Vietnam’s econonic situatiaon in 1st half year of 2009

Entering 2009, the country’s economy continues facing a lot of difficulties and challenges. The world’s ever-more severe economic recession has narrowed the export and capital market, and had nagative effects on the country’s social economy.

Confronted with this, the Polibureau, Government and NA have put forward many policies and solutions with an aim to fulfil the general Resolution of the NA’s 4th Session, i.e. continuing to curb inflation, statbilize the macro economy, maintain a reasonable and sustainable growth, actively prevent recession, ensure social security; promote active and effective cooperation and integration with the international economy; hold fast to political stabilization, ensure national defence, social security and order; creating good conditions for successfully fulfil the five- year social-economic development plan, 2006-2010.

Based on collected data for 5 months and estimated data for June, the General Statistics Office (GSO) presents the general situation of social and economic development in 1^st half of 2009 according to three areas: (1) Preventing economic recession, maintaining reasonable and sustainable economic growth; (2) Stabilizing the macro economy and preventing high re-inflation ; (3) Ensuring social security.

RESULTS OF PREVENTING ECONOMIC RECESSION, MAINTAINING REASONABLE AND SUSTAINABLE ECONOMIC GROWTH

Growth of GDP

Quarter I/2009, with GDP growth of 3.1% only, equaling 41% of GDP growth in quarter I/2008 was the quarter with lowest GDP growth in recent years; but as estimated, GDP in quarter II/2009 grew by 4.5%, equaling 79% of quarter II/2008 and higher than the rate of quarter I/2009 1.4 points percent . Generally, the GDP in 1^st half of 2009 increased by 3.9% compared to same period in 2008, of which, the agriculture, forestry and fishing rose by 1.25%; the industry and construction by 3.48%; and the service by 5.5%.

Agriculture, forestry and fishery

The production value of this sector at 1994 constant prices in 6 months of 2009 estimated rising by 2.5% against same period last year, of which, agriculture grew by 1.8%; forestry by 3.1% and fishery by 4.3%.

Agriculture and forestry

Cultivated areas of 2009 winter-spring rice crop over the country were 3059.7 thousand ha, rose by 46,600 ha against same crop in 2008: the North: 1150.4 thousand ha, rose by 21,000 ha; the South: 1,909.3 thousand ha, rose by 25,600 ha.

According to local preliminary reports, winter-spring rice productivity in this year estimated achieving 6,090 Kg per ha, rose 10 Kg/ha against same crop last year; the yield was 18.6 million tons, rose by 312,000 tons.

According to the animal husbandry survey, at period 01/4/2009, there were 26.5 million pigs, rose by 3.6% ; 256 million poultry heads, rose by 11.4% against same period last year.

Total concentrated forestation areas in six months of 2009 were 73,300 ha, rose by 6.2%; dispersed plants were 107.5 millions, reduced by 2.1%; woodcut production was 1674.1 thousand m³, grew by 7.5% against same period last year.

Fishery

Catching and raising production in 6 months was at an estimate of 2287.6 thousand tons, increased by 5% compared to same period last year. Of which, the raising gained 1125.5 thousand tons, rose by 2.4%; catching: 1162.1 thousand tons, rose by 7.7% (sea catching: 1076.7 thousand tons, rose by 8%).

Low increase in raising production was mainly due to difficulties in consuming products and accessing to favorable interest loans, which catfish raising establishments were facing. Therefore, the surface areas for raising catfish were  5,500 ha, reduced by 15% compared to same period last year. Localities having much reduced surface areas were An Giang (20%); Đồng Tháp (30%); Cần Thơ (17%).

Industrial outputs

The industrial production value at 1994 constant prices in 6 months of 2009 raised by 4.8% against same period in 2008, of which, the mining and quarrying grew by 8.6%, mainly due to much increase in crude oil production; the manufacturing by 4.4%; the electricity, gas and water by 8.1%.

Some items still maintained higher growth against 6 beginning months of 2008 like: crude oil 17.9%; cement 24.1%; artificial leather shoes and sandals 15.6%; round steel 12.6%; commercial water 10.2%; generated electricity 7.9%, etc. Meanwhile, many other important items had low or decreased growths against same period last year: Liquefied gas rose by  4.5%; natural gas (in air form) by 3.7%; textile from synthetic or artificial yarn by 3.7%; processed seafood fell by 8.5%; textile from cotton yarn by 23.2%; chemical paint by 5.4%, etc.

