2024: Exports will improve

In 2023, the trade surplus will reach a record of 28 billion USD with many pure Vietnamese export items reaching billions of USD in value and growing positively such as rice, vegetables, cashew nuts, coffee, paper and paper products.

The export value of wood and wood products in 2023 will reach 13.4 billion USD. In the photo: workers at the KES Group Industrial Wood Factory, Dong Phu District, Binh Phuoc Province - Photo: HUU HANH

This is also the premise for expecting continued export success in 2024. According to data released by the General Statistics Office in the 2023 socio -economic situation report, the record trade surplus in 2023 far exceeds the trade surplus figures of many years past. The trade surplus value in 2023 reached 28 billion USD - 2.5 times the trade surplus value in 2022, 7 times the trade surplus value in 2021 and more than 1.4 times the trade surplus value in 2020.

Billion dollar export items

Import-export turnover in the past 15 years (2008 - 2023) has changed in a positive direction, the economy has gradually shifted from trade deficit to trade surplus. If from 2008 - 2011 we continuously had a trade deficit of tens of billions of USD, from 2012 - 2023 the economy has shifted to a trade surplus. From 2012 to now, only in 2015 did the economy have a trade deficit of 3.2 billion USD, in the remaining years the economy continuously had a trade surplus from several billion USD to several tens of billion USD. In the record trade surplus in 2023, in addition to the items with large export value exported by the FDI enterprise sector such as electronics, computers, components 57.3 billion USD; phones, components 53.1 billion USD; machinery, equipment, other tools 43.1 billion USD, many items produced by the domestic enterprise sector, more purely Vietnamese, also achieved large export value. Specifically, the export value of textiles and garments is 33.2 billion USD, footwear is 20.3 billion USD, wood and wood products is 13.4 billion USD, seafood is 9 billion USD. However, in 2023, there are still many difficulties, so these key export items will decrease compared to 2022. Meanwhile, some domestic export groups show remarkable positive signals in 2023: vegetables and fruits reach 5.5 billion USD (up 65.9%), cashew nuts are 3.6 billion USD (up 17.6%), coffee is 4.1 billion USD (up 3.1%), rice is 4.8 billion USD (up 39.4%), paper and paper products are 2.08 billion USD (up 9.5%)...

Workers load agricultural products onto containers before exporting to China at Tan Thanh border gate, Lang Son province - Photo: HA QUAN

World economy recovers, exports will improve

Speaking to Tuoi Tre, Associate Professor, Dr. Doan Ke Bon, Faculty of Economics and International Business, University of Commerce, said that in 2023, Vietnam's total export turnover will not be as good as every year. However, because the trade balance depends on both exports and imports, this year exports decreased but imports decreased more deeply, leading to a large trade surplus, with a record trade surplus of up to 28 billion USD. According to this expert, the trade surplus helps Vietnam stabilize the macroeconomic situation, reduce the scarcity of USD in the country, and help us regulate monetary policy more easily. However, imports for Vietnam play a role in providing raw materials, accessories, and fuel for production to serve exports. This year we cannot export, so the demand for importing raw materials, materials, and input equipment is not high. Moreover, due to economic difficulties, Vietnam's demand for imported goods is also low according to the general demand of the world . According to Mr. Ngo Sy Hoai - Vice President and General Secretary of the Vietnam Timber and Forest Products Association, export is an important driving force of the economy, but in 2023, the export of many industries with large turnover such as textiles, footwear, wood, and seafood all decreased by 15 - 30% compared to the same period in 2022. Sharing the same view, Mr. Vu Tien Loc, member of the National Assembly's Economic Committee, also affirmed that import and export in 2023 is not a very positive signal. Although the economy had a trade surplus of 28 billion USD, in 2023, the total import and export turnover decreased by 6.6% compared to 2022.

