Vietnam trade surplus increases in Q1, despite Covid-19 crisis

30 Mar 2020

Shipments Vietnam recorded an $2.8 billion trade surplus during the January-March period of 2020, despite the ongoing coronavirus crisis. 

The Southeast Asian country recorded a higher trade surplus during the first quarter of this year, compared to last year’s $1.5 billion – despite the Covid-19 pandemic disrupting its major export markets. 

According to a monthly repot from the General Statistics Office, the domestic sector registered a $4.4 billion trade deficit, while investment in the foreign sector witnessed a trade surplus of $7.2 billion. 

Vietnam’s export turnover was forecast at $59.08 billion during Q1, up 1% from the same period last year. The export value of the domestic sector witnessed an 8.7% surge to $18.65 billion year-on-year, responsible for 31% of the country’s exports. 

Trade in the foreign investment sector gained $40.43 billion from overseas shipments, dipping 3% year-on-year and accounting for 69% of the total. 

Export turnover exceeded the $1-billion benchmark in eight groups of commodities during the period, making up 71% of the total. Phones and parts witnessed the largest export turnover at $12.4 billion, accounting for 21% of Vietnam’s total exports. 

Electronic products, computers and components came in second with $8.2 billion, climbing 16.2% on a year-on-year basis. This was followed by clothing with $6.5 billion – down 9% - equipment and parts up 18% at $4.7 billion, and footwear falling 2% at $3.9 billion. 

During the three-month period, the U.S. remained the largest importer of Vietnamese merchandise, valuing at $15.5 billion – marking an annual surge of 16.2%. This was followed by China in second place with $8.4 billion (up 12%); the European Union ($7.5 billion, down 15%), ASEAN ($6 billion, down 5.2%); Japan ($4.8 billion, up 4%) and South Korea ($4.5 billion, down 3%).

The country on the South China Sea also spent $56.26 million in three-month imports, tumbling 2% compared to the same period in 2019, said the GSO. 

Production materials were purchased for roughly $52.6 billion, down 1.2% year-on-year and in line with 93.5% of the total import value. Meanwhile, expenditure on consumer products was registered at $3.66 billion (or down 11%), comprising 6.5% of the total.

China maintained its position as the largest provider of goods gto Vietnam during the first three months of the year, recording turnover of $13.3 billion, falling 18% from the previous year. South Korea ranked second with $11.7 billion – or up 2.5%. This was followed by ASEAN in third place with $7.2 billion, down 8.3%, Japan ($4.9 billion, up 16%); the EU ($3.4 billion, up 5.2%) and the US ($3.4 billion, up 13%).

The GSO estimated that once the EU-Vietnam Free Trade Agreement (EVFTA) is implemented, Vietnam’s exports to the eurozone will rise by over 20% in 2020, and the growth will continue to escalate in the following years. 

Seafood goods are expected to benefit most from the agreement. The EU is currently the second largest importer of Vietnamese seafood products, after the United States. 

Vietnam’s farm produce exports to the European Union are also expected to climb by roughly 10% in 2020.