Vietnam in January 2018 is the EU at US$3 billion export value, up by 6.6 percent from January 2017; followed by ASEAN at US$1.7 billion, then Japan and the Republic of Korea at US$1.5 billion and US$1.3 billion, respectively.
In January 2018, the highest-valued Vietnamese exports to China were mobile phone components with a turnover of nearly US$895 million. In addition, exports of computer parts and electronic components to China also reached US$691 million in the first month of the year. Vegetables and fruits have risen to become the third most valuable export to China at US$296.3 million.
During the same period, Vietnam spent US$5.767 billion importing goods from China, meaning a trade deficit of US$2.059 billion. This number has decreased slightly by US$46 million, compared with the trade deficit of US$2.105 billion in January 2017.
In December 2017, the China International Finance Corporation (CICC) predicted that China will overtake the US as the world’s largest importer over the next five years.
They said that China is currently the largest exporter, and the second largest importer in the world, in the context of a stable domestic economy and recovering global commodity prices.
The CICC report notes that China’s trend of increasing imports has had a huge impact on the global market as it is the largest importer of 41 countries and territories.
As the world’s most populous market, China is expected to become the largest consumer market in the world and will start importing more consumer goods than raw industrial materials.