Vietnamese exports see highs and lows
HANOI - Vietnam's exports in 2001 reflect a paradox as the volume of its
main export items rose while their earnings dropped sharply.
Local crude oil exporters registered a year-on-year 1,000-tonne rise in
volume, but their earnings dropped by US$50 million this year. Rice, coffee,
pepper, and cashew nut exporters experienced a similar situation as the
prices of their products fell sharply in the world market over past months.
Vietnam sold 950,000 tonnes of coffee abroad in 2001, a year-on-year
increase of 200 tonnes, earning $400 million. This is $100 million less than
last year's amount. Similarly, the country's pepper export volume was
57,000 tonnes this year, a year-on-year rise of 17,000 tonnes, but earnings
dropped by $28 million to $92 million.
The country will register an estimated export turnover of $17.6 billion this
year, $1.76 billion lower than the annual target. Of the figure, earnings from
exports were estimated at $15.2 billion, $1.56 billion lower than the targeted
amount, and those from exports of services at $2.4 billion, $200 million less
than the target.
Export volume and earnings of Vietnam's two major exports, handicrafts
and electronics and personal computer (PC) spare parts, decreased sharply
during the year. It is estimated that export revenues from PC spare parts
were $610 million, $390 million lower than the annual target.
Vietnam's major importers, Japan and China, spent less than expected on
Vietnamese goods and services. Japan - the country's biggest partner -
imported goods and services worth $2.13 billion in the year-ending
November, up only 0.6 percent when compared with the same period last
year. Vietnam posted $1.24 billion in exports to China - the country's
second biggest trade partner - in the first 11 months of the year, a six
percent year-on-year increase.
Trade experts said that low competitiveness of locally-made farm, forest
and aquatic products was the main reason that the country fell short of its
annual export target. Low competitiveness, experts added, was due to less
attractive packaging, poor post-harvest preservation and processing
technology, and the failure to meet hygiene requirements.
In other export domains such as textiles and garments, leather and
footwear, electronics and PC spare parts, and handicrafts, the shortage of
capital, experience and market information as well as inefficient investment
resulted in high production costs for local products and reduced their
quality. Consequently, export earnings from these products dropped
sharply. According to the Trade Ministry's estimated figures, export
revenues from the textiles and garment sector fell short of the annual target
by $200 million and in leather and footwear, $210 million.
Economic experts warn that Vietnamese enterprises will surely lose out if
they continue to consider low wage payment, abundant natural resources
and state subsidies as the basis of development. They added that the
enactment of the bilateral trade agreement (BTA) between Vietnam and
the United States will create a level playing ground for both local and
foreign-invested enterprises.
The Trade Ministry predicted that Vietnam's total import value will reach
$16 billion this year, an annual import surplus of $800 million, equivalent to
last year's figure.
It is noteworthy that the import value of several products that can be locally
produced or manufactured is still high. The import of steel products in 2001
is a case in point: Import volume was recorded at 2.15 million tonnes, worth
$629 million, and was up 550,000 tonnes and $117 million, when compared
with annual targets. The country spent $151 million on importing 280,000
tonnes of paper, up $3 million and 30,000 tonnes against the annual targets.
Spending on imports of raw material, machinery and equipment this year is
lower than the annual plan. Vietnam will have spent an estimated $2.75
billion on the purchase of overseas machinery, spare parts and equipment in
2001, down $250 million against the annual target. Imports of textiles and
garment additives will be down by $400 million to $1.6 billion this year and
those of plastic material were $150 million and $500 million, respectively.
Five export-stimulus measures issued by Prime Minister Phan Van Khai on
December 13 target large markets like the European Union and the
overseas Vietnamese community, and give priority of investment to major
hard currency earners like rice. With these measures, the government
hopes to reach the target of at least 10 percent export revenue growth in
2002.
The move calls for improving aquatic product quality as well as strict
control of the fish-raising environment. Aquatic export turnover was almost
$1.7 billion in the past 11 months, $100 million more than planned for 2001.
Exporters of rice, coffee, tea, ground-nuts, beef and chicken, processed and
fresh vegetables and fruit, pepper, cashew-nuts, porcelain, wooden art
articles, and wickerwork are entitled to bonus policy and preferential credit
loans, according to the decision.
Marketing efforts are of high importance in the decision, which encourages
exploiting large potential markets such as the European Union, Japan,
China, Russia and the United States, while not reflecting markets in Africa
and Latin America, and encouraging cross-border trade and bartering.
The overseas Vietnamese community is a major target of the move. The
prime minister asked relevant authorities, including the Trade Ministry and
the Ministry of Planning and Investment, to consider more incentives for
overseas Vietnamese businesses and investors with projects in their native
land.
Along with efforts to boost exports, the decision plans to curb hard
currency spending by issuing high import tariff rates on raw materials
already available in Vietnam such as cotton, tobacco, soybeans, and hides.
Importation of consumer goods, automobiles and motorcycle parts will also
be put under strict control to minimize import volume. Importation will be
encouraged only with regard to production materials, equipment and
advanced technology that help speed up national modernization. The use of
raw materials locally available will be increased.
Vietnam recorded an export revenue of $13.8 billion in the past 11 months
while its import value was estimated at $14.52 billion, resulting in a trade
deficit of $720 million.
Asia Times - December 22, 2001.
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