Amidst challenging export conditions and declining orders, it is essential to continue diversifying and opening new export markets, while focusing on building product branding to sustain Vietnam’s export performance and position in the global market.
Export Performance in 2023:
According to data from the Ministry of Industry and Trade, Vietnam’s export turnover in the first six months of 2023 is estimated at $164.45 billion, witnessing a 12.1% decline compared to the same period last year. Notably, exports to major markets have also decreased compared to the previous year.
For instance, exports to the United States decreased by 22.6%, the EU by 10.1%, China by 2.2%, South Korea by 10.2%, Japan by 3.3%, and ASEAN by 8.7%. Furthermore, most key export items also experienced substantial declines.
For example, the textile and garment industry decreased by 15.3%, footwear by 15.2%, phones and electronic components by 17.9%, wood and wood products by 28.8%, and fertilizers by 45.6%.
Reasons for the Decline:
The decline in export performance can be attributed to several factors. Persistently high inflation, a conservative monetary policy, slow global economic recovery, and the collapse of some world banks have impacted consumer spending and demand for various goods, especially in major consumer markets such as the US and EU, leading to reduced import demand.
Moreover, industrial enterprises, particularly those involved in exports, have encountered difficulties in expanding and diversifying their markets due to high input costs of raw materials, production, logistics, and lingering high-interest rates.
Furthermore, the tightening monetary policies of major export markets have negatively affected Vietnam’s export prices, and increasing competition from China, which has recently reopened its market, has further compounded the challenges. Some businesses have been forced to cut labor due to reduced export orders.
Forecast for Export Outlook in Late 2023:
Deputy Minister of Industry and Trade, Do Thang Hai, believes that the challenges will persist. The global economy is currently experiencing heightened uncertainty and instability, impacting Vietnam’s macroeconomic stability and growth prospects, especially given the country’s significant dependence on diversified export markets through Free Trade Agreements (FTAs).
Additionally, the global economy is entering a new phase with various risks and challenges. The risk of economic recession, inflation, and high-interest rates continues, leading to a sharp decline in consumer demand in countries worldwide, especially in Europe and America, which are major trading partners of Vietnam.
Furthermore, multinational corporations are adopting strategies to shift their supply chains and production closer to consumer markets and diversify their production supply chains, rather than concentrating production plants in specific countries like China and Vietnam.
Multinational corporations are increasingly investing in production plants in countries such as India, Mexico, Brazil, posing more competition in Vietnam’s major export markets and directly affecting Vietnam’s market share in these markets.
Conclusion:
To maintain Vietnam’s export achievement in the face of challenges, it is crucial to address inflation, implement a more flexible monetary policy, and find innovative ways to attract foreign investments and technological advancements. Simultaneously, efforts should be made to promote product branding, diversify export markets, and adapt to changing global supply chain dynamics. These measures will enable Vietnam to navigate through economic uncertainties and solidify its position as a competitive player in the global export market.