Industrial production recovers quickly with growth of 9.4% in eight months

The index of industrial production (IIP) in the first eight months of 2022 surged 9.4 per cent over the same period last year, according to the General Statistics Office (GSO).

The office said that industrial production in August 2022 continued the trend of rapid recovery with an increase of 2.9 per cent over the previous month and 15.6 per cent year on year due to the efforts of enterprises in expanding production to offset the period affected by the COVID-19 pandemic.

Compared to the same period last year, the IIP growth rate in August reached 16.2 per cent for the processing and manufacturing industry; 14.8 per cent for electricity production and distribution; 11 per cent for water supply, and management and treatment of garbage and wastewater; and 10.2 per cent for the mining industry.

During the eight months, the processing and manufacturing industry posted the highest IIP growth of 10.4 per cent. It was followed by electricity production and distribution (6.8 per cent), water supply industry, garbage and wastewater treatment and management (5.8 per cent) and the mining industry (4.2 per cent).

The GSO report also showed that, in the past eight months, IIP of some key industrial products increased sharply compared to the same period last year, including beer (31.2 per cent); processed seafood (20.7 per cent); phone components (19.6 per cent); automobiles (13.9 per cent); casual wear (12.7 per cent); leather shoes and sandals (12.5 per cent); and tobacco (9.6 per cent).

Meanwhile, some other products saw a decline of IIP compared to the same period last year, such as iron and crude steel (12.3 per cent); televisions (10.7 per cent); fertiliser NPK (6 per cent); fabrics made from man-made fibers (5.8 per cent); mobile phones (5.4 per cent); aquatic feed (4.9 per cent); liquefied petroleum gas (LPG) (2.4 per cent); and crude oil exploitation (1 per cent).

GSO also reported 61 out of 63 provinces and cities gained growth, while the rest of two localities had IIP reduction in the first eight months of 2022.

Of which, some localities achieved a relatively high increase in IIP due to industrial production growth in the processing and manufacturing industries; and electricity generation and distribution industry.

Meanwhile, some other localities had low manner in IIP growth rate or reduction in this index because the enterprises faced many difficulties from the impact of the pandemic.

Bắc Giang Province achieved the highest IIP of 51 per cent during the first eight months.

Some other localities also had high IIP index due to strong recovery in the processing and manufacturing industry; and electricity production and distribution, such as Lai Châu, Đắk Lắk, Sơn La, Quảng Nam, and Khánh Hòa.

Besides that, many difficulties in production and business activities made Trà Vinh and Hà Tĩnh provinces witness a reduction in IIP at 27 per cent and 15 per cent, respectively.

The number of employees working in industrial enterprises as of August 1, 2022 increased by 0.6 per cent on month and 23 per cent on year.

According to the Ministry of Industry and Trade, production in industrial centres is showing positive signs of recovery. However, the lack of human resources is one of the major obstacles that the enterprises are facing on the way of production recovery.

Phạm Thị Tình from the Vietnam Alliance for Industrial Support said after a long break due to the pandemic, the skills of workers have decreased, so the enterprises must spend time and expense on retraining. The cost of labour in the industrial sector has increased, but it is still not enough to attract workers.

In addition, the Ministry of Industry and Trade said that manufacturing enterprises need to diversify markets importing raw materials as well as exporting goods to avoid dependence.

There should be more policies to develop supporting industries in Việt Nam to gradually become self-sufficient in raw materials. This is the core issue for sustainable industrial development in Việt Nam.

The ministry also noted that it is necessary to continue changing industrial restructuring in the direction of developing the manufacturing industry and reducing processing and assembling for industrial products made in Việt Nam.