But Vietnamese exports recorded an impressive performance, becoming a bright spot and laying the foundation for a firm economic recovery in 2021.
According to the General Statistics Office (GSO), Vietnam exported US$281.5 billion worth of goods, up 6.5%, and recorded a trade surplus of US$19.1 billion, the highest figure since 2016.
The success of Vietnam’s export in 2020 was thanks to Vietnam’s initial success in containing Covid-19, with most domestic economic activities taking place almost normally, except for the first 15 days of April when social distancing measures were in place nationwide.
At the same time, Vietnam managed to take advantage of new-generation free trade agreements such as the CPTPP and EVFTA; and diversify its markets and connect with new supply chains, among others.
But there were also dark spots in the economic picture when agricultural and seafood exports fell by 1.9% and 1.8% respectively. Exports to many major markets such as the EU, ASEAN, Japan and the Republic of Korea dropped by between 2.7% and 8.7%.
Export revenue from the domestic sector also fell by 1.1% and accounted for just 27.8% of Vietnam’s total exports. The export of services plunged by 68.4%. With goods and services combined, Vietnam’s trade surplus was only US$7.1 billion.
Despite their considerable contributions to expanding exports, trade promotion activities are exposing many drawbacks in terms of form, size, professionalism and effectiveness.
In 2021, with the EVFTA, CPTPP and other free trade agreements being implemented, Vietnam is well-positioned to make a strong recovery and exports are bound to grow sharply in line with economic recovery and an improved Covid-19 situation in Vietnam and the world. A GSO survey shows that 81% of manufacturing enterprises state that their performance in the first quarter of 2021 will be stable or better than the fourth quarter of 2020.
In order to take advantage of such opportunities, Vietnam needs to continue quickly implementing synchronous measures, promote the restructuring of export goods and enhance technological innovation and the competitiveness of export goods.
Trade promotion activities need to focus on key exports with potential for growth such as agricultural products (food, seafood, fruits, tea, coffee, cashew nuts, pepper, rubber, rice) and manufactured goods (garments, footwear, bags, timber products).
In addition, more attractive promotion programmes are needed in order to enhance the Vietnamese brand, while it is also necessary to promote e-commerce and bolster exports through distribution networks of foreign retailers. Vietnam also needs to take measures to meet the most stringent technical barriers.
The achievements of 2020 are a stepping stone for Vietnam’s export activities in 2021 to continue reaping success, making contributions to national rapid and sustainable socio-economic development.
