Industrial production and trade: Satisfactory Q1 results

The export structure of the first quarter of 2019 showed positive changes

According to Duong Duy Hung, Director of the Ministry of Industry and Trade (MoIT)’s Planning Department, the index of industrial production (IIP) in the first quarter grew 9.2 percent compared with the same period last year. The IIP of the processing and manufacturing industries grew 11.1 percent. These results were satisfactory compared with those in the 2012-2017 period.

Meanwhile, the global Purchasing Manager Index has decreased, Hung said. In Vietnam, this index has dropped from 51.9 points to 51.2 points. In ASEAN, it has also been down from 49.7 points to 49.6 points. In this context, the industrial production and trade results Vietnam achieved in the first quarter of 2019 could be said to be satisfactory.

Regarding trade, Tran Thanh Hai, Deputy Director of the MoIT’s Foreign Trade Agency, said Vietnam exported an estimated US$58.51 billion worth of goods in the first quarter of 2019, an increase of 4.7 percent compared with the same period last year. The export value of the domestic sector accounted for US$17.05 billion, while the foreign-invested sector, including crude oil businesses, contributed US$41.46 billion to the total. First quarter foreign trade results yielded a surplus of US$536 million for Vietnam.

Notably, the domestic sector achieved an export growth rate of 9.7 percent in the first quarter, while the export value of the foreign-invested sector grew only 2.7 percent. This reflects the impact of government efforts to improve the investment and business environment for domestic companies. In the structure of export goods, the percentage of agricultural, forest and aquatic products, such as vegetables, fruit, rice, coffee and rubber, as well as key industrial products, such as telephones and components, decreased. This had a major impact on the export results of the first quarter.

Overall, the situation of imports in the first quarter gave almost no cause for concern, except for the 18.8 percent growth in the import of autos with less than nine seats compared with the first quarter of 2018.

The MoIT is thinking of creating a trade barrier to restrict the import of these vehicles and prevent an adverse impact on the domestic auto sector.

Deputy Minister of Industry and Trade Tran Quoc Khanh said the decline of global trade in the first quarter of 2019 was at the worst level in the past decade. In the context of negative export growth in neighboring countries, Vietnam’s first quarter results were satisfactory. On behalf of the MoIT, he asked the Ministry of Agriculture and Rural Development to accelerate negotiations to promote fruit exports to China via official trade channels.

In the domestic market, total retail sales of goods and revenue from consumer services in the first quarter of 2019 grew 12 percent compared with the same period last year. Discounting price increases, growth reached 8.9 percent. Obviously, the domestic market keeps growing well and contributing significantly to the Vietnamese economy.