According to the General Statistics Office, in the first quarter of 2020, Vietnam’s export reached 59.08 billion USD, up by 0.5%; import reached 56.26 billion USD, down 1.9%. Trade surplus in the first quarter of this year reached US $ 2.8 billion (the same period last year had a trade surplus of US $ 1.5 billion). In particular, the domestic economic sector had a trade deficit of US $ 4.4 billion; FDI sector (including crude oil) saw a surplus of 7.2 billion USD.
Trade expert Pham Tat Thang assessed that, although the export growth rate of the first quarter of this year was quite low, it was still a growth, Vietnam still had a trade surplus. This shows that the export of the last time was seriously affected by the Covid-19 epidemic, but that pace was acceptable.
But in the second quarter, the situation could be much more serious because many US and EU partners simultaneously canceled and extended orders from Vietnam due to Covid-19.
For example, the US and EU markets account for more than 50% of the export value of Samsung Electronics Vietnam products. Samsung’s global sales and output are forecast to decline due to the overall impact of the epidemic on electronics in general. Samsung Vietnam is also expected to reduce its export target to about US $ 45.5 billion in 2020 (compared to US $ 51.38 billion in 2019).
As for the timber industry, if the situation does not improve, after the next 1-2 weeks, businesses of the timber industry are expected to cut 70% of their capacity, only to maintain the rotation regime. In the next 3-4 weeks, most businesses will completely stop producing according to export orders. Some businesses producing domestic products can only produce in moderation, about 10-15% of plant capacity.
In its report to the Prime Minister on March 31 on the impact of the Covid-19 epidemic on industries, the Ministry of Industry and Trade said that fluctuations from the US and EU will directly affect the key export sectors of the country. Vietnam such as electronics, textiles, footwear, woodwork. The production capacity of these industries is far exceeding domestic consumption demand, mainly directed to foreign markets, with the highest concentration being the US and European markets.
“Difficulties in export markets will be more serious than the shortage of raw materials from China,” the Ministry of Industry and Trade said.
Meanwhile, it is difficult to redirect exports to other countries because these markets (India, Korea, Japan …) are generally difficult to offset the shortage from the US market. and Europe, meanwhile, Vietnam’s textiles and footwear may face significant competition from Chinese goods due to their very large and substantially restored production capacity.
EVFTA was approved after 10 years of waiting, now it is time to wait for the agreement to take effect to compensate for the damage caused by Covid-19.
Mr. Bui Trong Tu, Deputy Director of the Department of Trade and Services Statistics (General Statistics Office), worried that the export in the first quarter was at a very low growth rate over the same period. Recently, the Covid 19 outbreak has been booming in Europe and the United States. Most of the orders of businesses in the US and Europe are on hold. If the second quarter of the epidemic continues to boom, it will certainly affect Vietnam’s exports. Because outside of China, these are two relatively large markets of Vietnam, especially textile, footwear and seafood.
Therefore, in the coming time, when the Covid 19 epidemic is reduced in these markets, we must take advantage of the Vietnam – EU Free Trade Agreement (EVFTA).
General Director of the General Statistics Office Nguyen Bich Lam said that when EVFTA comes into effect, exports to the EU could reach a growth rate of over 20% this year and this number will continue to increase in the following years. . One of the export products with many advantages is seafood. When EVFTA comes into effect, Vietnamese seafood will compete with similar products of other countries.
“Regarding exports of agricultural, forestry and fishery products in general to the EU, in 2019 the total value of the revenue will be USD 2.6 billion, accounting for 6.4% of total export turnover to this market. Expected, in 2020, exports of this item will increase, accounting for about 10% of total exports to the EU market, “Mr. Lam said.
Trade expert Pham Tat Thang hopes that if the EU can control the Covid-19 epidemic in the second quarter to start the third and the fourth quarter, to restore production activities, EVFTA will be the wide route and door to bring goods to. EU market … If the Covid-19 epidemic was controlled in the second quarter, even though the export of the first quarter was “flat”, Vietnam could make good use of EVFTA, it could still offset the previous losses, ” “finish target” target increased by 7-8%.
In addition, China has initially controlled epidemics and is a close market for Vietnam. Therefore, Mr. Pham Tat Thang noted that it is necessary to pay attention to boosting exports to the Chinese market, especially food items, foodstuffs, fresh vegetables, etc.It can be said that this is the golden period. for Vietnam to boost exports to China.