Trade

Retailed sales of consumer goods and services

The total retailed sales of consumer goods and services in the six beginning months at current prices were at an estimate of VND 547.5 trillions, grew by 20% compared to same period in 2008. If the price raising factor were excluded, the figure grew by 8.8%. Of the total, the trade business accounted for 78.4% and rose by 20.7% against same period last year; the hotel and restaurant 11.3% and 17.3%; the service 9.3% and 17.6% respectively.

Transport

Passenger carriage in 6 months of 2009 was at an estimate of growing by 7% in volume carried and by 4% volume traffic carried compared to same period in 2008, of which, the land rose by 7.6% and 7.1%; the river 2.3% and 1.7%; the sea 3.2% and 4.9%; the air rose by 0.3% in volume carried and fell by 1.9% in volume traffic carried; the rail reduced by 2.5% and 10.8% respectively.

The volume of cargos carried in 6 months was at an estimate of increasing by 0.3% in the volume carried and by 1.1% in the volume traffic carried compared to same period last year, of which, the land grew by 2.8% and 2.1%; the river reduced by 2.2% and 6.5%; the sea fell by 13% in the volume carried and rose by 3.1% in the volume traffic carried; the rail fell by 13.6% and 17.8% respectively.

Postal service and telecommunication

Newly developed telephone subscribers in 6 months of 2009 were at an estimate of 15,3 millions, growing by 54.3% against same period in 2008, of which, there were 1.6 million desk phone subscribers, rising by 36.1%; 13.7 million mobile phone subscribers, growing by 56.6%. To the end of 6/2009, the country had  96.7 million telephone subscribers, of which, there were 15.7 million desk phone subscribers, rising by 24.4% and 81 million mobile phone subscribers, growing by 64.6%; The number of broadband internet subscribers was at an estimate of 2.6 millions, rising by 54.1%. The number of broadband internet subscribers to end of June 2009 was 22.5 millions, growing by 11.6% against same period in 2008. Total postal and communication service net incomes in 6 months of 2009 were VND 36.7 trillion, increasing by 19.5% against same period last year (the VNPT gained VND 27.5 trillions, growing by 24.5%).

Tourism

As estimated, international visitors to Viet Nam in six beginning months of 2009 reduced by 19.1% against same period last year, of which, visitors coming for tourist purpose fell by 22.1%; for business purposes down by 21.9%; for visiting relatives rose by 1.7%. The volume of visitors coming to Vietnam from almost countries over the world reduced compared to same period last year, of which, passengers from China fell by 39%; from the United States by 4.2%; from Republic of Korea by 19.9%; from Japan by 9.7%; from Taiwan by 17.3%; from Australia by 7.8%.

RESULTS OF STABILIZING THE MACROECONOMY AND PREVENTING HIGH REINFLATION

Investment & Development

The social realized investment capital in 6 months of 2009 at current prices was at an estimate of VND 322.6 trillions, growing by 18.1% against same period last year, of which, the state sector accounted for 43.9% of the total and rose by 33.4%; the non-state sector: 34.1% of the total and rose by 37.4%; the FDI sector: 22% of the total and fell by 18.4%. Of the state investment capital,  amount from the state budget was at an estimate of VND 50.6 trillions, equaling 35.1% compared to the yearly estmate which has been added the construction stimulant package.

The attraction of the FDI was at low level, gaining  USD 8.9 billions from 1/1/2009-19/6/2009, dropping by 77.4% against same period in 2008, including USD 4.7 billions of 306 newly licensed projects (dropped by 86.7% in capital and 65.6% in number of projects); USD 4.2 billions additional registered capital of  68 times of  projects licensed in previous years. Realized FDI in 6 months of 2009 was at an estimate of USD 4 billions, reducing by 18.4% against same period in 2008.

The attraction of ODA from beginning of the year to 16/6/2009 gained USD 1783 millions, growing by 15.9% against same period in 2008, of which, loans were USD 1700 millions, up by 22.8%; non-refundable aids: USD 83 millions, down by 46.3%. The reimbursement of ODA in 6 months estimated achieving USD 1270 millions, growing by 9% against same period in 2008 and equaling 67% of the 2009 reimbursement schedule, of which, loans achieved USD 1163 millions; and non-refundable aids: USD 107 millions.

Government revenues and expenditures

As estimated, total Government revenues from beginning of the year to 15/6/2009 equaled to 43.9% of the yearly estimate, of which, domestic revenues accounted for 45.1%; revenues from crude oil equaled to 36.1%; revenues from import-export: 46.6%. Total Government expenditures from beginning of the year to 15/6/2009 equaled to 40.2% of the yearly estimate. Of which, spending for investment and development accounted for 43.2% (only spending for capital construction investment was 42.3%); for economic and social development, national defense and security: 45.2%; for paying debts and aids: 44%.

