In the first 8 months of the year, Vietnam had a trade surplus of 16.255 billion USD, mixed joy and worry

From the beginning of the year to August 15, Vietnam had a trade surplus of 16.255 billion USD. Analyzing this figure carefully, we can see both happy and worried points.

Xuất khẩu ngày Việt Nam lọt top 30 nền kinh tế xuất nhập khẩu hàng hóa lớn nhất

From the beginning of the year to August 15, Vietnam had a trade surplus of 16.255 billion USD. (Source: Industry and Trade Newspaper)

Impressive results

Our country's trade balance from the beginning of the year to August 15 was a trade surplus, a very encouraging result.

Specifically, the trade surplus from the beginning of the year to August 15 was very large, at 16.255 billion USD, the highest compared to the same period ever. In the same period in 2022, the country's trade surplus only reached 1.028 billion USD.

Trade surplus has been achieved in all months since the beginning of 2023, averaging 2.792 billion USD/month. This is a rare outstanding point.

In recent months, Vietnam has had a trade surplus in 55/86 markets. Of these, there are 34 large export markets (over 100 million USD), especially 16 markets with very large trade surpluses (over 1 billion USD) such as the US, the Netherlands, Hong Kong (China), the UK, Canada, Germany, etc.

In particular, the trade surplus has contributed to the economic growth rate (GDP). The report for the first 6 months of 2023 of the General Statistics Office shows that the trade surplus of goods and services contributed 63.45% to the country's GDP growth rate of 3.72%. Meanwhile, asset accumulation contributed 6.28%, final consumption contributed 30.2% (because the growth rate of asset accumulation and final consumption was lower than the GDP growth rate (ie weak domestic "demand")).

This is very encouraging, because it not only shows Vietnam's position in foreign trade relations in recent times, but is also a positive signal for Vietnam to have its 8th consecutive year of trade surplus. Thereby, contributing to stabilizing the macro economy, improving the overall balance of payments, increasing foreign exchange reserves, not increasing foreign debt/GDP and stabilizing the exchange rate.

Hidden worries

Besides the positive points, the large trade surplus in recent months also has some worrying points.

First of all , regarding the trade surplus, if calculated in terms of value, from the beginning of the year to August 15, the trade surplus was 16.255 billion USD, but in terms of quantity, the trade surplus according to calculation is only about 8 billion USD.

Second , regarding the origin of trade surplus, normally, trade surplus must be due to increased exports, but since the beginning of the year, our country's exports have decreased by 10.1% (down 23.50 billion USD), while imports have decreased more deeply (down 16.3%, equivalent to a decrease of 38.73 billion USD).

Export reduction due to shrinking foreign demand negatively affects GDP growth, negatively affects labor and employment issues, causing many workers to become unemployed...

The decrease in imports is primarily due to weak domestic demand (including asset accumulation, investment and final consumption). At the same time, the decrease in imports will have many impacts on domestic production and consumption.

Third , the trade surplus comes from the foreign direct investment (FDI) sector, while the domestic economic sector is running a large trade deficit.

Specifically, the FDI sector's exports reached 154.508 billion USD, down 10.2% over the same period in 2022; imports reached 124.511 billion USD, down 17.2% - a deeper decrease than the export decline. This sector's trade surplus means profits, and a large part of these profits come from cheap domestic labor.

Meanwhile, the domestic economic sector's exports reached 54.923 billion USD, down 9.9% over the same period in 2022; imports reached 68.665 billion USD, down 15.2%. Thus, this sector had a trade deficit of 13.742 billion USD.

Fourthly , besides the markets where Vietnam has a trade surplus, there are also many markets where Vietnam has a large trade deficit in recent months. Of these, there are 9 markets where Vietnam has a very large trade deficit (over 1 billion USD), including: China (27.81 billion USD), South Korea (15.25 billion USD), Taiwan (China), Kawait, Thailand, Australia....

Thus, trade surplus is good news, but it is "happy first, worried later", or "happy for a short time, worried for a long time", "both happy and worried"...

The task for businesses and industries is to prevent the decline in exports, while also taking advantage of opportunities to import, especially when import prices are still low, to have raw materials for production, in order to achieve growth targets.

Source