In the first month of 2023, Vietnam had a trade surplus of 3.6 billion USD

Market Information
icon date25/07/2023

Due to the occurrence of both the New Year and Lunar New Year in January 2023, the number of working days was lower compared to the previous month and the same month last year. As a result, there was a decrease in the total export and import turnover of goods during the month. However, despite the decline, the trade balance of goods for January 2023 is expected to have a surplus of $3.6 billion USD.

Total export and import turnover of goods in January 2023

The Vietnamese Ministry of Industry and Trade has reported that the country’s exports fell by 13.6% in January 2023 to an estimated $25.08 billion, compared to the previous month. The domestic economic sector saw exports drop by 18% to $6.44 billion, while the foreign-invested sector declined 12% to $18.64 billion, including crude oil. Exports were down by 21.3% compared to January 2022, with the domestic sector down 27.1% and the foreign-invested sector, including crude oil, down 19%.

Seven items contributed over $1 billion to the total export turnover, accounting for 66.6% of the total. These were phones and components, electronics, computers and components, other machinery, equipment, tools and spare parts, textiles, footwear, wood and wood products, and means of transport and spare parts.

The processing and manufacturing industry, which was previously the driving force of export growth, did not perform as well as other categories. The growth in export turnover of processed industrial goods in January 2023 decreased by 22.7% compared to the same period last year. This is due to most enterprises in the processing and manufacturing industries temporarily stopping production for the Tet holiday, except for some enterprises in the paper, cement, steel, fertilizer, nitrogen, chemical, and processed products sectors, which maintain a certain output due to their production lines’ continuous operation.

In terms of export markets, exports to the main markets of the US, China, and the EU fell sharply, with the US experiencing a decline of 28.5% and the EU down 33.8%. China saw a rise in exports, up by 14%, while exports to Japan decreased by 11.4%, and Korea’s exports were down 18.4%.

Imports also declined in January 2023, with an estimated value of $21.48 billion, down 21.3% compared to the previous month. The domestic economic sector experienced a decline of 26.6% to $7.48 billion, while the FDI sector decreased by 18.1% to $14 billion, with a total import turnover decrease of 28.9% compared to the same period last year. Production materials accounted for 93% of imports, with machinery, equipment, tools, and spare parts making up 41.1%, and raw materials, fuel, and materials accounting for 51.9%. Consumer goods accounted for 7%.

China remained the largest import market for Vietnam with an estimated turnover of $8.1 billion in January 2023. Vietnam had a merchandise trade balance in January 2023 with a trade surplus of $3.6 billion, with the domestic economic sector experiencing a trade deficit of $1.04 billion, and the foreign-invested sector (including crude oil) having a trade surplus of $4.64 billion.

Assessment on the situation and solutions for import and export of goods in 2023

During the Conference to promote domestic consumption production and expand export markets to 2023 on February 3, Mr. Phan Van Chinh – Director of the Import-Export Department – expressed concerns about the challenges that may arise in the coming year. In order to continue promoting import and export and developing foreign markets, the Ministry of Industry and Trade will focus on implementing the tasks and solutions set out in Resolution No. 01/NQ-CP of the Ministry of Industry and Trade. The government has identified the main tasks and solutions to implement the socio-economic development plan, the state budget estimate, and improve the business environment, and national competitiveness in 2023.

One of the first areas of focus is improving the ability to analyze, forecast, and develop scenarios to adapt to new problems. The ministry will also advise and closely manage fluctuations of the international economy and commodity prices on the world market to support associations and import-export enterprises. They will actively exploit opportunities and promptly respond to difficulties and challenges.

The Ministry of Industry and Trade will also promote the effective exploitation of signed Free Trade Agreements, especially new generation FTAs with the European Union, the United Kingdom, and CPTPP countries. They will also promote the export and import of goods to the Chinese market when China has reopened.

Efficiency and well-regulated speed of customs clearance of import and export goods will be improved at the northern border gate area, especially for seasonal agricultural and aquatic products. At the same time, they will actively support localities and enterprises to switch to official export in association with branding, promoting sustainable export.

The role of the system of Vietnam Trade Office agencies abroad will be promoted to support localities and industry associations. The Ministry of Industry and Trade will organize regular briefings between Trade Office agencies and industry and business associations to help them expand and diversify markets and supply chains, and overcome technical barriers to penetrate new markets.

Finally, trade facilitation will be continued, administrative procedures will be reformed, logistics services will be developed, trade promotion will be renewed, and cross-border e-commerce will be developed to promote exports. With the export growth target of 6%, the export turnover in 2023 is expected to reach 393-394 billion USD, an increase of about 22 billion USD in the export value of goods compared to 2022. Achieving this goal will require a lot of effort from the entire political system, ministries, branches, localities, associations, and business communities.

In conclusion, the import and export industry in Vietnam may still face many difficulties in the coming year, but with the right strategies and efforts, it can still achieve strong growth. The Ministry of Industry and Trade has identified the main tasks and solutions to promote import and export, develop foreign markets, and improve national competitiveness. With the goal of increasing export turnover, Vietnam’s import and export industry is poised to continue its growth trajectory.