Trade balance

The export turnovers in quarter II/2009 reduced by 4.7% compared to quarter I due to no re-export of gold. If quarter I’ re-export of gold was excluded, the Q.II’ export turnovers still grew by 16.1% compared to Q. I. Generally, in 6 months, the export turnovers gained only USD 27.6 billions, fell by 10.1% against same period last year. If the gold re-export factor was excluded, the figure was USD 25.1 billions, reducing by 18.6% compared to same period last year. The decrease was mainly due to a falling and low level in the international market prices. Only comparing 8 main export items (crude oil, coal, rice, coffee, cashew nut, rubber, tea and pepper) to the average price in 6 beginning months of 2008, the turnovers increased more USD 5 billions, and thus, the total turnovers of the country in 6 months rose by 6.3%.

Considering by commodity group, export turnovers of agricultural and forest products rose by 4.5% compared to same period in 2008; heavy industrial and mineral products fell by 23%; light industrial and handy crafts by 25%. And, the structure of commodity export groups changed considerably: agricultural and forest products accounted for 18.9% of the total export turnovers, increasing compared to the rate 16.4% in same period last year; heavy industrial and mineral products accounted for 27.7%, reduced against the rate 32% of same period last year; light industrial and handy crafts: 36.1%, falling against the rate 45.4% of last year’ same period.

Due to the effects from the world’s economic recession, the 6 months’ export turnovers to major markets fell against same period last year, of which, Japan market reduced much by 40%; EU by 16%; South Korea by 11%; and China by 9%.

The import turnovers in 6 months of 2009 were at an estimate of USD 29.7 billions, dropping by 34.1% against same period in 2008, of which, machinery and equipment reduced by 22.7% and consumer goods rose by 2.6%. The decrease in 6 months’ import turnovers was partly due to a decrease in the volume of some imported goods, but mainly due to the falling of the world’s market prices (petroleum by 52%; fertilizer by 33%; steel by 31%; plastic by 32%; textile yarns by 23%).

There was also a change in the import structure: machinery and equipment accounted for 29.4% of the 6 months’ import turnovers (same period in 2008 it was 25.2%); consumer goods 9.6% (same period last year: 6.2%). The import turnovers in 6 months of 2009 from ASEAN were at an estimate of USD 6 billions, down by 34%; from China: USD 7 billions, down by 27%; from South Korea: USD 3 billions, down by 32%; and from Japan: USD 3 billions, down by 37% against same period last year.

The trade deficits in 6/2009 were USD 1.2 billions, lower than the rate of USD 1.25 billions in last months. Generally, the trade deficits in 6 months of 2009 were USD 2.1 billions, equaling 14.7% of same period last year. If quarter I’ re-export of gold was excluded, the trade deficits in 6 months were USD 4.6 billions, of which, trade deficits in quarter I were USD 1 billion; and the trade deficits in quarter II were USD 3.6 billions. The biggest market for trade deficits of Vietnam still was China with an amount USD 5 billions import surplus; the United States and EU still were markets for the export plus of Vietnam with levels of USD 3.9 billions and 2.1 billions respectively.

The turnovers of service export in 6 months of 2009 were USD 2737 millions, dropping by 25.7% against same period last year; The turnovers of service import in 6 months of 2009 were USD 3256 millions, dropping by 26.2%. The service import surplus in 6 months was USD 519 millions, dropping by 29.1% compared to same period in 2008.

Results of preventing high re-inflation

Compared to previous month, the CPI in January only increased by 0.32%; February by 1.17%; March fell by 0.17%; April rose by 0.35%; May by 0.44% and 6/2009 by 0.55%.

Consumer prices in 6/2009 rose by 2.68% against 12/2008 since prices of almost commodity and service groups increased, of which, restaurant and catering service grew by 2.5% (food rose by 0.59%; foodstuff by 2.2%; eating and drinking outside the family by 5.65%); housing and construction material by 5.65%; drinks and cigarettes by 4.51%; family appliance; textile, hats and footgear by over 3%; and others rose from 0.4-1.8%; only means of transport and postal service fell by 0.57% but others rose by 7.6%.

If comparing with the average price in 6 beginning months of 2008 the CPI in 6 beginning months of this year increased by 10.27%, of which, restaurant and catering service grew by 14.81%; drinks and cigarettes by 11.21%; family appliance by 10.88%; textile, hats and footgear by 10.83%; medicine and health care by 8.32%; culture, sport and entertainment by 8.02%; education by 6.12%; housing and construction material by 2.91%. Only means of transport and postal service fell by 2.8%.

Tags: Vietnam economic 2009, Vietnam economic statistics, Vietnam's economy situation