Exports on the slide as global prices fall

This fall goes against the trend experienced in the past, with the export market bustling and export values increasing during the year-end period. 

According to the General Statistics Office, the country posted an export value of 4.8 billion USD during November, the lowest total for eight months. 
 
The prices of almost all of Vietnam ’s export staples have fallen in recent months, including the prices of crude oil, rice, coffee and rubber latex. 
 
In November, the export value of crude oil dropped from 669 million USD to 505 million USD, while earnings from exports of rice and seafood fell by tens of millions of USD. 
 
In addition, exports of other products, such as garments and textiles, footwear and seafood were affected by trade barriers, including anti-dumping taxes and the monitoring mechanisms of major markets such as the US and EU. 
 
Other factors include the difficulties facing producers and exporters in gaining access to sources of capital due to the government’s strict monetary policy and the scarcity of Vietnamese currency in the market during the first months of this year. Another reason is the poor competitiveness of Vietnamese goods compared to similar goods produced by other ASEAN countries and China . 
 
In addition to the decrease in exports, Vietnam is likely to face a huge trade deficit. Last year, the country had a deficit of more than 14 billion USD. This year, the figure for the first 11 months has reached almost 17 billion USD. 
 
Economist Vo Tri Thanh from the Central Economic Research Institute said that increasing competitiveness through low prices is rendered obsolete when technical barriers are put in place by the US , EU and Japanese markets. 
 
Even though the Ministry of Industry and Trade has predicted an export value of 63 billion USD for this year, there remain worries over exports during 2009. The target for export growth in 2009 has been reduced accordingly to 13 percent by the National Assembly, down from the previous target of 18 percent set by the government. 
 
The Ministry of Industry and Trade has requested banks to give priority to granting credit and ensuring a supply of capital for businesses, to allow them to purchase materials for production and exports, while continuing to reduce interest rates to encourage consumption and promote production. 
 
The ministry also urged businesses to expand their markets, reducing their dependence on traditional markets. Relevant agencies and associations have been reminded to cooperate with businesses to remove any obstacles in order to stimulate exports. 
 
Beside measures to promote exports, a series of additional measures, such as the quality check of imported goods, the use of technical barriers and the examination of goods prior to customs clearance will be adopted in an effort to limit the extent of the trade deficit.