The Ministry of Industry and Trade (MOIT) reported that in January-September, total export turnover reached VND282.3 billion, up by 17.2 percent year on year. Of this, export turnover of the manufacturing and processing industry increased by 17.4 percent, while farm and seafood production increased by 15.6 percent and fuel and minerals by 44.9 percent.
As many as 32 product items had export turnover of over $1 billion (there were 30 product items last year). The growth was seen mostly in products that Vietnam has advantages in, such as textiles and garments (+ 24 percent) and footwear (+ 36 percent).
The ministry predicted that the export growth rate of 2022 would be 8 percent higher than targeted.
However, there have been signs of export growth slowdown since early September.
The goods export turnover in September was $28.8 billion, down by 7.3 percent from August. Associations said orders would decrease from large markets in the last months of the year.
Vitas Chairman Vu Duc Giang said after export turnover increased in H1, the export markets began decreasing in Q3.
Analysts say they can see signs of a decrease in global total demand in Q4, especially in the US and EU. The high inflation has prompted people to tighten their purse strings.
Textile and garment export turnover in the first nine months of the year was impressively high at $35 billion ($3.8-3.9 billion worth of products was gained each month), up by 21 percent compared to the same period last year.
However, analysts predict that only $3.1-3.2 billion worth of products will be exported in the last three months of the year.
From now to the end of the year, the textile and garment industry will face difficulties, including a decrease in the number of orders and unit prices.
Vietcombank Securities reported that Vietnam’s textiles and garments are under price pressure.
The US has increased imports from countries which offer lower prices than Vietnam. The target of $43 billion worth of textile and garment export turnover in 2022 is not feasible.
The Vietnam Leather, Footwear and Handbag Association (Lefaso) said its member companies are meeting challenges and their inventories are high at 40 percent.
There were fewer new orders from August 2022 to Q1 2023. The EU and US, the key markets for Vietnam’s footwear exports, have reduced their demand, which will affect purchasing power in the year-end sale season.
As for the woodwork industry, the situation is even worse. The number of orders began decreasing in July.
According to Nguyen Chanh Phuong, deputy chair of the HCM City Fine Arts and Woodworking Association, the decrease is due to the sharp increase in input material prices and transportation costs.
Meanwhile, demand has dropped sharply in the US and EU because of high inflation. Consumers there are only spending money on essentials and cutting spending on wooden furniture.
The Vietnam Association of Seafood Exporters and Producers (VASEP) reported that seafood export turnover in September was just $850 million. After seven months of a high growth rate, export turnover dropped to below $900 million.
The IMF has lowered its predicted global gross domestic product (GDP) growth rate to 2.7 percent. This is the fourth time the figure has been lowered this year.
The International Monetary Fund (IMF) and World Bank (WB) have warned about the risk of global recession. Some economies have raised interest rates, while growth has begun slowing down.
The IMF thinks that difficulties will cause one/third of the economies globally to face negative growth in at least two quarters of this year and next year.
The US is the largest export market of Vietnam with export revenue of US$86.3 billion in January-September 2022, followed by China with $40 billion and the EU with $35.7 billion.
In the world, the inflation rates are high in many countries, approximately 10 percent. Therefore, the inventory is relatively high. Meanwhile, China keeps imposing the ‘zero Covid’ policy. These all pose high challenges for Vietnam.