09:48 | 25/06/2019 Trade
(VEN) - Vietnamese exports in the first five months of 2019 grew at a lower rate compared with the same period last year due to negative changes in the global economy. However, the export value keeps increasing.
According to the Ministry of Industry and Trade (MoIT), the export value reached an estimated US$21.5 billion in May 2019, 5.2 percent higher than April. In the first five months, the export value was estimated at US$100.74 billion, up 6.7 percent compared with the same period last year. The domestic sector contributed US$30.33 billion or 30.1 percent to total export value; the remainder, more than US$70.40 billion or 69.9 percent, came from the foreign invested sector, including crude oil.
The five-month export value of agricultural, forest and aquatic products reached nearly US$10.24 billion; fuels and minerals more than US$1.85 billion, down 7.2 percent and 4.9 percent, respectively, compared with the same period last year. Lower export value was recorded for seafood, cashew nuts, coffee, pepper, rice, cassava and cassava products.
Processing industry-related products continued to contribute significantly to export growth, with value reaching nearly US$84.03 billion, accounting for 83.4 percent of the total and up 8.6 percent compared with the first five months of 2018. Increased export value was recorded for most major products in this group, such as computers, electronic products and components, textiles and garments, footwear, machinery, equipment, instruments and spare parts, timber and wood products, telephones and components. Telephones and components topped the list of 19 products with five-month export value exceeding US$1 billion.
The MoIT said despite a slowdown compared with the first five months of 2018, the export growth rate increased month over month, from 4.2 percent in the first two months to 5.3 percent in the first three months, 6.5 percent in the first four months and 6.7 percent in the first five months. The domestic sector maintained higher export growth compared with the foreign invested sector.
In the first five months, Vietnam faced a trade deficit of US$548 million. This was attributed to a strong increase in foreign direct investment (FDI) flows to Vietnam, which brought about higher demand for material, technology, machinery and equipment imports.
In the short run, Vietnamese exports are forecast to continue suffering the impact of a global trade decline and especially trade tensions between the US and China. In the first five months of 2019, however, Vietnam’s exports to the US grew 28 percent compared with the same period last year, reaching US$22.55 billion (in the first five months of 2018 compared with the same period of 2017, the growth was much lower, 10.2 percent). The strong increase in FDI flows also provided the basis for Vietnam to expect breakthroughs in exports.
The government has assigned the MoIT to achieve an annual export growth rate of 8-10 percent, higher than the 7-8 percent target set by the National Assembly. According to the MoIT, although exports often accelerate in the second half of the year, the task assigned by government is a difficult one that requires great efforts at all levels.