In 2024, it is forecast that Vietnam’s import and export will increase by 5.5 – 11% and 7.5% – 15%, respectively;The trade balance surplus narrows compared to 2023, at 18.7 – 24.6 billion USD…
In the 5 years 2018 – 2022, Vietnam’s average import-export growth rate is 11.62% over the same period and imports are up 11.27%. Even during the domestic and international shock period of Covid – 19 (2020 period), import and export declined but still grew positively.
However, by 2023, the world’s mainstream monetary policy is leaning towards tightening, led by the United States, causing demand for world goods in general, or more specifically, the main export markets of the United States. Vietnam like the United States accounts for ~29.46% of export turnover in 2022, China accounts for ~15.54% of export turnover in 2022 and Europe accounts for ~12.61% of export turnover in 2022 declines, leading to Vietnam’s export growth to these markets to weaken, even to negative growth.
In the first 10 months of 2023, Vietnam’s exports reached 291 billion USD, down 6.92%, imports reached 266.67 billion USD, down 12.09% over the same period. Import-export growth is showing more positive developments towards the end of the year, the negative growth momentum is gradually narrowing, however the trade balance is increasing.
This situation is because Vietnam tends to import machinery and input materials to produce and export finished products. In the context that demand in export markets is still weak, export enterprises in Vietnam have no incentive to import for additional production.
S&P Global’s report on Vietnam’s manufacturing PMI index in October 2023 also clearly pointed out that the number of new orders increased at a weak level, businesses tend to use inventory to meet orders. new instead of increasing output. As a result, the trade balance in the first 10 months of 2023 has a surplus of 24.61 billion USD, an increase of 156.65%.
In 2023, in the context of slow growth in major economies, BSC forecasts that Vietnam’s export and import will decrease by 10% – 4.42% and 15% – 9.09%, respectively; trade balance surplus at 28.6 – 29.1 billion USD.
In 2024, it is forecast that Vietnam’s import and export will increase by 5.5 – 11% and 7.5% – 15%, respectively; The trade balance surplus narrows compared to 2023, at 18.7 – 24.6 billion USD.
According to BSC, exports to the United States will recover when the Fed begins to loosen monetary policy; Warehouse goods in the United States have tended to grow slowly in recent months; Vietnam has upgraded its relationship to a comprehensive strategic partnership with the United States. However, the Fed signaled that it will keep interest rates high for a long time, which is a factor hindering the recovery.
In Europe, inflation is still high, the European Central Bank ECB also has the same view as the Fed, which is to keep interest rates at a high level for a long time until inflation reaches the target threshold of 2%. The ECB forecasts that by 2025, the average annual inflation will be 2.1%. In addition, Europe is also facing the risk of a technical recession (negative GDP growth for two consecutive quarters) when GDP growth in the third quarter of 2023 – 0.1% compared to the previous quarter. Exports to Europe in the near future will also be affected.
In China, all three main pillars of the economy, Domestic Consumption, Real Estate, and Import-Export, are weak. Next year, when the Fed ends its tightening monetary policy, it will push other countries to loosen their monetary policy accordingly, creating conditions for global trade to recover. At that time, trade between Vietnam and China will recover following the general recovery momentum. Imports of input goods in 2024 will grow stronger after stagnating in 2023, to meet the recovery in output demand
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