Hà Nội gains positive economic growth and recovery

Manufacturing wires at MBT Electrical Equipment Joint Stock Company in Sóng Cùng Industrial Zone in Đan Phựợng District of Hà Nội. VNS Photo Tố Như

By Tố Như

HÀ NỘI – The economy of Hà Nội has maintained positive growth and recovery this year, despite the many difficulties and challenges in the political and economic situation in the world and the country.

According to the Hà Nội Department of Statistics, the Index of Industrial Production (IIP) in November was estimated to increase by 0.3 per cent over the previous month and by 4.6 per cent over the same period in 2022.

Overall, in 11 months this year, the IIP rose by 2.9 per cent over the same period in 2022, of which the processing and manufacturing industry increased by 2.4 per cent and electricity production and distribution by 7 per cent.

Several processing and manufacturing industries saw a significant increase in the IIP compared to the same period last year, with beverage production rising by 17.7 per cent, repair and maintenance of machinery and equipment 16.9 per cent, production of drugs, pharmaceutical chemicals and medicinal materials 11.3 per cent, cigarette production 9.5 per cent, wood processing and products 7 per cent, food processing and production 6.9 per cent, and furniture production 6.4 per cent.

Meanwhile, some industries decreased in IIP, including manufacturing machinery and equipment, apparel production, leather and related products, metal, electrical equipment, and electronic and computer production.

Domestic production increased, but export turnover decreased.

In November, the export turnover was estimated to reach US$1.46 billion, increasing by 4 per cent against previous months but dropping by 4,3% compared to last year.

For 11 months this year, merchandise export turnover is about US$15.2 billion, down 2 per cent from the same period last year.

The city has attracted $49.7 million and $2.65 billion of foreign direct investment in November and 11 months, respectively.

The Hà Nội Department of Industry and Trade said that due to the decline in global trade, essential export industrial products suffered a lack of orders.

In addition to the export market, the purchasing power of the domestic demand has also decreased, affecting enterprises’ production capacity. At the same time, input costs have increased, so industrial production activities from the beginning of 2023 until now have faced many difficulties and challenges.

Nguyễn Văn Thuận, an official of the Hà Nội Industrial and Export Processing Zone Management Board, said that from the beginning of the year, as the global supply chain continues to weaken, the decrease in demand for consumer goods has directly affected several businesses in industrial zones.

“As the number of orders dropped or there were no orders, production and business activities decreased by about 30 to 50 per cent compared to last year,” Thuận said.

“The decline in manufacturing activity has caused many businesses to cut working hours or jobs,” he said.

To support businesses, the city has started construction on 19 out of 43 industrial zones that were approved by the Government in the 2018 – 2020 period.

The zones will help attract further domestic and foreign enterprises to invest in production and business development.

The city also organises activities to connect businesses participating in domestic and international production, business and supply chains.

Besides, the city has provided information about Free Trade Agreements (FTA) and Chinese border gates for businesses to understand and prepare for import and export activities.

International events such as the Industry Fair, Industrial, Machinery, Equipment and Automation Products Fair, and Energy and Environment Fair (ENTECH 2023) were organised for businesses to connect with investors and customers to expand markets and enhance transfer technology.

Since earlier this year, the department, in co-ordination with relevant sectors and departments has implemented tasks and solutions to promote industrial development focusing on key industries in the city.

So far, the city has a total 196 key industrial products by 132 businesses in the industries of mechanical and manufacturing, power electronics, information technology, textiles, footwear, agricultural and food processing, chemical, rubber, plastic, pharmaceutical, construction materials and handicrafts.

To enhance industrial production growth of the last month this year, the municipal People’s Committee has asked the department to guide relevant sectors and agencies to synchronously carry out measures and solutions as well as closely watch developments in the world economy, and grasp market information to support associations and businesses to exploit and promote traditional and potential markets.

The department further helps businesses to seek foreign partners, orders and markets via international workshops, fairs and exhibitions, as well as strengthen the campaign “Vietnamese people prioritise using Vietnamese products” and trade promotion of e-commerce platform, especially trans-border ones.

Departments and agencies have been asked to simplify administrative procedures to create favourable conditions for businesses to access preferential credit sources, and offer measures to solve issues relating to VAT refund, tax, and fee and land rent reduction and exemption to promote production and trade.

Trần Thị Phương Lan, acting director of the Hà Nội Department of Industry and Trade, said that the city will continue to support businesses in reforming and improving production capacity to increase the localisation rate of products.

Businesses need to proactively grasp and propose policies and invest in advanced technology and techniques to meet the requirements for deep participation in the global production chain, said Lan. VNS