Economists give alerts about increasing invasion of Chinese imports
LookAtVietnam - While some state
officials say they cannot see any problems in the trade deficit with China,
economists have expressed their worries about the increase in the presence of
Chinese goods in Vietnam.
officials say they cannot see any problems in the trade deficit with China,
economists have expressed their worries about the increase in the presence of
Chinese goods in Vietnam.
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2010, China had become the
biggest trader of Vietnam.
However, the sharp excess of the imports from China
over exports to the country in the two-way trade has become a headache to Vietnam.
By the end
of April 2011, the trade deficit with China had reached 4.1 billion
dollars so far this year. The noteworthy thing is that the trade deficit with China amounted
to 84 percent of the total trade deficit of the country.
of April 2011, the trade deficit with China had reached 4.1 billion
dollars so far this year. The noteworthy thing is that the trade deficit with China amounted
to 84 percent of the total trade deficit of the country.
The Vietnam Center
for Economic and Policy Research VEPR under the Hanoi National
University, in its latest
report, gave warning about the increasingly high penetration of Chinese goods,
from machines and equipment to consumer goods.
for Economic and Policy Research VEPR under the Hanoi National
University, in its latest
report, gave warning about the increasingly high penetration of Chinese goods,
from machines and equipment to consumer goods.
The source
said that the Chinese goods which have been most penetrating into Vietnam, are
the ones in the fields of power, oil and gas, mechanical engineering,
metallurgy, mining and chemicals – the “upstream industries”, where there are
many EPC (engineering, procurement, construction) projects are under execution.
The investors of the huge projects are Vietnamese key conglomerates, while the
contractors of the projects are Chinese enterprises.
said that the Chinese goods which have been most penetrating into Vietnam, are
the ones in the fields of power, oil and gas, mechanical engineering,
metallurgy, mining and chemicals – the “upstream industries”, where there are
many EPC (engineering, procurement, construction) projects are under execution.
The investors of the huge projects are Vietnamese key conglomerates, while the
contractors of the projects are Chinese enterprises.
Some
officials of the Ministry of Industry and Trade (MOIT), when talking about Vietnam’s trade deficit, said that the trade
deficit would not be a big problem at all, since Vietnam, like many other developing
economies, needs to import technologies and equipment to run domestic
production. In this case, the imports today will bring high values in the
future.
officials of the Ministry of Industry and Trade (MOIT), when talking about Vietnam’s trade deficit, said that the trade
deficit would not be a big problem at all, since Vietnam, like many other developing
economies, needs to import technologies and equipment to run domestic
production. In this case, the imports today will bring high values in the
future.
VEPR, on one hand, agreeing that trade deficit is the problem of most of the
developing economies in the world, on the other hand, still said that it would
still be a problem to Vietnam
since the trade deficit with the neighboring country has been accounting for an
increasingly high proportion in the total trade deficit of Vietnam.
Meanwhile, the pervasive values and impacts on the technologies and the society
of the imports are not as high as expected.
VEPR’s
Director, Nguyen Duc Thanh thinks that Chinese equipment and goods have
advantages in Vietnam
because they fit Vietnam’s
starting point when joining the global production chain, and because they are
suitable to the income of Vietnamese people.
Director, Nguyen Duc Thanh thinks that Chinese equipment and goods have
advantages in Vietnam
because they fit Vietnam’s
starting point when joining the global production chain, and because they are
suitable to the income of Vietnamese people.
“Contractors
have been trying to bring big amounts of goods and materials to Vietnam and turn Vietnam
into a trade partner who imports goods in big quantities from China,” Dr
Thanh said.
have been trying to bring big amounts of goods and materials to Vietnam and turn Vietnam
into a trade partner who imports goods in big quantities from China,” Dr
Thanh said.
The
research conducted by VEPR also showed that Vietnam’s
trade deficit with China
has no close relation with the investment flow from the country.
research conducted by VEPR also showed that Vietnam’s
trade deficit with China
has no close relation with the investment flow from the country.
“Chinese
investment flow into Vietnam
is really low if compared with the imports flow,” Thanh said.
investment flow into Vietnam
is really low if compared with the imports flow,” Thanh said.
Agreeing
with VEPR that it is necessary to give alert about the increasing trade deficit
with China, Dr Le Xuan Nghia, Deputy Chair of the National Finance Supervision
Council, said that the negotiations between Vietnam and China, which aim to
allow the two sides to use Chinese yuan in the trade payments may lead to bigger
difficulties for Vietnam in the near future.
with VEPR that it is necessary to give alert about the increasing trade deficit
with China, Dr Le Xuan Nghia, Deputy Chair of the National Finance Supervision
Council, said that the negotiations between Vietnam and China, which aim to
allow the two sides to use Chinese yuan in the trade payments may lead to bigger
difficulties for Vietnam in the near future.
Dr Vo Tri
Thanh, Deputy Head of the Central Institute for Economic Management CIEM,
pointed out that it is necessary to pay attention to machinery, equipment and
intermediate goods imported from China.
Thanh, Deputy Head of the Central Institute for Economic Management CIEM,
pointed out that it is necessary to pay attention to machinery, equipment and
intermediate goods imported from China.
“25 dollars
out of every 100 dollars worth of products imported from China are
machines and equipment which relate to the story about investment and long term
production capability, or the strategy story,” Thanh said.
out of every 100 dollars worth of products imported from China are
machines and equipment which relate to the story about investment and long term
production capability, or the strategy story,” Thanh said.
“70 percent
of the total import turnover is intermediate goods, which is also relating to a
long term development story,” he added.
of the total import turnover is intermediate goods, which is also relating to a
long term development story,” he added.
As for
intermediate goods, more than a half of them have been put into the domestic
production and consumption, while the other half have been used to make
consumer goods for export.
intermediate goods, more than a half of them have been put into the domestic
production and consumption, while the other half have been used to make
consumer goods for export.
“As such,
the most important part relating to the trade deficit with China, is the
import of machines and intermediate imports. If we can reduce the imports, we
will be able to reduce the trade gap,” Thanh concluded.
the most important part relating to the trade deficit with China, is the
import of machines and intermediate imports. If we can reduce the imports, we
will be able to reduce the trade gap,” Thanh concluded.
Source: TBKTVN
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