June 2024 macroeconomic report of MB Securities (MBS) has just been released, showing that export turnover of goods in May 2024 is showing signs of recovery, estimated at 33.8 billion USD, up 5.7% compared to the previous month (+15.8% compared to the same period last year).
In May, Vietnam recorded a trade deficit of 1 billion USD, despite a sharp increase in export turnover. This deficit is mainly due to increase in import turnover of goods being larger than increase in export turnover of goods due to increase in imports of equipment, machinery and raw materials, trend of trade surplus is showing signs of slowing down.
Many enterprises have expanded their operations to meet orders from new markets established through trade agreements between Vietnam and international partners.
Key items with very high growth rates contributing to volume of exported goods include: Other base metals and products (+111.6% over the same period last year), rice (+56.4%) and textile fibers and yarns of all kinds (+52.7%).
Accumulated exports in the first 5 months were estimated at 156.7 billion USD (+15.2%). Items with largest negative growth included toys, sports equipment and parts (-13.9%), clinker and cement (-9.1%), paper and paper products (-2.1%).
However, exports still recorded impressive growth due to items such as cameras, camcorders and components (+61.1%), coffee (+43.9%), and furniture products made from materials other than wood (+34.2%).
Regarding export market in the first 5 months of 2024, the United States is Vietnam's largest market with an estimated import-export turnover of 44 billion USD (+2%), exports to EU are estimated at 20.7 billion USD (+16.1%); exports to Japan are estimated at 9.4 billion USD (+4.7%).
In addition, import turnover of goods in May 2024 is estimated at 33.8 billion USD (+29.9%), up 12.8% over the previous month. Cumulative import turnover in the first 5 months is estimated at 148.7 billion USD (+18.2%). Of which, China is Vietnam's largest import market with an estimated turnover of 54.9 billion USD (+33.1%).
As of May 2024, there were 4 imported items with a value of over 5 billion USD (accounting for 47% of total turnover) including electronics, computer components (+27.3%), machinery, equipment, other spare parts (+15.4%), fabrics (+13.3%) and iron and steel (+28.3%).
MBS also forecasts that exports will grow by 10% - 12% in 2024, with a trade surplus of 21 - 24 billion USD.
The reason given is that first, according to April report of the WTO, global trade is forecast to grow by 3.3% in 2024 as inflationary pressures are expected to ease this year, allowing real incomes to rise again - especially in advanced economies - thereby boosting consumption of manufactured goods.
Second, positive signals from foreign direct investment (FDI) in Vietnam are expected to play an important role in trade activities, along with reforms in trade and customs policies that have helped improve efficiency of import-export management, simplify administrative procedures, and reduce costs and time for businesses.
However, there are still notable challenges to Vietnam's export growth in 2024, including: Prolonged disruptions and sudden increases in transportation costs due to escalating geopolitical conflicts; increased competition from rival exporting countries such as China, Indonesia, Thailand, etc.
In addition, economic recovery of Vietnam's partner countries has been slower than initially expected because the US Federal Reserve (Fed) has maintained high interest rates longer than expected. Vietnam's economy is highly open, so it is greatly affected by international developments, leading to difficulties for industries with large export turnover such as: textiles, wood, electronics.

Source: Vitic/ congthuong.vn