Vietnam ran a trade deficit in May as the import of major materials rebounded, signaling that green shoots are sprouting in domestic production, experts have said.
The Ministry of Industry and Trade (MoIT) reported that imports turnover in the month was estimated at 33.81 billion USD, up 12.8% year-on-year, while exports stood at 32.81 billion USD, up 5.7%, resulting in a trade deficit of about 1 billion USD.
The country has posted a trade deficit for the first time after its two-year streak of trade surplus, the ministry said, adding that in the January-May period, it still enjoyed a trade surplus of 8.01 billion USD, with imports valued at 148.76 billion USD, up 18.2%.
Notably, up to 88.8% of the imports in the first five months were machinery, tools, equipment and materials in service of production and business, according to the ministry.
The Vietnam Textile and Apparel Association said the sector saw rosy signs in May and the first five months, with many enterprises receiving enough orders for the third quarter, even the whole year.
The import of cotton, fabric, yarn, and other raw materials in May expanded by 14.32% from the previous month. The five-month revenue also increased 15.34% year-on-year.
The domestic production and business recovery has pushed up the sector’s exports in the five months by 6.3% as compared with the same period last year.
Pointing to sustainability in trade surplus, experts said the May trade deficit is not a big problem, stressing imports regaining momentum raises the hope that exports and domestic consultation would stay on a roll in the next periods.
Nguyen Cam Trang, Deputy Director of the MoIT’s Agency of Foreign Trade, said both domestic and foreign-invested sectors recorded export growth, reflecting their recovery this year.
Associate Professor, Dr. Nguyen Thuong Lang from the National Economics University held that domestic firms have found new orders and invested much in production, helping generate jobs and create resources for economic recovery.