This is also the only year that import-export turnover has decreased in the past 10 years (2013 - 2023), so import-export is still difficult. The positive signal for exports in 2023, according to Mr. Loc, is that in the fourth quarter, exports increased more while imports decreased, the import growth rate was lower than the export growth rate, which caused the trade surplus to increase sharply. "In 2024, Vietnam's exports will recover along with the recovery of the world economy and can achieve better growth than in 2023," Mr. Loc predicted. Similarly, Mr. Bon also said that exports in 2024 will be better than in 2023 because inflation in the US, European countries, China, Japan, and South Korea is decreasing. These are major export markets of Vietnam. Up to now, according to the latest announcement, the US and European countries have controlled inflation, interest rates will decrease, so consumption trends will recover and gradually increase. The world economic situation, especially Vietnam's major export markets, is forecast to improve, so Vietnam's export situation will also improve this year. However, Dr. Le Quoc Phuong, former deputy director of the Center for Industry and Trade Information ( Ministry of Industry and Trade ), said that it is necessary to improve the quality of export goods because we have a large trade surplus in 2023, but it is mainly due to FDI enterprises. Specifically, the FDI sector has a trade surplus of about 48 billion USD, while the domestic enterprise sector has a trade deficit of about 20 billion USD, so the trade surplus in 2023 is mainly due to the FDI sector having a very large trade surplus, domestic enterprises still have to import a lot of trade deficit. FDI enterprises are accounting for 3/4 of the export pie, domestic enterprises only account for 1/4. Moreover, we have a trade surplus with Europe and the US but a large trade deficit with some Asian countries such as China and Korea - Mr. Phuong emphasized. Currently, Vietnam ranks 20th in the world in terms of export turnover, of which 85% of export products are in the processing and manufacturing industry such as textiles, footwear, electronics, phones, computers... but most of them are processed. It can be seen that if we look at the total export turnover, Vietnam is an export powerhouse but the added value we benefit from is very low. According to Mr. Phuong, to increase the added value of exports, we must first increase the domestic content of exported goods, to do so we must shift from the current processing and assembly production to design and manufacturing production. And to realize this, workers must be highly qualified and skilled; production must be based on its own foundation and not just on assembly, for example, we are pursuing the development of the semiconductor industry today.

Graphics: TAN DAT

Bright spot in agricultural exports

Agricultural exports are the brightest spot in the country's export picture in 2023, contributing significantly to the trade surplus of 28 billion USD, creating an export turnover value of 1 billion USD or more for more than 10 agricultural products. Agricultural exports have created four bright spots. First, the scale is constantly increasing. Second, the structure of exported goods is in a positive direction, reducing raw content and increasing processed products. Third, exports continue to be expanded, diversified, and rich in types, making good use of free trade agreements (FTAs). And finally, agricultural exports have made an important contribution to maintaining the trade surplus over the past years. To increase the value of agricultural products, a comprehensive approach, multi-sectoral coordination and inter-sectoral solutions are needed for sustainable agricultural development in the future. It is necessary to soon form strong enough groups to support, proactively respond, and create added value based on effectively exploiting scientific and technological resources, innovation, and digital transformation. Dr. Tran Huu Hiep

Textile workers working at Viet Thang Jean Company Limited, Thu Duc City, Ho Chi Minh City - Photo: QUANG DINH

Mr. Dang Phuc Nguyen (General Secretary of Vietnam Fruit and Vegetable Association):

Optimistic!

In 2024, the Ministry of Agriculture and Rural Development set a target of 4.5 billion USD in fruit and vegetable exports. But in just 11 months of 2023, fruit and vegetable exports earned 5.6 billion USD. This mark was achieved thanks to the "scoring" of durian, earning 2.4 billion USD (from 2021 onwards, only about 200 million USD/year was exported). Therefore, I fully hope that in 2024, the fruit and vegetable industry will reach 6-7 billion USD. We have reason to believe so because China spends 15 billion USD each year on fruit imports. Vietnam's market share this year is expected to account for about 25-30%, just behind Thailand and Chile. In the future, the size of the Chinese market could double, to 30 billion USD. Therefore, there is a huge opportunity for Vietnamese businesses if this market of 1.4 billion people opens its doors to more products such as frozen durian, green-skinned grapefruit, avocado, fresh coconut... from Vietnam. Mr. Nguyen Dinh Tung (General Director of Vina T&T Company, Ho Chi Minh City):

Durian wins big!

