Trade value set to double by 2026
Trade value set to double by 2026
Viet Nam is expected to see rapid trade growth in the next 15 years, with its trade expected to almost double by 2026, an HSBC report released yesterday said.
It was US$202 billion last year.
The Global Connections Report forecast the country's growth at 8.2 per cent a year until 2021 before slowing like its Asian peers in the next five years (2022-26) to around 5.3 per cent.
Trade with its major trading partners will remain strong, with the exception of Australia where falling exports of oil are expected to weigh.
The US is by far the largest export destination for Viet Nam, yet exports will continue to grow strongly - at 6.6 per cent per year - for the next five years led by furniture, clothing and footwear.
Exports to Japan, the second largest buyer now, are expected to grow by around 6 per cent, with wire and cable being the top items.
Exports to Germany are led by footwear and coffee, and again growth is expected to be strong at over 7 per cent.
China is also a key partner for Viet Nam, with strong export growth of 10.2 per cent per year forecast until 2016. Coal will be the top export.
But the fastest growing export market is expected to be Switzerland (17 per cent), followed by India (14.5 per cent) and Brazil (14 per cent).
Exports to Russia, the UAE, Turkey, Hong Kong, and S.Korea are all expected to grow by more than 11 per cent over the next five years.
Norway, Brazil, Turkey, and India will be the fastest growing import markets, with increases of well above 10 per cent. Imports from the US and the UAE are both expected to grow by around 10.9 per cent.
In terms of goods and services, audio-visual parts and equipment exports are projected to grow at 16.6 and 14.4 per cent. Telecom equipment export is expected to grow at 15.9 per cent.
Iron and steel will top import growth at 13.5 per cent, with cotton and aircraft also expected to be better than 12.5 per cent.
Positive sentiment
According to the HSBC Trade Confidence Index, a component of the report, confidence amongst Vietnamese international businesses remains stable and relatively high.
Scores of 116, 115, and 115 have been recorded since the first half of 2011. Despite an 8 per cent contraction since H2 2011, 80 per cent of... respondents still expect to see trade remain stable or grow in the next six months.
The survey shows that intra-regional trade will remain critical for Vietnamese businesses now and over the next six months. Singapore's top three trade partners are within Asia (Greater China, Southeast Asia, and rest of Asia)
The main import partners will be in the region, led by China with growth of 10.4 per cent.
The top items will be petroleum, hot rolled iron and steel, and telecom equipment.
South Korea, Singapore, and Japan will also see their exports to continue growing steadily, again led by petroleum and hot rolled iron and steel.
The biggest export item for Viet Nam now is crude oil which is expected to weaken over the next five years, with a modest decline projected.
Then comes footwear, which is expected to see growth of around 3.2 per cent, with the US and Germany being the key markets.
Furniture is the third largest export sector and is expected to see strong growth of around 6.3 per cent, led by US buying.
Coffee is another fast-growing sector with exports expected to rise by more than 6 per cent.
Fuel tops on the import side, and is expected to continue to grow robustly at close to 4.5 per cent, with Singapore, S.Korea, and China being the three biggest suppliers.
The second largest is hot rolled iron and steel, and growth of 8.7 per cent is expected in this sector, mostly from China, S.Korea, and Japan.
Telecom equipment and knit fabric follow, and will grow by around 12.9 and 9 per cent.
Other items expected to see double digit growth are electric motors and generators, cars, electronic circuits, computers, spirits, and plastics
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