Why has seafood export to China not yet made a breakthrough?
Statistics from China Customs show that the country's seafood import demand is recovering strongly after
The tightening monetary policy of the Fed and ECB, the risk of technical recession in Europe, and China's recovery momentum impact Vietnam's imports and exports, according to a newly published report by BIDV Securities (BSC).
Outlining two scenarios for forecasting Vietnam's import and export in 2023, BIDV Securities (BSC) said that according to scenario 1, exports decrease by 10% and imports decrease by 4.42%. Scenario 2: exports decrease by 15%, and imports decrease by 9.09%. The trade balance surplus is at 28.6 - 29.1 billion USD.
On November 13, BIDV Securities (BSC) published the "Vietnam Import-Export Forecast 2023 - 2024" report.
Here, BSC looks back at the 5 years 2018 - 2022. Vietnam's average import-export growth rate is 11.62% over the same period, and imports increase by 11.27%.
However, entering 2023, the analysis team of BIDV Securities believes that the main monetary policy in the world leans towards tightening, led by the United States, causing global commodity demand in general to decline.
Specifically, Vietnam's main export markets are the United States (accounting for about 29.46% of export turnover in 2022), China (accounting for about 15.54% of export turnover in 2022) and Europe (accounting for about 12.61% of export turnover in 2022) will all decline, leading to a weakening of Vietnam's export growth to these markets or even negative growth, according to BSC.
In the first 10 months of 2023, Vietnam's exports reached 291 billion USD, down 6.92%, and imports reached 266.67 billion USD, down 12.09% over the same period.
BIDV Securities' analysis team believes that this situation is due to Vietnam's tendency to import machinery and input materials to produce and export finished products.
In the context that demand in export markets is still weak, export enterprises in Vietnam have no incentive to import for additional production.
S&P Global's report on Vietnam's manufacturing PMI index in October 2023 indicated that new orders increased weakly. Businesses tend to use inventory to meet new orders instead of increasing production.
As a result, the trade balance in the first 10 months of 2023 has a surplus of 24.61 billion USD, an increase of 156.65%.
BIDV Securities stated in recently published research that in 2023, the analytical team presented two import-export scenarios for Vietnam in the context of moderate development in major economies.
- Scenario 1: exports decrease by 10%, and imports decrease by 4.42%.
- Scenario 2: exports decrease by 15%, and imports decrease by 9.09%.
BSC also forecasts a trade balance surplus of 28.6 - 29.1 billion USD.
Entering 2024, BSC forecasts the following scenarios:
- Scenario 1: BSC forecasts that Vietnam's imports and exports will be at 5.5% and 11%, respectively.
- Scenario 2: exports grow by 7.5%, and imports grow by 15%.
The trade balance surplus narrows compared to 2023, at 18.7 - 24.6 billion USD.
BIDV Securities experts analyze these forecasts based on the basis.
First, exports to the US will recover when the US Federal Reserve (Fed) begins to loosen monetary policy.
However, according to the analyst group, the Fed signaled that it would keep interest rates high for a long time, hindering recovery.
Meanwhile, in Europe, inflation is still high. The European Central Bank (ECB) also has the same view as the Fed: to keep interest rates high for a long time until inflation reaches the target threshold of 2%. ECB forecasts that by 2025, average inflation will be 2.1%.
Besides, Europe is also facing the risk of a technical recession. Exports to Europe soon will also be affected.
Regarding China, BIDV Securities' analytical team feels that the country's three key economic pillars, domestic consumption, real estate, and import and export, need to be stronger.
In addition, BIDV Securities experts also believe that input import imports in 2024 will grow stronger after stagnating in 2023 to meet the recovery in output demand.