The unit's durian export volume in 2023 increased about 10 times compared to 2022, so the value also increased sharply. Accordingly, in the total export volume, China accounts for 85%, the rest are other markets such as the US, Europe, Canada... In 2023, we will truly take advantage of the protocol to officially export durian to China, thanks to which the output and overall export value of this item will increase sharply. 2024 will continue to be the year of durian, the price of this item is likely to remain at a good level because the room in the Chinese market is still very large. Meanwhile, the supply of countries such as Thailand, Vietnam, Cambodia... although increasing, cannot meet the demand of this billion-people country. Specifically, although being the main consumer market, currently only about 300 - 400 million Chinese people have access to durian. In addition, the more than 100 million people in the country are also an important market that we have not yet exploited well. Mr. Pham Xuan Hong (Chairman of the Ho Chi Minh City Textile and Garment - Embroidery Association):

Textiles will gradually recover

Textile and garment enterprises expect the market to recover in 2024 to increase exports and ensure jobs for workers. Enterprises predict that in 2024, people's demand will gradually recover, leading to growth in the textile and garment industry. However, the level of recovery still depends largely on the world market situation; some markets are still uncertain and may even reverse. Previously, enterprises could make plans a year in advance, but in this period, all plans must be shorter-term, even calculated by month. To have orders in the coming period, enterprises must continue to search for and expand new markets in addition to traditional markets and declining markets. In addition, enterprises must also be more competitive in terms of price and quality, accept small orders, low profits and diversify products, and speed up production of products that people are in demand at this time. Mr. Nguyen Van Khanh (Vice President of the Ho Chi Minh City Leather and Footwear Association):

Try to find a niche market

In 2024, Vietnamese footwear enterprises will still strive to find orders, even find niche markets, to get jobs. In particular, enterprises must have flexible strategies on prices, product quality, even in the case of break-even, enterprises will still consider doing it to operate the machine, workers have jobs. Enterprises themselves also expect the world situation to stabilize, the purchasing power of people in key markets to increase again, which will motivate enterprises in the industry to produce. Mr. Pham Van Viet (General Director of Viet Thang Jean):

Improve technology, increase quality

Enterprises must further promote technological innovation to produce high-quality, highly competitive products in the context of the current slow recovery. Once technology has been changed, enterprises will also continue to expand to new markets such as the Middle East, Africa, Russia, etc. in addition to familiar markets for the garment industry such as the EU and the US. In addition, the production of products must also be more diverse, from fashion, seasonal products to everyday wear, uniforms, and popular goods, etc. With the efforts of enterprises as well as market forecasts, it is likely that garment enterprises will recover in the second half of 2024.

Rice will grow strongly, hope for seafood

The government and businesses expect that the value of rice exports will continue to grow strongly in 2024. On the contrary, the seafood industry is facing difficulties. On the first day of the new year, Mr. Pham Thai Binh, Chairman of the Board of Directors of Trung An High-Tech Joint Stock Company (Can Tho City), looked back: 2023 is considered a successful year for Vietnam's agricultural sector when the value of agricultural exports increased greatly, exceeding expectations.

In 2023, Vietnam's rice exports will be over 7.7 million tons, with a value of more than 4.4 billion USD - Photo: BUU DAU

