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Vietnam’s performance best among exporters to US
Vietnamese exports to the US grew at the fastest pace among the top 50 American sources of foreign goods, suggesting the Asian country’s focus on low costs is paying off amid slumping global demand.
Among the main 50 exporters to the US, only five recorded increases in American-bound shipments in January: Bangladesh, Denmark, Ireland, New Zealand and Vietnam. Vietnam’s 14 percent increase to US$1.15 billion was the quickest, moving the nation to 22nd on the list of exporters to the US, up from 30th in 2008, according to US International Trade Commission figures.
Vietnam’s performance compares with export slumps to the US over the same period by regional competitors ranging from Indonesia’s 2 percent drop to China’s 5 percent reduction to Malaysia’s 34 percent tumble. Evidence that its sales are not being hit as hard as competitors may buoy Vietnam’s 2009 growth outlook, which some forecasts have put as low as 2.5 percent.
“It is certainly encouraging,” said Ayumi Konishi, the Vietnam country director for the Asian Development Bank. “Given the composition of Vietnamese exports to the US compared with Asian countries where electronics occupy so much of the total, we did not expect as steep a drop for Vietnam as for others, but an increase is almost too good to be true.”
Overall Vietnamese exports fell 5 percent in the first two months of the year, according to preliminary estimates from the General Statistics Office in Hanoi. The overall export figure is “not that bad” and suggests that Vietnam’s package of lower-end manufactured goods and basic agricultural commodities is giving the country some cushion, Ho Chi Minh City-based fund managers Dragon Capital said in a note dated February 26.
‘Important supplier’
“For retailers, Vietnam has become an important supplier to the US market of a variety of consumer products, including shoes, clothing, furniture, coffee and seafood,” wrote Erik Autor, vice president of the Washington, D.C.-based National Retail Federation, in a March 11 letter to the Office of the US Trade Representative.
Apparel shipments to the US climbed 15 percent in January to $462 million. Vietnam’s focus on the lower end of the garment export market is benefiting the country’s apparel shipments amid a worldwide slump, with many of Vietnam’s competitors in the industry producing higher-cost products, leaving an opening for cheaper goods in a crisis environment, the Vietnam News reported this month.
Footwear exports to the US surged 38 percent in January to $147 million, while furniture shipments advanced 2 percent to $133 million.
“Some of our export companies have had very strong financial performances lately,” said Chris Freund, HCMC-based managing director of fund managers Mekong Capital, citing garment and furniture producers.
“Generally our export-oriented companies have been able to maintain their customers and revenues, but margins declined in 2008 as they couldn’t sufficiently pass on cost increases to their overseas customers,” Freund said in e-mailed comments.
Oil, coffee
Crude oil shipments to the US gained 5 percent by value to $75 million, even as the global price of the commodity tumbled by 55 percent in January 2009 compared with January 2008. ConocoPhillips, Nippon Oil Corp., Soco International Plc, and Talisman Energy Inc. all began production last year from new oil fields in Vietnam in which they hold shares.
Vietnamese coffee exports to the US declined 13 percent in January to $28 million, with the International Coffee Organization citing a “tightened supply situation.” Vietnam’s coffee industry association is expecting a lower crop “as a result of low yields in older plantations and unexpected rainfall,” the London-based International Coffee Organization said in a note released last week.
Seafood exports fell 27 percent to $59 million. Vietnam’s seafood production has been hurt by a lack of capital, with the industry association in the Mekong Delta province of Ca Mau saying that local fish farmers need soft loans, according to the website of the Vietnam Association of Seafood Exporters and Producers.
Bloomberg, thanhnien
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