Export plan for 2007 can be fulfilled?

17:23' 26/07/2007 (GMT+7)

VietNamNet Bridge – Exports in the first six months of the year were not as successful as expected, which has raised a question about whether or not the ambitious export plan for 2007 can be fulfilled. Deputy Minister of Trade Nguyen Thanh Bien on July 24 expressed his concern about export performance in the second half of the year at a conference on exports. Exports up, but worries exist According to Pham The Dung, Director of the Import-Export Department under the Ministry of Trade, though exports in the first half of the year increased by 20% over the same period of last year ($22.54bil in turnover) the figure was still lower than expected. A lot of efforts are needed for the remaining months of the year to reach the targeted export turnover of $48bil. Mr Dung acknowledged that it proved to be a very difficult task to fulfill, especially as exports of key items might not be satisfactory. Except coffee, apparel, footwear, seafood and plastics, which maintained stable export growth, other key export items had low export volume in the first half of the year. For example, Vietnam exported 2.3mil tonnes of rice ($732mil), down by 5% in price and 18% in quantity. Rubber exports brought $527mil in turnover, down by 4% over the same period of last year, while Vietnam previously planned to increase the export turnover of this product by 7%. Vietnam exported 7.7mil tonnes of crude oil in the first six months, a decrease of 6.7% in volume, while the country has to export 17.5mil tonnes in 2007 to fulfill the plan in turnover. The quality of exports – a big problem Officials from the Ministry of Trade (MoT) stressed that the quality of exports remained a big problem. If drastic measures are not taken, Vietnam may lose its export markets. The Ministry has asked the Government and the Ministry of Finance to budget for the works of inspecting export products. Regarding apparel exports, Mr Bien said that MoT was trying to do what it could to minimise the bad impacts of the US’s programme on Vietnam’s apparel imports monitoring. Mr Bien said that MoT would strengthen the supervision and control over the origin of exports. In the immediate time, MoT will not allow temporary import for re-export later, a move aiming to prevent fraud in the declaration of product origin. The proposal by MoT has been accepted by the Government. According to Huynh Minh Hue, Deputy Secretary General of the Vietnam Food Association, there are many reasons behind the decreases in rice exports. Exporters now have to pay more for transport fees (up by 40% compared to 2006) and for storage fees, as many exporters cannot charter ships for carrying rice. Mr Hue said that though rice exports could go for good prices, at $290/tonne on average, $39-40/tonne higher than during the same period last year, profit remained modest. Pepper exporters are also facing big difficulties, as the export volume decreased by 31.1%, though the export price was triple last year. American and European countries are now limiting importing pepper from Vietnam because they think that Vietnam-made pepper is too expensive. Ambitious plan can be fulfilled? Mr Bien said that the fulfillment of the export plan would rely on the export of key items, including coffee, apparel and seafood. High hopes are still put on rice and crude oil, which had ‘problems’ recently. Experts said that the export prices of these products always go up in the last months of the year. Wooden products, electronic accessories, and plastics are also forecast to maintain high growth rates. Apparel exports are believed will bring the highest turnover, at $7.3-7.5bil. Currently, the average turnover of apparel exports remains above the ideal level, at $600mil/month. Mr Huy said that enterprises would have a lot of pressure as they would have to ensure both export growth and the quality of exports. Van Thanh Huy, Chairman of the Vietnam Coffee and Cocoa Association, has also expressed his concern about exports in the second half of the year. The industry has fulfilled 92% of the yearly export plan, and only has to export 300,000 more to fulfill the plan of 1.2mil tonnes and $1.5bil in turnover. However, Mr Huy said it would be a big difficulty to ensure the quality of exports. Especially, quality is a big problem for seafood exports. The EU, US and Japan are now inspecting imports from Vietnam very carefully, and if the problem of unsafe exports cannot be settled, Vietnam may lose the export markets. Russia has also created difficulties for Vietnamese exporters as an inspection delegation will arrive in Vietnam to make the final inspection tour of seafood processing establishments, a necessary procedure for considering if it will allow Vietnam to resume exports to the market. In the immediate time, the state will spend VND50bil ($3.12mil) to buy five machines which can examine the quality of seafood. This is hoped will help bring $2.1bil in turnover from seafood exports in the second half of the year. (Source: Tuoi tre, Viet Nam Net)