Rice prices continue to increase. According to Mr. Binh, in 2024, with the leadership of the commander of the Ministry of Agriculture and Rural Development and the participation of local authorities, the implementation of the project of 1 million hectares of high-quality and low-emission rice is expected to be completed. This will be a condition to help develop the rice industry further. "From the perspective of rice exporting enterprises, the implementation of the project of 1 million hectares of high-quality and low-emission rice, we really want this project to be implemented in 2024. However, there need to be solutions for businesses and farmers to access. In particular, farmers must produce low-emission rice to improve the quality and value of rice grains. Businesses are looking forward to specific solutions from the Ministry of Agriculture and Rural Development. In 2023, the Ministry managed the agricultural sector very successfully and we believe that 2024 will certainly be even more successful," Mr. Binh added. Regarding the rice export situation in 2024, Mr. Pham Thai Binh predicts with certainty that rice prices will continue to increase. However, businesses will no longer be "shocked" by the unusual increase in rice prices because they have been proactive in advance. With the implementation of many solutions to develop the rice industry, Vietnam's rice export value in 2024 will continue to increase even more. Mr. Le Huu Toan, Director of the Department of Agriculture and Rural Development of Kien Giang province, also expects the value of rice grains in the Mekong Delta to bring more results in 2024. "To achieve that, the rice industry needs to soon have a national rice brand. We really want this. I also hope that in this new year, farmers will produce in a synchronous manner from livestock to crop and aquaculture. My final expectation is that the transport infrastructure in the Mekong Delta region will be synchronously implemented. From there, it will help farmers, the agricultural sector, especially rice, of the Mekong Delta region to develop further," said Mr. Toan. Hope for shrimp and fish Talking about the difficulties of exported shrimp, Mr. Ho Quoc Luc, Chairman of the Board of Directors of Sao Ta Food Joint Stock Company, said that in 2024, the difficulties of the Vietnamese shrimp industry are expected to still be evident. However, with their experience in the market, shrimp entrepreneurs have known how to turn that challenge into experience and courage to enter the new year with less pressure and more confidence. However, the "fatal" disadvantage of the shrimp industry is that the cost of shrimp farming is too high and cannot be overcome in a short time, so it will require the efforts of the entire shrimp industry value chain to be stronger than ever in order to hope to achieve better results in the new year. Meanwhile, Mr. Tran Van Phuc, Director of the Department of Agriculture and Rural Development of Binh Dinh province, said that in 2023, Binh Dinh province's seafood exports will reach 110 million USD, about 50 million USD lower than in 2022. "Currently, Binh Dinh has six seafood processing factories with a capacity of about 17,000 tons/year. Binh Dinh's seafood exploitation output reaches 270,000 tons and 14,000 tons of farmed seafood. This is a very abundant source of raw materials for seafood export. In 2024, with the current situation, if the economy is stable, it will create conditions to expand the market for export enterprises. Binh Dinh's main seafood exports are frozen goods, especially ocean tuna. This year, the total export value of Binh Dinh's seafood is expected to reach 160 million USD and ocean tuna products are still the main product," Mr. Phuc informed. Speaking more about the difficulties, Mr. Hoang Ngoc Binh, operations director of Australis Company (an American company currently investing in aquaculture in Khanh Hoa), said that Vietnam's seafood export industry is currently facing many increasingly strict technical barriers regarding food safety and hygiene, traceability, while sustainability factors, competitiveness are not high, and deep processing has not been promoted... "To bring Vietnamese seafood products deeper into demanding markets, we need to build a chain from exploitation, processing to export and must comply with the conditions set by that market," said Mr. Binh. Mr. Vo Khac En, deputy head of the Khanh Hoa Fisheries Department, said that in 2023, inflation will cause a decrease in consumption demand in major markets and affect domestic production, causing the number of export orders of seafood enterprises to decrease and inventory to increase. The market is difficult, and domestic raw material production has also slowed down. However, the cost of raw material production is increasing along with the increase in packaging, materials, energy, labor... while Vietnamese seafood is under pressure to compete in supply and selling price with other countries. "To be able to boost seafood exports, businesses need to ensure finance to maintain stable production and be ready with raw materials when the consumption market recovers," said Mr. En.

Mr. Truong Dinh Hoe, General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), assessed that there were difficulties in the past year but still hoped that seafood would overcome them to accelerate export turnover in 2024. The seafood industry set a target of increasing by 3.7 - 4%, or about 9.5 billion USD in 2024 (9.2 billion USD in 2023). This figure is set in the context of import demand showing no signs of recovery and strong competition from markets. But to have a "sparklingly cheerful" figure for seafood in the new year, it is necessary to go deeper into the Chinese market. We must review the processing method to increase the value of key products to increase export turnover; green growth, meeting domestic market demand as well as world consumer market trends in the coming time.

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