Strong export growth but many challenges remain

Loading and unloading containers at Cái Mép – Thị Vải Port, Bà Rịa – Vũng Tàu Province. — VNA/VNS Photo Hồng Đạt

Compiled by Hoàng Hà

Although gaining strong growth in export turnover in the first seven months of this year, Việt Nam still faces many challenges to maintain the high growth in the export until this year end.

With the gradual recovery of the world market and increase of export orders, trade activities in the first seven months achieved positive results.

The total trade turnover in July exceeded US$70 billion for the first time, of which exports reached a record of over $36 billion, marking the month with the highest export value ever.

In the first seven months, export turnover reached $266.9 billion, up 15.7 per cent over the same period last year. Import turnover stood at $212.9 billion, up 18.5 per cent.

During those months, there were 10 import items with a value exceeding $5 billion, including electronics, computers and components, common metals, phones and components, machinery, equipment, tools and spare parts.

According to the forecast of MB Securities Joint Stock Company (MBS), exports will grow by 11 per cent – 12 per cent in 2024, with a trade surplus of $12-14 billion.

This growth is based on the World Bank’s forecasts on the global trade in goods and services increasing by 2.5 per cent in 2024 and 3.4 per cent in 2025. Positive signs of FDI in Việt Nam are expected to play an important role in trade activities.

In addition, recent reforms in trade and customs policies have improved the efficiency of import-export management, simplified administrative processes and reduced costs and time for businesses.

PetroVietnam Securities Incorporated (PSI) also noted that consumer confidence is showing signs of recovery. The consumer confidence index on economic conditions in key markets, such as the EU and UK, also recorded slight recovery,

In addition, the number of new orders from the US, Việt Nam’s key export market, increased, showing more optimism about this market’s demand in the future.

Therefore, PSI expects purchasing power in major export markets to recover more strongly in the second half of 2024.

Although the US has not recognised Việt Nam as a market economy, PSI still maintains a positive view on Việt Nam’s export enterprises this year because the US is still Việt Nam’s largest export market, reported the Doanh nghiệp Việt Nam (Việt Nam businesses) magazine.

Many challenges

However, MBS believes that Việt Nam’s export growth until this year end will face many challenges, such as a spike in shipping costs due to geopolitical conflicts; and increasing competition from rival exporting countries such as China, Indonesia and Thailand.

Other challenges are negative impacts from the US’s prolonged high interest rates on Việt Nam’s partner countries, leading to a decline in market demand.

Moreover, Việt Nam’s economy is highly open, so it also is greatly exposed to global economic developments. This brings difficulties for industries with large export turnover such as textiles, wood and electronics.

TAL Vĩnh Phúc Apparel Co exports millions of clothing items annually. — VNA/VNS Photo Trần Việt

According to the Ministry of Industry and Trade (MoIT), although the export market has seen signs of recovery, the export recovery of products is still uneven and unstable.

Việt Nam’s key export products to such major markets as the EU and the US are facing pressures from trade defence investigations, origin fraud and technical barriers related to the environment, sustainable development and green transformation.

The world economic situation still faces many difficulties and challenges, while the slow recovery of global trade, consumption and investment has affected the domestic economy.

Industrial enterprises, especially export ones, continue to face difficulties in expanding and diversifying markets due to high input material costs and compliance costs, especially with new regulations and standards. Lending interest rates are gradually decreasing, but they are still at a high level.

Therefore, the General Statistics Office recommends synchronously and effectively implementing some groups of solutions. Of which, it is necessary to continue to popularise incentives in free trade agreements (FTAs) and maximise market opening opportunities, boost exports and improve the efficiency of exporting Vietnamese goods to markets that have signed FTAs with Việt Nam.

The country should continue to innovate trade promotion activities, focusing on digital transformation programmes in the trade promotion activities and connecting supply and demand both home and abroad.

At the same time, it is necessary to improve efficiency in customs clearance for import and export goods at border gates between Việt Nam and other countries and promote transition to official exports.

Trade surplus growth in 2025

The industry and trade sector strives to maintain a trade surplus of US$15 billion in 2025 and gain a growth of 6 per cent in export revenue turnover compared to 2024.

To reach this goal, the MoIT will continue to promote breakthrough strategies and restructure sectors and fields to improve productivity, quality, efficiency and competitiveness.

The ministry will also focus on institutional reform and development of a favourable business environment to support enterprises in restoring production and business, and implementing important projects.

Organic agricultural products from Kim Thông Cooperative, Phú Xuyên District, Hà Nội, are geared towards sustainable export. — VNA/VNS Photo Trần Việt

At the same time, negotiation about new FTAs and upgrading of existing ones will be carried out selectively to take full incentives from signed FTAs, aiming at expanding import and export markets and diversifying partners and goods suppliers and minimising dependence on certain markets.

The ministry will also implement preventive measures, improve trade defense capacity and early warning and resolve international trade and investment disputes to protect the legitimate rights of domestic manufacturing industries as well as businesses and people.

It will strongly develop the domestic market and Vietnamese brands, and promote e-commerce.

In addition, trade promotion conferences with Việt Nam trade offices abroad will be held regularly with updates on foreign markets and new regulations and standards, making recommendations to localities, business associations and businesses to adjust production plans and find suitable orders.

In particular, the ministry will accelerate the negotiation of the Comprehensive Economic Partnership Agreement (CEPA) between Việt Nam and the United Arab Emirates (UAE), and deploy various trade promotion programmes in both direct and online forms, to take all opportunities from the implemented FTAs. — VNS