Industry insiders and policymakers have cautioned that Viet Nam is facing an uphill battle to achieve its goal of 6 per cent export growth this year.
Global demand for Vietnamese products has been dwindling, with the country's major exports, such as furniture, footwear, and seafood, receiving far fewer orders than last year.
The General Department of Viet Nam Customs revealed that, by the end of February, the country's electronics exports had dropped by 13.9 per cent to US$6.87 billion compared to 2022.
Additionally, machinery and tools exports reported a 1.6 per cent decline to $6.4 billion, while textile exports dropped by a significant 19.6 per cent to $4.55 billion. Footwear and furniture exports also suffered losses, declining by 15.8 per cent and 34.8 per cent, respectively, to $2.76 billion each.
Mobile phones and parts remained among a handful of exports that reported a positive growth at 7.6 per cent, or $9.42 billion, thanks to Samsung introducing its 2023 models earlier than usual.
The textile sector was particularly affected by lower global demand, according to the minister of trade and industry Nguyen Hong Dien, with a total export worth of $4.5 billion, a 20 per cent decrease year-on-year.
"Lower demand in the world's major markets such as the US and China, on top of a large inventory held by retailers, have resulted in fewer orders placed this year," said Cao Huu Hieu, director-general of Vinatex, one of the country's largest textile groups.
The seafood sector has seen fewer orders since the end of 2022, with demand from the US and the EU nosediving by 35 per cent and 8 per cent, respectively.
Viet Nam's seafood export during the first two months of the year was reported at $1.1 billion, a 26 per cent decrease from last year. Tra fish, in particular, was down by 38 per cent, shrimp by 37 per cent and tuna by 27 per cent.
Furniture was down by 35 per cent, with the industry's forecast remaining grim as large global markets such as the US and the EU will likely reduce spending due to inflation, economic setbacks and lower purchasing power.
Meanwhile, Vietnamese furniture makers still struggled to meet said market's product origin and standards regulations. High inventory and a damaged distribution network after the pandemic were other contributing factors.
Several measures have been taken to support businesses, according to the Ministry of Industry and Trade (MoIT), including trade promotional and networking events.
Viet Nam's trade representative offices overseas have been told to step up efforts to help businesses enter new markets and resolve on-going issues with their entry.
The ministry said while businesses wait for traditional markets such as the US, the EU and Japan to recover, they must seek out other alternatives, especially markets in the Middle East, Eastern Europe, Latin America and South Asia. — VNS