FIEs saw rising export amid growing imports

The foreign-invested sector saw a 40 per cent jump in export and import values by late December, 2010.

Between January and December 20, 2010 the sector reaped $33.88 billion ($38.82 billion including crude oil), a 40 per cent hike against 2009’s figure and double the domestic sector’s 20 per cent growth in export value, according to the Ministry of Planning and Investment’s Foreign Investment Agency (FIA).

Deputy minister of Industry and Trade (MoIT) Nguyen Thanh Bien attributed the leap to a growing presence of hi-tech products from foreign invested enterprises in Vietnam’s export structure.

“In 2010, Samsung Electronic Vietnam contributed more than $1 billion to the country’s export value after more than a year of operation. Also in that year, Intel Vietnam, after launching its $1 billion chip plant in the Ho Chi Minh City Hi-Tech Park, exported first shipments worth several hundred million dollars,” Bien said.

The sector currently contributes 47 per cent of Vietnam’s total export value.

Besides a sharp rise in the export value, the foreign-invested sector also witnessed nearly 40 per cent jump in the import value which stood at $36.4 billion in 2010 against $26.06 billion in 2009, according to the FIA.

The MoIT analyses showed that imported raw materials for export production made up half of the sector’s total imports.

Samsung Vina general director Park Je Hyoung said around 90 per cent of materials in producing made-in-Vietnam Samsung-branded mobiles were imported, mostly from China.

Analysts had attributed poorly performed local supporting industries to rising import value of foreign invested sector. Over 67 per cent of Japanese businesses operating in Vietnam said failure in sourcing production materials from local businesses had impeded their activities amid escalating import expenses.

However, there was an argument that booming property, services and retail developments in recent years had lured in FDI from processing and manufacturing sectors.

At the same time, the application of the import tariff reduction roadmap under Vietnam’s World Trade Organization commitments had made retail and distribution more appealing to investors than manufacturing. – VIR

Tags: Vietnam companies, Vietnam enterprises, Vietnam FIEs