Import and export revenue of goods expected to set new record in 2021

After the record milestone of US$500 billion in 2019, the import and export revenue of goods is anticipated to reach US$640 - US$645 billion in 2021, setting a new record. This is a remarkable achievement amid the current difficulties caused by the COVID-19 pandemic.

Export expanding despite difficulties

Vietnamese ST25 rice, one of the rice varieties favoured by the world market in recent years, posted an export volume of more than 3,100 tonnes, valued at US$3 million, in the first nine months of this year, a 10-fold increase compared to the same period last year.

The US is currently a large consumption market of ST25 rice, accounting for 91% of Vietnam’s total export volume of ST25 (about 2,800 tonnes), up 843% over the same period last year.

Notably, ST25 rice was only exported to the US and Macau (China) in 2020, but so far this year it has been shipped to 11 markets around the world with prices ranging from US$870 to US$1,378 per tonne.

Relatively positive rice exports in the first months of the year have helped rice maintain its position as one of the commodities with a stable export turnover in the context of the complicated developments of the COVID-19 pandemic.

According to statistics from the Ministry of Industry and Trade, commodity exports showed signs of recovery in October with export turnover estimated at US$27.3 billion, up 1% compared to the previous month (September export turnover decreased by 0.8% compared to August). In the 10-month period, total export turnover was estimated at US$267.93 billion, up 16.6% over the same period last year.

Another notable positive signal in the export of goods is that new-generation free trade agreements (FTAs) such as the CPTPP and EVFTA have been utilised effectively by enterprises. Deputy Director of the Import-Export Department (Ministry of Industry and Trade) Tran Thanh Hai said that after three years of implementing the CPTPP and more than a year implementing the EVFTA, the influence of these agreements is obvious, including growing export turnover, particularly in markets Vietnam has never signed an FTA with.

“The CPTPP has helped expand exports to Canada, Mexico and Peru, from 25% to 30%. Regarding the EVFTA, the taking advantage of incentives through the issuance of certificates of origin (C/O) of EUR1 form is approximately 20%, a very significant rate,” Hai noted.

For example, export turnover of footwear reached US$14.06 billion in the first 10 months of this year, a 3.9% year on year increase. Footwear is on the list of export products that have seen positive changes thanks to the EVFTA and leather footwear is one of the items granted the largest number of C/O of EUR1 form.

In addition, as the pandemic has been gradually brought under control, the import and export activities of many localities have been able to prosper. In the first 10 months of 2021, the total import and export turnover of Ho Chi Minh City soared by 8.4% over the same period last year.

Reaching a new record

According to Tran Thanh Hai, it is possible to forecast that the total import and export turnover of goods could reach from US$640 - 645 billion in the whole 2021 and the country could enjoy a trade surplus. This is a huge achievement as businesses have been heavily affected by the COVID-19 pandemic due to the Delta variant in 2021. In particular, the pandemic has repeatedly hit the main hubs of commodity production in the north and south.

“Overcoming difficulties, our businesses have still maintained production and recovered very quickly after the pandemic. In particular, strong industries such as textiles and garments and leather and footwear are expected to reach their export targets earlier than expected and from now until the end of the year, businesses in these industries can regain their growth rate as before the pandemic. Traditional industries such as telephones, electronics, machinery and components are also forecast to grow by an impressive rate of 15-25% in this year,” Tran Thanh Hai added.

Enterprises have gradually developed production methods to respond flexibly and promptly to the pandemic situation.

Chairman of the Board of Directors of the Hung Yen Garment Corporation Nguyen Xuan Duong said that his company has always focused on capital accumulation to stand ready to respond to crisis. Thanks to this, the company established more subsidiaries without dependence on bank loans. His company could also thereby sustain and pay wages to employees for six months, despite the closure of factories.

Nguyen Xuan Duong said that labour fluctuations in garment enterprises are fierce, so enterprises need to improve management and labour productivity, and create a good environment and income to retain employees.

Experts affirmed that high shopping demand at the end of the year will be an opportunity to boost the export of a number of products including textiles, footwear, electronics, and others. Therefore, domestic enterprises need to take advantage of opportunities in the last few months of the year to make up for the losses in exports during the pandemic and fully utilise export opportunities to major markets including the US, EU, China, the Republic of Korea, and Japan. In addition, it is important to foster negotiation activities and trade promotion to other markets with room for development.

In order to prevent a decline in exports due to the impact of the pandemic, the Ministry of Industry and Trade is focusing on solutions to strengthen and expand export markets and take the advantage of FTAs. The Ministry is also working with China to facilitate customs clearance and export of goods through the northern border gate, thereby creating optimal conditions for enterprises to complete their 2021 plan and prepare for the next year.