What do we see from the trade surplus of 10 billion USD?

Trade surplus with the US is 31 billion USD

According to the General Statistics Office, in May 2023, import-export turnover was estimated at 55.86 billion USD; compared to the same period last year, it decreased by 12.3%, but compared to the previous month, it increased by 5.3%. Of which, goods export reached over 29 billion USD, up 4.3% over the previous month; the domestic economic sector reached 7.8 billion USD, up 1%; the foreign-invested sector (including crude oil) reached 21 billion USD, up 5.5%.

On the other hand, the import turnover of goods in May 2023 is estimated at nearly 27 billion USD, up 6.4% over the previous month. Of which, the domestic economic sector reached 9.3 billion USD, up 3.8%; the foreign-invested sector reached 17.5 billion USD, up 7.8%.

In the first 5 months of 2023, the total export turnover of goods is estimated at 136 billion USD, down nearly 12% over the same period last year. The total import turnover of goods is estimated at 126 billion USD, down nearly 18% over the same period last year. Compared to the same period last year, in the first 5 months of 2023, the trade surplus with the US is estimated at 31 billion USD (down 22%), the trade surplus with the EU is 12.6 billion USD (down 3.6%); the trade surplus with Japan is 521 million USD (in the same period, the trade deficit is 564 million USD). Meanwhile, the trade deficit with China is 23.6 billion USD (down 16.7%), the trade deficit with South Korea is nearly 11 billion USD (down 38%), the trade deficit with ASEAN is 3.4 billion USD (down 41%).

Thấy gì từ con số xuất siêu 10 tỉ USD? - Ảnh 1. — Rice is Vietnam's main export product.

Reviewing the Government's economic report, the National Assembly's Economic Committee also noted: A large trade surplus in the context of economic difficulties and declining exports is worth noting. This shows a decline in growth momentum. According to experts, since the end of 2022, imports and exports have begun to decrease due to the general context of the world economy and reduced consumption demand on a global scale. These factors will continue to affect Vietnam's trade balance in the first months of 2023.

With a highly open economy like Vietnam and exports largely relying on imported raw materials, the trade surplus in this context needs to be carefully considered, because the increase in trade surplus is due to a sharper decrease in imports than exports. However, the figures on import-export turnover in May increased in both export and import directions, giving us hope for signs of a recovery in production and business.

Not stable, but good news

Economist, Dr. Ngo Tri Long commented: Vietnam has 28 imported goods with negative growth. Of which, the goods with the largest decrease are phones and components, down 64%; followed by rubber, down 43%; wood and wood products, down 36%... These are goods that account for a large import turnover, so the reduction in raw material imports also contributes to the trade surplus of nearly 10 billion USD. Looking at the statistics, it can be seen that net exports have grown quite large, although compared to the same period, it is not equal. However, in the context of the world economy in recession, many instabilities exist, many key export industries of Vietnam are declining, lacking orders, but Vietnam's trade surplus is positive, so it can be said to be positive. The three growth drivers of the economy include consumption, export and investment, one of which is the net export turnover recording a positive number, which is commendable and encouraging.

In the general context of many difficulties, we should not be too optimistic but must actively strive to find orders and expand the market.

Associate Professor, Dr. Dinh Trong Thinh (Academy of Finance)

Sharing the same view, Associate Professor, Dr. Dinh Trong Thinh (Academy of Finance) analyzed: The import-export situation has decreased sharply due to the lack of orders in the past half year, especially the import turnover has decreased more sharply than the export, causing the trade surplus to continuously increase in the past time. That is the reason why many people are worried that if this situation continues, it will be very dangerous for the economy, because it means that production and business activities are stagnant. However, in April and May, there were signs of growth compared to the previous month. "But in fact, according to my observations, orders have returned but they are mainly small and moderate; there is a lack of large orders and stable quantities in the long term. Therefore, in the general context, there are still many difficulties, requiring us not to be too optimistic but to actively strive to find orders and expand the market," said Mr. Thinh.

Economist, Dr. Le Dang Doanh, commented that in the first few months of the year, the sharp decline in both import and export turnover is worrying for everyone. However, that is the general context of the global economy. The fact that we are still maintaining a high trade surplus, contributing to stabilizing the balance of payments and the macro economy, is the effort of the business community in finding orders and expanding markets from the free trade agreements (FTAs) that we have signed with partners.

Efforts to exploit new markets

Citing the story of the textile and garment industry, Associate Professor Dr. Dinh Trong Thinh raised the question: In the context of our fashion industry such as textiles, footwear and leather, there is a lack of orders, while Bangladesh is "overworked". So the difficulty of the market is only a part, the rest is because we have not had time to adapt to new trends of development. Therefore, we must review all traditional markets, see how the demand changes to avoid losing more orders. Besides, we need to make efforts to find customers in new markets, especially in places where we have FTAs.

Dr. Le Dang Doanh also believes that the real strength of Vietnam, especially domestic enterprises, is in the fields of food, foodstuffs, wood, etc., so it is necessary to promote the export of these products, especially in new markets. In addition, it is necessary to invest in processing and deep processing. For the processing and manufacturing industry, the state needs to create more favorable and open conditions for Vietnamese enterprises to participate deeply in production chains, creating real added value for electronic products, phones, computers, etc. For example, Samsung is the largest investor in Vietnam today. According to this enterprise, 55% of the added value of goods is created in Vietnam. However, research by Fulbright University shows that this number is much lower and only in very simple stages in that value chain such as wages, packaging, printing. That difference falls into the pockets of small and medium-sized Korean enterprises that follow Samsung into Vietnam. It is necessary to create conditions for Vietnamese enterprises to participate more deeply in those production value chains.

Dr. Tran Huu Hiep (FPT University) shared that in such a difficult context, it is a good thing that we still have a trade surplus. Therefore, we need to continue promoting domestic production towards self-sufficiency in raw material supply. Strengthen the domestic market, promote sustainable exports, remove barriers, and facilitate domestic consumption.

It is necessary to promote administrative reform, remove bottlenecks, barriers, and obstacles that hinder production and business activities. Actively and more quickly support digital transformation for businesses in all fields. Build a practical and effective digital economy and digital society, creating maximum favorable conditions for businesses.

Dr. Tran Huu Hiep (FPT University)

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