Sun. Apr 14th, 2024

Vietnam’s trade deficit in May increased to a record 1.2 billion USD,
raising the total trade deficit figure in the first five months of this
year to 1.9 billion USD.

It is the third consecutive
month the country has seen its trade deficit increase, up from 545
million USD in March and 936 million USD in April.

According to a report released by the Ministry of Planning and
Investment at the Government’s regular meeting in May, Vietnam
mainly imported materials serving the sectors of promising growth such
as plastics, machinery and equipment, garments and textiles.

Domestic enterprises, which experienced a trade deficit of 6 billion
USD, contributed significantly to the figure. While the foreign direct
investment (FDI) sector had a trade surplus of over 4 billion USD during
the January-May period.

The Dau tu (Investment) newspaper said the figures do not indicate a recovery in domestic production.

The economic turmoil is blamed as it has hindered the establishment of
new enterprises and pushed a large number of others into bankruptcy,
disrupted business operations or caused losses, upsetting production
earmarked for export.

Agro-forestry and fishery
export turnover in the first five months of this year is equal to 91.5
percent of the sectors’ exports for the same period last year.

A range of difficulties lie ahead for the sector, such as the US
Department of Commerce (DoC)’s decision to increase anti-dumping duties
on tra fish imported from Vietnam from 25 to 70 times higher than the
previous tax.

Mexico has also stopped importing shrimp from China, Malaysia, Thailand and Vietnam.

In early May this year, the Philippines imposed a groundless ban on
the import of shrimp and other crustaceans from Asian countries,
including Vietnam .

Vietnamese shrimp will
be tested for Ethoxyquin by the Republic of Korea, which up
until December 31 last year was one of the biggest importers of
Vietnamese shrimp in Asia .

At the same
time, foreign enterprises are buying the majority of domestic materials,
causing more difficulties for their local partners.

According to the Ministry of Agriculture and Development, foreign
enterprises have taken up to 50-60 percent of Vietnam’s coffee
volume.

Eight foreign companies purchase coffee in
the Central Highlands province of Dak Lak while in Gia Lai
province Louis Dreyfus Commodities alone was responsible for 40 percent
of the locality’s coffee export revenue last year.

The
Vietnam Pepper Association said that in 2012, foreign businesses
operating in Vietnam contributed 36.6 percent of the country’s
pepper export turnover, up 11.6 percent against last year.

Prompt solutions are required to curb the country’s trade deficit, which is expected to hit 10 billion USD this year.-VNA

By vivian